Restitution and interim stay interest liability upheld on withheld penalty amount after the substantive challenge failed.

Interest on a penalty amount withheld under an interim stay remains payable when the substantive challenge fails, because restitution requires the party benefiting from the stay to restore the other side to the position it would have occupied but for the interim order. Unless the stay order or final order expressly excludes interest, the statutory or contractual rate governs liability for the withheld sum. Applying that principle, the appellants were found liable to pay interest on the amount kept back during the stay period, and the demand notice for interest was upheld.

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Issues: Whether the appellants were liable to pay interest on the penalty amount during the period when recovery was stayed and the amount was withheld pursuant to interim orders.

Analysis: The liability to pay interest for the period covered by an interim stay was held to follow the principle of restitution. Where an interim order permits withholding of money and the substantive challenge ultimately fails, the beneficiary of the stay cannot avoid interest on the amount kept back, unless the order granting stay or the final order specifically provides otherwise. The decision relied on the settled principle that a party should be restored to the position it would have occupied but for the interim order, and that the statutory or contractual rate of interest, where applicable, governs such liability.

Conclusion: The appellants remained liable to pay interest on the withheld penalty amount, and the demand notice for interest was upheld.

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