In short, yes. But there are limits on how much you can charge. The problem is, there is no bright line rule.
be the amount of damage sustained because of late payment and that it is impracticable or extremely difficult to fix the actual charge. Failure to pay the fee is a material breach of the lease.
Tips from the California Apartment Association on how you can increase the likelihood of having your fee upheld in court:
Have some information in your file about how you arrived at the amount of the fee, demonstrating the difficulty of determining the actual administrative cost (in addition to interest). You will need this if your fee is challenged in court.
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The court rejected the tenant's first argument that late fees are not impractical to fix because interest is the only damage allowed. The tenant's argument was premised on Civil Code Section 3302, which states that "[t]he detriment caused by the breach of an obligation to pay money only, is deemed to be the amount due by the terms of the obligation, with interest thereon." However, the court ruled that the owner is also entitled to "administrative costs related to collecting and accounting for late payments."
Include language in the agreement stating that the late charge does not establish a grace period and that the parties agree that the charge is presumed to Air Max 95 Ultra Jacquard Black And White
the administrative costs of a late payment, in most circumstances, would not increase markedly from one day to the next. The percentage fee is susceptible to challenge because the portion of the fee the represents administrative costs may not increase proportionate to the amount of rent.
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Put the fee in the rental agreement
Can you charge a late fee for rent in California
Despite the favorable ruling on the validity of late fees in rental agreements, generally, the court ultimately invalidated the fee at issue because the owner had failed to plead or prove that the damages were extremely difficult to fix. The court stated "[a]lthough respondent may have been able to present evidence below that would have shown in this particular case that damages resulting from the late payment of rent were impracticable or extremely difficult to fix, he did not do so." Therefore the late fee was not entitled to the presumption of validity.
Until a couple years ago, there was no reported case in California addressing "late fees" in the landlord/tenant context. In 2004, the Appellate Division of the Superior Court of Los Angeles, in Orozco v. Casimiro rejected the tenant's argument that late fees are always void. In this case a tenant who was assessed a late fee of $50 (on rent of $600/month) argued that a fixed late fee in a residential lease is always void because (1) late fees are only allowed when it is impracticable or extremely difficult to fix actual damages, (2) the landlord is entitled only to interest for late payment of rent; and (3) interest is not impracticable or extremely difficult to fix. The tenant also argued that even if the fees are allowed, the owner must plead and prove that the damages were impracticable or extremely difficult to fix, which he did not do in this case.
A one time fee of a fixed dollar amount is less likely to be viewed as a penalty than a per day fee or percentage. The Nike Air Max 95 Essential Anthracite per day fee is more subject to challenge, since Air Max Bw Ultra Trainer
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