Royal Court Revisits Pre Judgment Interest

Introduction

In the latest decision in the long-running Sheyko v Consolidated Minerals Limited litigation¹, the Royal Court has revised its approach to awards of pre judgment interest.

The power to award pre and post judgment interest is conferred by the Interest on Debts and Damages (Jersey) Law 1996 ("the Law"). The rate of post judgment interest (i.e. interest which runs from the date of judgment to the date of payment) is set at 2% above the base rate by Royal Court Practice Direction 05/06. The position on pre judgment interest is less straightforward. Article 2(1) of the Law gives the Court a very broad discretion in the following terms:

"Subject to paragraph (4), in any proceedings, whenever instituted, for the recovery of any debt or damages, the Court may, if it thinks fit, order that there shall be included in the sum for which judgment is given simple interest at such rate as it thinks fit on the whole or any part of the debt or damages in respect