Legal Definitions - nonpayment

Nonpayment refers to the failure to provide money or other agreed-upon assets when they are required to fulfill a financial or contractual responsibility.

Here are some examples illustrating nonpayment:

• Imagine a small business, "Fresh Bites Bakery," orders a large shipment of flour from a supplier. The invoice states that payment of $1,500 is due within 30 days of delivery. If Fresh Bites Bakery fails to send the $1,500 to the supplier by the specified due date, this constitutes nonpayment. They have failed to deliver the required money to discharge their obligation for the goods received.

• Consider a homeowner, Mr. Henderson, who has a mortgage on his house. His monthly mortgage payment of $1,200 is due on the first day of each month. If Mr. Henderson does not send his payment to the bank by the due date, he is in nonpayment. He has failed to provide the money required to fulfill his ongoing financial obligation under the mortgage agreement.

• Suppose a freelance graphic designer, Ms. Chen, completes a logo design project for a client. Their contract specifies that the final payment of $750 is due upon completion and approval of the design. If the client approves the design but then fails to transfer the $750 to Ms. Chen, this is an instance of nonpayment. The client has failed to deliver the agreed-upon money to discharge their contractual obligation for the services rendered.