How is prejudgment interest calculated in Canada?
Under the Courts of Justice Act (Ontario s.128) and equivalent provincial statutes, prejudgment interest is simple interest on the judgment amount, running from the date the cause of action arose to the date of judgment. The rate is set quarterly by the province and published as the prejudgment interest rate. Personal injury non-pecuniary damages accrue at a fixed 5% rate.
What is the postjudgment interest rate in Ontario?
Postjudgment interest runs from the date of the order to the date of payment at the rate set quarterly under the Courts of Justice Act (s.129). It is simple, not compound, interest and applies to the entire judgment including costs. The rate is published each quarter and is typically 1-3% depending on prevailing bank rates.
Is prejudgment interest simple or compound in Canada?
Prejudgment interest under the Courts of Justice Act is simple interest, not compound. The court has discretion under s.130 to raise or lower the rate, or disallow interest for a period, considering the conduct of the parties and any offers to settle.
Does prejudgment interest apply to all damages?
It applies to most pecuniary damages (special damages, lost income, property loss). Non-pecuniary general damages in personal injury cases use a fixed statutory rate of 5% per year rather than the fluctuating quarterly rate. Future losses generally do not attract prejudgment interest because they have not yet been incurred.