What type of interest is generally awarded to a successful party in money judgments?

In New South Wales, the type of interest generally granted to a successful party in money judgments is referred to as pre-judgment interest. This type of interest is designed to compensate the successful party for the time value of money during the period between when the cause of action arose and when the judgment is issued.

Pre-judgment interest serves to make the plaintiff whole by providing additional compensation for the loss of use of the money that would have been received earlier. It is specifically calculated from the date of the cause of action up until the judgment is made. The applicable rules governing pre-judgment interest can be found in legislation such as the Civil Procedure Act 2005 (NSW) and the Interest on Money Claims Act 1992 (NSW).

Interest calculated from the time of action is a concept related to this, since pre-judgment interest effectively begins from the time the wrongful act occurred, thus reinforcing the notion of ensuring a fair and just outcome for the injured party. However, the term "pre-judgment interest" is the precise legal terminology used in practice, which is why it is important to distinguish it from the more general phrase "interest calculated from the time of action."

While compensatory interest typically refers to