The simple answer is yes. There are three types of interest claims:
Contractual – where there is a clause within the company’s terms and conditions of business saying that if payment of invoices is not made within terms, interest will become payable at the rate of 4% above the bank’s base rate from the date of default until full payment is received;
Under S69 of the County Courts Act 1984 or section 35A of the Senior Courts Act 1981 (formerly Supreme Court Act 1981) at the rate of 8% per annum. A claim for simple interest on a debt or damages under these statutes is discretionary. As it is for the court to award interest at such a rate and for such a period as it deems fit, it is always worthwhile challenging both the period and the rate of interest claimed.
Interest under the Late Payment of Commercial Debts (Interest) Act 1998. This will only apply business to business. The Late Payment Act inserts an implied term in the contract, giving the creditor a right to simple interest on the price, plus a fixed sum and reasonable costs of recovery. Interest will be 8% per annum above the Bank of England base rate.
If you have any more questions about interest claims, please contact us today.