Connecticut late fee law

8%per year

Attaches to the debt by operation of law when you agreed no rate, so it accrues before any lawsuit and can be stated on a demand letter.

"The compensation for forbearance of property loaned at a fixed valuation, or for money, shall, in the absence of any agreement to the contrary, be at the rate of eight per cent a year" (§ 37-1(a), raised from 6% by P.A. 79-364); unless otherwise agreed, interest at the legal rate accrues as an addition to the debt from the date of maturity (§ 37-1(b)). Separately, § 37-3a caps discretionary prejudgment/postjudgment interest recoverable as damages for detention of money after it becomes payable at 10% per annum. Full chapter text verified on the official cga.ct.gov site.

General usury cap: no person or firm may loan money at more than 12% per annum (§ 37-4). But § 37-9 exempts, among others: loans by banks, out-of-state banks with Connecticut branches, their non-consumer subsidiaries, and credit unions; bona fide real-property mortgages over $5,000; and commercial loans to for-profit entities or business-purpose individuals where the original indebtedness exceeds $10,000 (up to $250,000) provided the rate does not exceed the § 36a-26 deposit index plus 17%. § 37-1a additionally lets commercial loans over $10,000 provide for accrual and compounding of interest. Importantly, § 37-4 targets loans of money - ordinary trade credit on B2B invoices is generally outside it, but recharacterization risk exists.

public+private-construction

Private commercial construction: Conn. Gen. Stat. §§ 42-158i to 42-158j - owner must pay the prime within 30 days of invoice; prime must pay subs/suppliers within 30 days of receiving payment; late payments accrue interest at 1% per month until paid. Public: §§ 4a-71 to 4a-75 (and § 49-41c) - state agencies must pay within 45 days of invoice or receipt of goods/services; late-payment interest equals the monthly effective yield of the state's Short-Term Investment Fund, paid from the agency's administrative funds. No general non-construction private-commercial prompt-pay act found.

No Connecticut statute specifically governing flat late fees on commercial invoices was found; agreed late fees follow the ordinary liquidated-damages/penalty analysis. Two Connecticut-specific wrinkles: (1) § 37-3a caps interest recoverable as damages for detention of money at 10%/yr where no rate was agreed, so courts will not award more than that on an unpaid invoice absent contract; (2) an agreed default-interest rate above 12% on what is functionally a loan of money can be void under § 37-4 unless a § 37-9 commercial exemption applies.