Lindsay Lohan has settled an unpaid bill for stereo equipment.

Earlier this week, it was reported Stephen Clark had taken legal action against the troubled actress alleging she had failed to pay for a sound system and its instillation into her Californian home, but he has now cancelled the lawsuit after she handed over the cash for his work.

Stephen - who had sued for $1,180 - told gossip website TMZ: "She paid and I cancelled the small claims file.

"Lindsay is actually really nice and I think my invoice got mixed up or something ... It's all good now!"

Stephen had been seeking $1,180 from the actress for

The case was the latest in a string of problems for Lindsay, who had the equipment installed while she was under house arrest.

The 'Mean Girls' actress was freed on 29th June after serving 35 days of house arrest for the theft of a necklace from an upmarket boutique and for violating the terms of probation set for her 2007 conviction for driving under the influence (DUI).

Last week, Lindsay - who has also started 480 hours of community service at the Los Angeles Downtown Women's centre as part of her sentence - appeared in court for a progress hearing, where she was ordered to find an individual therapist.

However, during the hearing, the 25-year-old actress' lawyer insisted she hadn't been able to have the mandatory psychological treatment due to "financial issues".