Baltimore, MD asked in Consumer Law for Maryland

Q: Can I charge a 1.5% per day late fee as long as it doesn’t exceed a total of 10% for the month? It will cut off at 10.

I’m a freelance web designer. My payment and late fee section states payment is due 14 days after invoice date. After that, a 1.5% per day late fee is assessed.

The Client is flexing his retired lawyer muscles and saying I’m violating the law with this request. However, Maryland Code Commercial Law Title 14 - Misc Consumer Protection Provisions Subtitle 13 - Misc Provisions Section 14-1315 - Late Fees states up to 10% per month can be charged.

So for instance, if the Client is 15 days late, instead of just dropping a full 10% late fee on them, on the 16th day, I do 1.5%. If they pay me then, they’ve only been charged 1.5% as opposed to the full 10. Does this make sense?

My contract was prepared using an online contract service. I’m not sure how my contract is wrong considering that. Maybe it just needs clearer definition?

Related Topics:
1 Lawyer Answer
Joseph D. Allen
Joseph D. Allen
  • Hunt Valley, MD
  • Licensed in Maryland

A: On the surface, I see no reason you couldn't structure your late fee in that manner. But you should clearly say it is capped at 10% per late payment. Or, you could charge the 10% on the 15th day with a discount credited if they paid between 15 and 22 days late. Or, just keep it simple and charge the 10%.

Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.

The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.

Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.