0

For US-Law:

Can a freelancer charge a client late fees for late payments if they are not explicitly drawn out in a contract?

For example, let's say the freelancer has a contract for an hourly rate only, and no articles related to fees. However, the client has not paid for weeks and the freelancer notifies them he will charge a late fee if not paid in n days.

Is this viable? Will it holdup? Or is it an ambiguous situation?

2
  • Is a time for payment stated in the contract?
    – Dale M
    Apr 3 '19 at 11:16
  • No but it was stated on the invoice terms that it is due immediately upon receipt Apr 3 '19 at 11:24
2

In the absence of a time for payment, payment is due in a reasonable time. What is reasonable depends on all the factors of the relationship including things like prior dealings, industry norms, the nature of the work etc.

The OP has stated in a comment that the invoices were due “immediately” - this is not reasonable for a “freelancer” arrangement. Between 7 and 60 days is more likely the bounds of “reasonable”.

In the absence of a contractual provision, the contractor is not entitled to late fees or interest, particularly where it is unclear what is late and what isn’t.

If the non-payment persisted beyond what was reasonable the contractor could sue and the court would determine a definite date on which payment was due and the judgement would create a debt. The contractor would be entitled to interest on the judgement debt because that is a statutory rather than a contractual entitlement.

3
  • Thanks for the answer. One other question, if the invoice terms had a "reasonable" payment deadline, would that then be valid for the late fee according to the terms? Apr 3 '19 at 11:56
  • 1
    @hisairnessag3 It would be much clearer if any such fees were stated in the contract itself. If a due date and a late fee were specified in the invoice (only) it might be collectable if the due date was on the long side of reasonable. That would depend on state law and case law in the US. Apr 3 '19 at 12:10
  • @DavidSiegel also, fees to recover costs are ok, penalties designed to punish are not. Interest is better than a fee for that reason.
    – Dale M
    Apr 3 '19 at 20:04

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.