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Jo C.
Jo C., Barrister
Category: Law
Satisfied Customers: 71153
Experience:  Over 5 years in practice
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I am owed £23,000 from a client I have completed work with,

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I am owed £23,000 from a client I have completed work with, I work in recruitment.
I want to add interest and my T&C's state that, if later than 28 days then I can levy a 3% per day charge. We are no longer in contract as they have sacked all of the recruitment suppliers owing £10's of thousands.
I have attached the section of my terms below
3.3 Time of payment shall be of the essence. If the Client fails to make payment when due, Ltd may (a) suspend performance of the Agreement; (b) terminate the Agreement; (c) levy an administration charge of 5% of the invoice value; and/or (d) (where the amount is overdue by more than 28 days) charge interest on the overdue amount. Interest shall be charged to the Client on a daily basis on all overdue amounts at the annual rate of 3% above the base lending rate from time to time of National Westminster Bank Plc (or, at Ltd’s option, the rate applicable under the Late Payment of Commercial Debts Act 1998) from the due date of payment until the actual date of payment (whether before or after judgment).
Your advice would be appreciated.
Kindest Regards
Thank you for your question. My name is ***** ***** I will try to help with this.
What would you like to know about this please?
Customer: replied 3 years ago.

You've just had the information.. Please answer the question

Your post above does not contain a question?
Customer: replied 3 years ago.

Ok, I want to add interest onto this claim.

Based on what is in my T&C's, can I levy an admin charge of 5% of the total owed and can still add interest at 3% daily?

Or is that 3% annually which is divided by 365 and then multiplied by the number of days late?



Thanks. The way that it’s worded, it is 3% over the Nat West base rate annually divided by 365 and then multiplied by the number of days late.

Fortunately, that is what it says because if it was 3% per day, that is not enforceable and would be struck out if it went to court. The reason is that it would be deemed to be a penalty and penalty clauses are not enforceable in English law.

The 5% single payment is possibly enforceable provided it relates to an administration charge in dealing with the late payment. However in this case, that is £1150 and would also be seen to be a penalty.

If the debt was say £2000 then 5% would be reasonable and would be enforceable.

Can I clarify anything for you?

Customer: replied 3 years ago.

Thanks for that. So in terms of the 5% admin levy. can I add this on based on my T&C's?

Also, could I revert to 8% even if my terms say 3% given that this is law?

The claimant claims interest under section 69
of the County Courts Act 1984 at the rate of
8% a year from 17/11/2014 to 26/11/2014 on
£23,555.70 and also interest at the same rate
up to the date of judgment or earlier payment
at a daily rate of £5.48.

The 5% would be unenforceable because it’s disproportionate to any admin costs.

Your terms and conditions say 3% over base rate and that’s what applies.

The fact that the court rate is higher means that you have actually done yourself a disservice.

You can claim higher amount but it could be disallowed

The way you have calculated it is correct though apart from the interest rate

Customer: replied 3 years ago.

That's great.

Thanks for your help.

No problem. Good luck with the claim.
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