Collect unpaid invoices and enforce contracts as an independent contractor in California. Learn your rights under California Labor Code and contract law.
$12,500
Small Claims Limit
4 Years
Written Contract SOL
10%
Statutory Interest Rate
Collecting Unpaid Freelance Invoices in California
Getting paid for your work is a fundamental right. When clients don't pay freelancers and independent contractors, California law provides multiple pathways to recover the money you're owed - from demand letters to small claims court to civil litigation.
Key Advantage: A properly drafted demand letter resolves most freelancer payment disputes without court involvement. Clients who receive a professional demand letter citing California law typically pay within 2-4 weeks to avoid litigation costs and potential additional liability.
Common Nonpayment Scenarios
Scenario
Description
Recovery Approach
Invoice Not Paid
Client received work but hasn't paid within agreed terms
Demand letter, interest, small claims
Partial Payment
Client paid some but disputes remaining balance
Document scope, demand balance plus interest
Scope Creep Dispute
Client claims work exceeded original scope
Contract interpretation, change order evidence
Quality Dispute
Client refuses payment claiming work was substandard
Document delivery, industry standards
Ghost Client
Client disappeared after receiving work
Skip tracing, default judgment, collections
Your Recovery Options
Demand letter: Often resolves disputes without court
Small claims court: Up to $12,500, no attorney needed
Send formal demand: Certified mail, specific deadline
Know your deadlines: 4-year SOL for written contracts
Employee vs. Contractor: If you might be misclassified as a contractor when you should be an employee, different (and often stronger) laws apply. California's AB5 law presumes workers are employees unless the ABC test is satisfied. Misclassified workers can file wage claims with the Labor Commissioner.
California Law for Freelancer Payment
California provides several legal frameworks for collecting unpaid invoices, depending on whether you have a written contract, the amount owed, and your classification as a worker.
California Contract Law
Civil Code 1549-1701
Governs contract formation, interpretation, and breach. Written contracts have stronger enforcement than oral agreements. Provides remedies including specific performance, damages, and contract rescission.
Prejudgment Interest
Civil Code 3287-3289
Allows creditors to recover interest on amounts due. For written contracts, you can charge 10% annual interest from the date payment was due. For oral contracts, 7% interest applies. Contract rate applies if specified (up to 10% for consumer transactions).
California Labor Code (If Misclassified)
Labor Code 200-244
If you should be classified as an employee, California Labor Code provides additional protections including waiting time penalties (up to 30 days wages), expense reimbursement, and PAGA penalties. File a wage claim with the Labor Commissioner.
Statutes of Limitations
Claim Type
Deadline
Code Section
Written Contract
4 years from breach
CCP 337
Oral Contract
2 years from breach
CCP 339
Accounts Stated (Invoices)
4 years
CCP 337(2)
Quantum Meruit (No Contract)
2-4 years
CCP 339/337
Fraud
3 years from discovery
CCP 338(d)
Interest Calculation
Contract Rate
If your contract specifies an interest rate for late payment, that rate applies. California caps interest at 10% for consumer transactions but allows higher rates for business-to-business contracts (though courts may find excessive rates unconscionable).
Statutory Rate
Without a contract rate:
Written contract: 10% per year (Civil Code 3289)
Oral contract: 7% per year (Civil Code 3289)
Interest accrues from date payment was due
Accounts Stated Doctrine: When you send an invoice and the client doesn't object within a reasonable time, California law treats it as an "account stated" - an implicit agreement on the amount owed. This strengthens your collection position and simplifies proving your case.
California Small Claims Court for Freelancers
Small claims court is often the best option for collecting unpaid freelance invoices up to $12,500. It's fast, inexpensive, and you don't need an attorney.
Small Claims Basics
Advantages
Maximum claim: $12,500 for individuals
Filing fee: $30-$75 depending on amount
No attorney required (or allowed)
Informal procedures
Decision usually same day
Cases heard within 30-70 days
Limitations
No attorney representation at trial
Limited to 2 claims over $2,500/year
Defendant can appeal (plaintiff cannot)
Collecting judgment is separate process
Must sue in proper county
Filing Process
1
Send Demand Letter First
California courts expect you to try resolving disputes before filing. A demand letter shows good faith and often gets results without court.
2
File SC-100 Form
Complete the Plaintiff's Claim form. File in the county where: defendant lives/does business, contract was signed, or work was performed. Pay filing fee ($30-$75).
3
Serve the Defendant
Have someone 18+ who is not a party serve the defendant. Can use process server ($50-$100), sheriff ($40), or friend. Must be served at least 15 days before hearing (20 days if outside county).
4
Prepare Your Case
Organize: contract, invoices, emails, proof of work, demand letter, evidence of nonpayment. Practice a brief (2-3 minute) summary of your claim.
5
Attend Hearing
Arrive early, dress professionally. Judge will ask you to explain your claim, then hear defendant's response. Bring 3 copies of all documents.
Where to Sue
You must file in the correct county. For contract cases, venue is proper in:
Where the defendant lives or does business
Where the contract was signed
Where the contract was to be performed
Where the defendant has an agent (for businesses)
Collecting Your Judgment: Winning is only half the battle. If the defendant doesn't pay voluntarily, you may need to use wage garnishment, bank levy, or property liens. California provides various enforcement tools, but collection takes additional effort.
Documentation for Freelancer Payment Claims
Strong documentation dramatically increases your chances of collecting unpaid invoices, whether through demand letters or court. Start organizing evidence immediately when payment issues arise.
