By: J. Matthew Kelly, Esq.
Clark, Campbell, Lancaster & Munson, P.A.
One of the most common questions I receive as a litigation attorney is: “Does the opposing party have to pay my attorney’s fees if I win?” The general answer of “no” often surprises people, however, there exists many exceptions to this general rule.
The American Rule
Florida, and the majority of states and jurisdictions in the United States of America follow the American Rule. The American rules provides that attorney’s fees can only be awarded to a party if authorized by the contract of the parties or authorized by statute.
Attorney’s Fees Provisions by Agreement
One of the most common ways a prevailing party can recover its attorney’s fees is if the agreement or contract which is being disputed has an attorney’s fees provision. As previously mentioned, an exception to the American Rule is when the parties expressly agree that a prevailing party will be entitled to fees.
It is very important when entering, drafting, or creating contracts to consider whether an attorney’s fee provision will best suit your objectives. If you are a party to a contract and a lawsuit results from an alleged breach of that contract you will be paying your own fees, even if you prevail, if the contract is silent as to attorney’s fees. Having an attorney’s fee provision in the contract can deter frivolous litigation as a party is less likely to bring a baseless lawsuit if it will be responsible for the other party’s attorney’s fees. On the other hand, not having an attorney’s fee provision can also help deter litigation in certain situations as litigation can be costly and without the ability to recover their fees a party may refrain from filing a lawsuit.
It is not uncommon to see contract with a one-sided attorney’s fee provision. A one-sided attorney’s fee provision is an attorney’s fee provision which only allows one party to the contract to recover its attorney’s fees in the event of legal action on the contract. In Florida, if the contract only provides that one party will be entitled to attorney’s fees the court may also allow the other party to recover attorney’s fees if the other party prevails in the legal action.
Statutory Authorization to Attorney’s Fees
The other way a party in a legal action can seek to recover its attorney’s fees is if a statute authorizes attorney’s fees.
Some common proceedings where a statue authorizes attorney’s fees are as follows: landlord tenant disputes relating to non-payment of rent, many disputes relating to homeowners’ associations, disputes relating to the Florida Deceptive and Unfair Trade Practices Act, disputes where an insured prevails against an insurer, and in many family law proceedings including dissolution of marriage.
Two other common statutory mechanisms for seeking attorney’s fees are Florida Statutes Section 57.105 and Florida Statutes Section 768.79.
Florida Statutes Section 57.105 allows for a party to seek to recover its attorney’s fees in relation to unsupported claims or defenses. When a litigant is met with a frivolous claim he or she can use Section 57.105 as a mechanism to attempt to recover attorney’s fees. In certain circumstances under Section 57.105 the attorney who filed the frivolous motion can be forced to pay a portion of the attorney’s fees. Section 57.105 has many requirements that need to be followed before a court will consider awarding fees. One such requirement is that the party seeking to use Section 57.105 against a frivolous claim must serve the other party with the proposed motion, and typically a letter, allowing a twenty-one (21) day window for the offending party to withdraw or correct its claim.
Florida Statutes Section 768.79 governs “offers of judgment” which are offers from one party to another to settle the case for a certain amount. Any such offer must also comply with Florida Rules of Civil Procedure 1.442. Generally, this works by allowing a plaintiff to present an offer to the defendant. If, the defendant accepts the offer of judgment the case ends at the point. However, if the defendant rejects the offer of judgment and the plaintiff ends up prevailing and receiving a judgment in an amount which as at least twenty-five (25) percent greater than the offer of judgment, then the Plaintiff will be entitled to recover attorney’s fees that were incurred from the date of filling the offer forward. Defendants can also make offers under this provision but will only be entitled to fees if the plaintiff’s judgment is at least twenty-five (25) percent less than the defendant’s offer.
It is important to have an attorney review and draft contracts when possible to help determine whether an attorney’s fee provision is right for your situation. It is equally as important to have an attorney handle the bringing or defending of any claim to make the determination of whether or not you will be able to recover your attorney’s fees if you prevail. Importantly, litigants must request attorney’s fees in the initial pleadings or they waive the ability to recover such fees. Once a party prevails that party must move for its attorney’s fees within thirty days or again it will lose the ability to seek them. Many of these mechanisms involve significant judicial discretion as to entitlement and amount.
J. Matthew Kelly is an attorney with the law firm Clark, Campbell, Lancaster & Munson, P.A. in Lakeland. Questions can be submitted to email@example.com.
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