Negotiorum gestio or unjust enrichment? Legal reflections on the case of De Vrij vs. SEG – Part 5: Statutory interest

Compensation for damage is often increased by statutory interest to account for the period during which the injured party was without the money. But when exactly does that interest start to accrue? In case of direct damage, this is usually clear. But what about future income loss?

In the case of De Vrij vs. SEG, this question was also raised. Significant capitalised compensation was involved; and the judge had to determine from what point SEG was liable to pay statutory interest. You can read more about the case of De Vrij vs. SEG here.

Capitalised compensation

The term ’capitalised compensation’ refers to a lump sum compensation payment calculated for damage that will occur in the future. The damage usually concerns loss of income or loss of earning capacity. For example, instead of allocating an amount year after year for lost income, the total future damage is determined as a single amount at once.

The point of contention: from when does interest on future damage accrue?

The court ruled that statutory interest should accrue from 8 March 2018, the day after SEG signed the contracts with Internazionale that established its commission. SEG did not agree with this ruling. According to SEG, there was no legal basis for charging interest on damage that could only be suffered in the future.

The Court partially ruled in SEG’s favour and postponed the interest assessment date to 6 April 2022, the date of the ruling that established the damage at more than EUR 5.2 million gross. According to the Court, the damage was deemed to have been suffered at that time.

The manner of assessing damages is decisive

The point at which statutory interest starts to accrue depends on how the court assesses the damage. If damage is assessed on the basis of a capitalised lump sum—as in the case of De Vrij—then the damage is deemed to have been suffered on the reference date the court uses for that capitalisation.

This does not automatically mean that interest is due from that reference date. Default is required for this. The debtor must have been reminded to pay and, if payment is not made, they must have been informed that statutory interest will be charged. It does not matter whether the reminder was given before the reference date, as long as the debtor was warned about the risk of interest.

Conclusion

In damage claims, statutory interest often represents a significant amount. However, the moment at which interest starts to accrue is not always easy to determine. In principle, in the case of future damage, interest only starts to accrue from the moment the damage is deemed to be established. That moment is usually the ruling establishing capitalisation.

For De Vrij, this meant that he was entitled to statutory interest, but only from 6 April 2022.

Final part of the series

This fifth part concludes our blog series on De Vrij vs. SEG. The case exposed more than just conflicts of interest in football. The long-running legal battle involves various legal doctrines, and it is now up to the Supreme Court to deliver a ruling.

Did you miss the previous parts? You can find them at the bottom of this blog. Would you like to discuss mediation, contractual duties of care or sports-related liability? Please feel free to contact us.