Contract Documents
Signed contract or agreement
Proposal or quote that was accepted
Email chain establishing terms
Statement of work (SOW)
Change orders or scope modifications
Payment terms and deadlines
Invoices and Payments
All invoices sent with dates
Partial payments received
Payment reminders sent
Late fee notices
Interest calculations
Account balance summary
Proof of Work
Deliverables (copies or screenshots)
Time tracking records
Project management logs
Client feedback/approvals
Final delivery confirmation
Work samples with timestamps
Communications
All emails with client
Text messages about payment
Slack/Teams conversations
Phone call notes with dates
Client's excuses or promises
Demand letter and response
Creating a Chronological Timeline
For court or demand letters, create a clear timeline showing:
Contract date: When you agreed to work
Work performed: When services were delivered
Invoice date: When you billed the client
Due date: When payment was required
Follow-up dates: When you requested payment
Client responses: Any promises or excuses
Demand letter date: When formal demand was sent
No Written Contract? You can still recover for work performed under quantum meruit ("as much as deserved"). Gather evidence of: work requested, work performed, client's acceptance or use of work, and reasonable value of services. Market rate evidence from similar projects helps establish value.
Sample Freelancer Nonpayment Demand Letter
Use this template for demanding payment of unpaid invoices. Customize the bracketed sections for your situation.
[Your Name / Business Name]
[Your Address]
[City, CA ZIP]
[Your Email]
[Your Phone]
[Date]
[Client Name]
[Client Company, if applicable]
[Client Address]
[City, State ZIP]
Via Email: [Client Email]
Via Certified Mail, Return Receipt Requested
Re: Demand for Payment - Past Due Invoice(s)
Invoice Number(s): [#####]
Original Amount: $[Amount]
Interest Accrued: $[Amount]
Total Due: $[Amount]
Dear [Client Name]:
I am writing to demand immediate payment of $[Total Amount] for professional services I provided to you/[Company Name] that remain unpaid despite my previous requests.
BACKGROUND
On or about [Date], we entered into an agreement for [description of services: e.g., "web development services," "graphic design work," "content writing"]. Under our agreement, I was to [brief description of scope] and you agreed to pay $[Amount] upon [completion/delivery/milestone].
I completed the agreed-upon work and delivered [deliverables] on [Date]. You acknowledged receipt and [approved the work/made no objections] on [Date]. My invoice #[Number] was issued on [Date] with payment due [Date/terms, e.g., "Net 30"].
AMOUNTS OWED
Despite multiple requests for payment, the following amounts remain outstanding:
Invoice #[Number] - [Date] - $[Amount]
[Additional invoices if applicable]
Subtotal: $[Amount]
Interest (10% annual from [Due Date]): $[Amount]
Total Due: $[Amount]
Under California Civil Code Section 3289, I am entitled to prejudgment interest at 10% per annum on amounts due under our written agreement.
DEMAND
I hereby demand payment of $[Total Amount] within ten (10) days of your receipt of this letter.
CONSEQUENCES OF NON-PAYMENT
If I do not receive full payment by [Deadline Date], I will pursue all available legal remedies, including but not limited to:
1. Filing a lawsuit in California Superior Court or Small Claims Court;
2. Seeking recovery of the principal amount, accrued interest, court costs, and any attorney fees permitted by law or contract;
3. Reporting the debt to credit reporting agencies;
4. Pursuing wage garnishment, bank levies, or other judgment enforcement remedies.
SETTLEMENT OFFER
To avoid litigation costs for both parties, I am willing to accept $[Slightly Reduced Amount] as full settlement if received within ten (10) days. This offer expires if not accepted by [Date] and is made without prejudice to my right to seek the full amount plus all applicable interest, costs, and fees.
RESPONSE REQUIRED
Please remit payment to:
[Your Name]
[Payment Address or instructions]
Or via [Zelle/Venmo/PayPal] to [your email/phone]
Or via wire transfer to [bank details if comfortable providing]
If you dispute any portion of this demand, please provide a written explanation within ten (10) days. Failure to respond will be treated as an acknowledgment of the debt.
This letter is intended as a final opportunity to resolve this matter without legal action. I trust you will give this matter the immediate attention it requires.
Sincerely,
[Your Signature]
[Your Printed Name]
[Your Business Name, if applicable]
Enclosures:
- Copy of signed contract/agreement
- Invoice(s) #[Numbers]
- Proof of delivery/completion
- Prior payment request emails
Important: Send via certified mail, return receipt requested, AND email. Keep copies of everything. The 10-day deadline creates urgency - adjust based on your situation and any contractual requirements. If you plan to file in small claims court, some courts require a demand letter before filing.
How I Handle California Freelancer Payment Cases
I help freelancers and independent contractors in California collect unpaid invoices through demand letters, negotiations, and litigation support when needed.
Case Evaluation
Review your contract and documentation
Assess strength of your claim
Calculate principal, interest, and potential fees
Determine best recovery strategy
Demand Letter Drafting
Professional attorney-drafted demand
California law citations and leverage
Settlement framework
Clear deadlines and consequences
Litigation Support
Small claims preparation and coaching
Civil court representation
Contract dispute litigation
Judgment enforcement guidance
Typical Results
Most disputes resolved with demand letter
Average 2-4 week resolution time
Full recovery including interest common
Small claims wins for amounts under $12,500
Client Not Paying Your Invoice?
I help California freelancers and contractors collect what they're owed. Contact me for a case evaluation.
Freelancer nonpayment cases are typically handled on:
Flat fee: $350-$500 for demand letter preparation
Contingency: 25-33% of recovery for cases requiring litigation
Small claims coaching: $200 flat fee for preparation and strategy
Hourly: $240/hour for complex matters or civil court cases
Free Initial Review: I review freelancer payment disputes at no charge to assess whether a demand letter is likely to succeed. Send your contract, invoices, and key communications to owner@terms.law with "Unpaid Invoice" in the subject line.