Generally speaking must late fees have some sort of cap or limit? For example if it were the libraries policy could they really charge $100 per day for unreturned books? A more realistic example, often contractors have a late fee for late payments. Could it accumulate indefinitely (for example $10 per day) or must it be a flat rate or have an upper limit (for example it stops after 14 days)?

  • 2
    Library "late" fees and contractor "late" fees are two charges of rather different nature. For charges due to late payment, it is considered as interests and federal criminal usury law applies.
    – xngtng
    Commented Mar 29, 2021 at 17:29
  • @zhantongz my experience (in the US, so possibly not directly applicable) is that fees for late payment may be distinct from interest. TwoTwins: I don't know whether provincial law is relevant, but it might be. Are you interested in a particular province?
    – phoog
    Commented Mar 30, 2021 at 12:28
  • @phoog Certain justified, flat, small administrative charges may be allowed as a distinct item, but accumulating or percentage charges are usually considered as interests, e.g. scc-csc.lexum.com/scc-csc/scc-csc/en/item/2138/index.do. Provincial laws on consumer protections may also apply.
    – xngtng
    Commented Mar 30, 2021 at 13:52
  • FWIW, Colorado enacted statutory limits on late fees in residential leases in the 2021 legislative session. 9news.com/article/news/local/local-politics/…
    – ohwilleke
    Commented Aug 27, 2021 at 0:23

1 Answer 1


Fees, damages, fines and penalties

A library late fee is probably not a fee - it’s either damages or a fine.

A fee is an amount charged/paid for the provision of a service. An architect charges a fee to design your house. The DMV charges a fee to issue your drivers licence.

Damages are what you pay to compensate someone for harming them. The harm can be physical or economic, and can come from breach of contract or a tort. Late fees charged under your contract with the library are to compensate them for you breaching the contract by not returning the book on time. When a specific figure is in the contract to start with, this is called liquidated damage. The figure must be a genuine pre-estimate of the cost to the library for a beach, if not, into a penalty (q.v.).

Fines are what a government charges you when you break the law. The fine can be any amount that the law allows. If your library is a public library then the late fee may actually be a fine. If so, it must be no more than the amount legislated or regulated.

Penalties are attempts to punish someone for breaking a contract. Damages become a penalty when they are excessive and punitive rather than restorative. Penalties are unenforceable.

  • For example from Docracy. "Overdue balances may be charged a monthly service fee of .5% (or the greatest amount allowed by law)." Which law may control the maximum amount of a late fee?
    – TwoTwins
    Commented Apr 6, 2021 at 10:46
  • @TwoTwins if you have a question, ask a question
    – Dale M
    Commented Apr 6, 2021 at 12:05

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