HL Deb 21 October 1969 vol 304 cc1619-21

[No. 12]

After Clause 21, insert the following new clause—

Interest on damages

"In section 3 of the Law Reform (Miscellaneous Provisions) Act 1934 (power of courts of record to award interests on debts and damages), after subsection 1) there shall be inserted the following subsections:— '(1A) Where in any such proceedings as are mentioned in subsection (1) of this section judgment is given for a sum which (apart from interest on damages) exceeds £200 and represents or includes damages in respect of personal injuries to the plaintiff or any other person, or in respect of a person's death then (without prejudice to the exercise of the power conferred by that subsection in relation to any part of that sum which does not represent such damages) the court shall exercise that power so as to include in that sum interest on those damages or on such part of them as the court considers appropriate, unless the court is satisfied that there are special reasons why No interest should be given in respect of those damages. (1B) Any order under this section may provide for interest to be calculated at different rates in respect of different parts of the period for which interest is given, whether that period is the whole or part of the period mentioned in subsection (I) of this section. (1C) For the avoidance of doubt it is hereby declared that in determining, for the purposes of any enactment contained in the County Courts Act 1959, whether an amount exceeds, or is less than, a sum specified in that enactment, no account shall be taken of any power exercisable by virtue of this section or of any order made in the exercise of such a power. (ID) In this section "personal injuries" includes any disease and any impairment of a person's physical or mental condition, and any reference to the County Courts Act 1959 is a reference to that Act as (whether by virtue of the Administration of Justice Act 1969 or otherwise) that Act has effect for the time being'.


My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 12, and with this I should like to discuss Amendments Nos. 17 and 27. This is the new clause dealing with interest on damages. There was not time to deal with this subject and to move such a Clause in this House, but it was one of the recommendations of Lord Justice Winn's Committee. There is existing power in judges to award interest on damages, but they do not in fact usually do so. This clause provides that a judge should do so for such interest rates, and so on, as he thinks fit, unless the defendant satisfies him that there is some reason why he should not.

A good deal of the thinking of Lord Justice Winn's Committee lay in the direction of pushing (if I may put it in that form) plaintiffs and defendants to get on with cases. What the court is doing in, for example, a personal injury action when it awards damages is to award a sum which will put the plaintiffs, so far as one can, in the same position as they would have been in if the accident had not happened. Really the sum is, in a sense, due as soon as the accident, owing to the defendant's negligence, happens, and of course it does not assist plaintiffs if they are kept out of this money for a long time. On the other hand, it may assist defendants. It is not only plaintiffs who do not get on with actions. Defendants, usually an insurance company, may feel that if they manage to keep the plaintiff out of his money for some time he may be prepared to accept a smaller sum in order to get it soon. It may be that the plaintiff has had to borrow money meanwhile to keep going. While he has been doing that, the insurance company have been able to invest the money and earn interest on it. It was, in substance, for these reasons that Lord Justice Winn's Committee accordingly recommend this clause. The other two Amendments to which I have referred are No. 17, which merely binds the Crown, and No. 27, which merely extends the Long Title in order to enable this new clause to be included. My Lords, I beg to move.

Moved, That this House doth agree with the Commons in their Amendment No. 12—(The Lord Chancellor.)

On Question, Motion agreed to.