- Breach of contract — Interest rate and damages
This chapter considers the law on interest. Traditionally, the common law has set itself against awards of interest; this has resulted in the piecemeal intervention of statutes which allow the award of interest in specific situations. The chapter distinguishes between ‘interest as damages’—that is, an award of damages for a tort or breach of contract for loss of the use of money; and ‘interest on damages’—that is, an award of statutory interest on damages. In the important case of Sempra Metals Ltd v IRC the House of Lords reformed the common law on interest as damages. In general, statutory interest can be awarded on debts as well as on damages.
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