Default interest vs default damage

The creditor has the right to charge a default interest of 5% per annum to a debtor who is in default of payment of a (legitimate) claim. However, it is often the case that creditors – especially in business dealings – charge a higher default interest or default. This often consists of dunning fees and other fees.

However, this is only permitted if the debtor has contractually agreed to this delay damage (usually via the General Terms and Conditions, GTC) or if the creditor has actually suffered additional, specifically determinable financial damage as a result of the delay in payment. This is usually not the case. Therefore, if the creditor does not manage to actually prove his additional damage, the delay damage is not owed, only the default interest.

If the debtor is charged for damages caused by delay, the latter should notify the creditor as soon as possible that he will not pay the damages caused by the delay (the remainder, ie the claim and the default interest, should also be paid as soon as possible if the claim rightly exists). If the creditor operates the debtor, the debtor should make a partial legal proposal (Rechtsvorschlag) regarding the damage caused by default. If the creditor can prove no additional, determinable, financial damage, he will not penetrate with the delay damage.