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Dwayne B.
Dwayne B., Attorney
Category: Business Law
Satisfied Customers: 33911
Experience:  Practicing for over 20 years and helped a number of businesses with litigation.
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Dwayne. I am looking regarding late fees

Customer Question

Hi Dwayne. I am looking for information regarding late fees imposed by an elementary school for a late tuition payment--in the state of CA. My payment was 6 hours late because my internet wasn't working and they charged me 6% of the balance due AKA $142. Seems awfully hefty for being a few hours late, and it was my first time ever. Any thoughts?
Submitted: 1 year ago.
Category: Business Law
Customer: replied 1 year ago.
If it helps, the tuition was invoiced on February 1st--oddly, the same day it's "due" and there is a grace period where they don't assess a late fee until the 10th--I paid at 6am on the 11th. I asked them to waive the fee and they said no. I asked them to return the payment to my credit card until March 1st (being I'd already paid the late fee for the month) and they said no.
Expert:  Dwayne B. replied 1 year ago.
Hello and thank you for contacting us. This is Dwayne B. and I’m an expert here and looking forward to assisting you today. If at any point any of my answers aren’t clear please don’t hesitate to ask for clarification. Also, I can only answer the questions you specifically ask and based on the facts that you give so please be sure that you ask the questions you want to ask and provide all necessary facts. Please note: This is general information for educational purposes only and is not legal advice. No specific course of action is proposed herein, and no attorney-client relationship or privilege is formed by speaking to an expert on this site. By continuing, you confirm that you understand and agree to these terms. Please be patient when waiting for a response. I may be looking something up, typing the response, or busy with something else and sometimes it takes a while to respond. I am assuming that the contract allows for the late fee. If not, then there is no basis for them to charge anything. The only other thing I can suggest is to have someone locally review the contract to see if the wording of the contract is okay. I have seen (and been involved in) cases where a late fee wasn't worded correctly and thus an argument can be made that it is equivalent to them charging a usurious amount of interest which negates the fee plus opens them up for damages. The only way to know that is with a review of the contract plus any other paperwork that you have, including the parent version of the student handbooks, etc. Unfortunately, we can't do document reviews which is the reason you have to take it to a local lawyer. They may not charge you just to look it over, you would want to discuss it with them first so you don't end up paying more for the lawyer than you do for the late fee. If it is likely to be usurious then you can make a claim for the attorney's fees as well.
Customer: replied 1 year ago.
So are you saying the school is allowed to charge any amount they want as long as they notified people they would charge that amount? It was not in the contract, as it's a fairly new late fee (it used to be a flat $25/month no matter what your balance and now it's 6% of the balance). When it was changed at the end of last year, they sent out a letter saying it had been changed. I just didn't think they could legally charge people that much and I keep hearing that 1.5% per month is the most someone can charge. Any thoughts on that?
Expert:  Dwayne B. replied 1 year ago.
Kind of. You can contract for almost anything, even if it appears unreasonable. The 1.5% you are hearing about has to do with the usury laws, which is what I recommended you look into. Usury deals with interest rates as opposed to late fees but in some cases the courts have found that the line between the two is blurred and even though someone calls it a late fee it is actually just a way to charge interest.You do have a potential issue with them changing the terms. The argument to make is that they can't just change them without an agreement but it may be that their contract is designed like a credit card contract where they notify you of a change and if you don't cancel the card then it means you agreed to it. That's another reason to have the contract reviewed.
Expert:  Dwayne B. replied 1 year ago.
If your question has been answered then I'd offer my best wishes to you and ask that you please not forget to leave a Positive Rating so I receive credit for my work. Of course, please feel free to ask any follow up questions in this thread.