In Hungerfords v Walker the High Court held that at common law a plaintiff can recover damages in the nature of interest on a compound basis for loss of use of moneys by reason of a breach of contract or negligence. Recovery in such cases is on the basis that the plaintiff has in fact suffered a loss in being kept out of its money.

In the decision ConnectEast Pty Ltd v CityLink Melbourne Limited (No. 3) [2025] VSC 554 Stynes J considered whether restitutionary interest was available in respect of a claim for moneys had and received. Given that this type of action is conceptually designed to prevent a defendant being unjustly enriched, it has been argued that the defendant should also disgorge the financial benefit involved in having the use of the money.

The Court found that ConnectEast had paid road toll operating fees to CityLink which exceeded the cap set by s 93AB(1) of the Melbourne CityLink Act 1995 (Vic) in the sum of $36m.  ConnectEast was successful in its claim for unjust enrichment and the Court awarded statutory interest of $15m from the commencement of the proceeding.   ConnectEast sought additional interest on a compound basis from the dates of the overpayments. There was no statutory power to award that interest.

The Court considered various UK and Australian decisions, some of which had awarded restitutionary interest in respect of claims of unjust enrichment. The UK Supreme Court had found such an award available and then reversed itself 11 years later. The NSW Court of Appeal had concluded that it was not constrained by dicta of two High Court Judges against the existence of such a right, which dicta was subsequently relied upon by a majority High Court bench in another decision that was also obiter dicta. The latter case simultaneously held out the possibility that a claim for restitution of unjust enrichment may include a claim for compound interest. The authorities are heroically divided.

The Court concluded that, on the basis of dicta in the decisions Commonwealth v SCI Operations (1998) 192 CLR 285 and Northern Territory v Griffiths (2019) 269 CLR 1, the existing state of authority does not favour a free-standing right of restitutionary interest and rejected ConnectEast’s claim for the additional interest.  (The Court also rejected ConnectEast’s claim that it was entitled to restitutionary interest in equity, which had not been developed in argument.) 

The Court stated that:-
(a) unconstrained by authority it would have found for ConnectEast;
(b) the time has come to recognise that in claims for moneys had and received the enrichment includes the use value of the moneys received (at [87]);
(c) if ConnectEast’s claim had been based on a breach of contract there would have been no argument about the availability of a Hungerfords award of damages in the nature of interest and given this, it seems at odds with common sense that the common law does not require the disgorgement of the benefit to the defendant of having had the use of money had and received (at [89]);
(d) so long as an award of restitutionary interest to address a defendant’s unlawful enrichment remains unavailable at common law, there will not be full restitution and that is unjust (at [90]).

This case highlights the need whenever possible to formulate a claim on one of the recognised bases for a non-statutory award of interest – breach of contract, negligence or in equity. It is also unlikely to be the last word on the subject.

Scott Stuckey KC and Graeme Hellyer.
 
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