Legal Question in Landlord & Tenant Law in California

Subdivision (a) of section 827 applies to all tenancies. Subdivision (b) is clear from its terms that it applies to residential tenancies.

With respect to late fees, the general rule is that the law abhors a penalty. Courts in California are reluctant to enforce a late payment fee that is a severe penalty. On the other hand, a court will be more likely to enforce a "liquidated damage" provision that attempts to adequately compensate the parties for a breach. So a late fee that covers fees that a landlord may have to pay on a late loan payment as a result of late payments from a tenant could be upheld, but a blanket severe penalty of 50 percent of the rent would not likely be upheld in court.