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If you won your case there will be a judgment against the defendant. You can claim interest on the unpaid amount if:
Case study – Charlie and Kylie
Two years ago Charlie lent $2,000 to his girlfriend's sister, Kylie. Kylie needed to pay a lot of fines so that she could get her drivers licence back. The agreement was that Kylie would pay the money back by last Christmas, but she didn't pay. Charlie has broken up with his girlfriend, and Kylie seems to be avoiding him. Charlie needed the money because he was starting a course soon and was only working part time. Charlie went to court and got a judgment in his favour in December. The judgment ordered Kylie to pay Charlie $2,262.50. However, Kylie has not paid Charlie and now it is April.
To work out the amount of interest you can claim, follow the steps in the guide below.
If there are specific orders about interest and you need help calculating interest, you should get legal advice.
The start date is usually 28 days after the date of the judgment. The end date is when the judgment is paid in full or the court makes specific orders about the interest.
Charlie got a judgment in his favour on 3 December 2014 for $2,262.50. Charlie can claim interest from 2 January 2015.
Start date: 2 January 2015End date: 8 April 2015
There are two kinds of post-judgment interest:
There was no agreement between Charlie and Kylie about interest. Charlie checks the Local Court website and find the court post-judgment interest rates for the period 2 January 2015 to 8 April 2015. For the period 1 January 2015 to 30 June 2015, the interest rate was 8.5% per annum.
You can work out the yearly amount of interest by multiplying the interest rate by the amount of your claim. If there is more than one interest rate for the period you are claiming interest, you need to do this for each interest rate.
Charlie is owed $2,262.50 and he has one interest rate. Charlie does these calculations to work our the yearly interest.
8.5% x $2,262.50 = $192.3125
You need to work out the daily amount of interest for each interest rate period. To do this, divide the yearly amount of interest by 365.
You may find your figure is a very large decimal number. You should always stop at two decimal points to reflect cents. If the third number is 0-4 you round the second number down and if it is 5-9 you round the second number up.
Charlie does these calculations to work out the daily interest:
$192.3125 divided by 365 = 53c
Count the number of days for each separate interest rate period you are claiming interest for.
There is one interest rate for the period Charlie is claiming interest, so he will have to count the number of days when the interest rate was 8.5% per annum. Charlie works out that:Between 2 January 2015 and 8 April 2015 = 97 days
This is the final step. To calculate the amount of interest owed multiply the number of days for each period (step 5) by the daily amount of interest (step 4), and then add these different amounts. This will give you the total amount of post-judgment interest owed to you.
In Charlie's case, there were 97 days when the interest rate was 8.5% per annum. The daily interest for this period is 53c per day.
97 days x 53c = $51.41
The 'post judgment interest' can be added to the pre-judgment interest for the total amount of interest you seek from the judgment debtor.