Pendente lite interest in arbitration may be awarded on quantified damages unless the contract clearly and specifically prohibits it.

The SC held that a contractual clause barring interest on earnest money, security deposits and amounts payable under the contract did not, without express wording, exclude pendente lite interest on sums quantified as damages in arbitration. Interest pendente lite compensates a claimant for being kept out of money found due during the lis, and an arbitrator may grant it unless the contract contains a clear and specific prohibition. A general restriction on interest for specified contractual payments cannot be extended to unascertained claims later assessed and awarded as damages. The clause therefore did not bar the award of pendente lite interest.

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Issues: Whether Clause 16(3) of the General Contract Clauses barred the arbitrator from awarding pendente lite interest on amounts found due in arbitration.

Analysis: The contractual clause barred interest on earnest money, security deposits and amounts payable under the contract, but did not expressly prohibit pendente lite interest. The amounts awarded were damages ascertained in the course of arbitration, not sums due under the contract in the ordinary course. Interest pendente lite is attributable to the claimant being kept out of money found due during the lis, and an arbitrator may award it unless the agreement contains a clear and specific bar. A prohibition on interest for specified contract amounts cannot be extended to deny the arbitrator's power to grant interest on unascertained damages once quantified in arbitration.

Conclusion: Clause 16(3) did not bar the award of pendente lite interest, and the arbitrator was entitled to grant it on the amounts found due.

Ratio Decidendi: An arbitrator may award pendente lite interest on damages ascertained in arbitration unless the contract contains an express and specific prohibition against such interest.

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