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Who Pays the Attorneys’ Fees? Understanding the ‘American Rule’

Money

If you are considering bringing a lawsuit or if your company is being sued, it is normal to be worried about the possible cost of litigation. You may be wondering: Can I get the other party to pay my attorneys’ fees and legal costs? The answer is “it depends”—though it is certainly possible in some cases.

Florida operates under the ‘American Rule’, meaning each party to a dispute is assumed to be responsible for their own attorneys’ fees. That being said, the ‘American Rule’ is only a default rule. There are circumstances in which you can recover compensation for legal costs. Here, our Miami business litigation attorneys highlight the three basic ways you can get your attorneys’ fee paid by the other party.

When Can I Recover Attorneys’ Fees in a Lawsuit in Florida? 

  1. The Contract Calls for Fee-Shifting

Are you involved in a breach of contract dispute or any other type of contract-based litigation? If so, you may be eligible to recover compensation for your attorneys’ fee. The court will look at the terms of the contract. If the contract contains a “loser pays” provision or any other type of contract language that calls for fee-shifting, then you may be eligible to get compensation for your legal costs. 

  1. A Statute Provides for Recovery of Attorneys’ Fees

As was mentioned, the ‘American Rule’ on attorneys’ fees is only a default assumption. It is only applicable if the statute in question does not speak to fee shifting. However, in many cases, specific statutes allow for the recovery of attorneys’ fees by the successful party.

As an example, the Florida Condo­minium Act often allows the prevailing party to recover attorneys’ fees. If you are filing a lawsuit or being sued, make sure you review the specific statute under which the legal claim arises. Attorneys’ fees may be a statutory remedy. 

  1. Equitable Remedy: The Wrongful Act Doctrine

Finally, Florida courts also recognize that attorneys’ fees can sometimes be awarded as an equitable remedy under a legal theory known as the Wrongful Act Doctrine. This is a complicated legal rule that sometimes allows wronged parties to recover compensation for attorneys’ fees and legal costs despite the lack of a contract or relevant statute.

As explained in the Florida Bar Journal, innocent parties that have incurred legal costs due to the wrongful conduct of another party may be awarded attorneys’ fees. It should be noted that the Wrongful Act Doctrine is applied in a relatively narrow manner. Florida courts require strong, compelling evidence of a wrongful act to award legal fees as an equitable remedy.

Get Help From a Florida Business Lawyer Today

At Pike & Lustig, LLP, our Miami business litigation attorneys provide skilled, fully personalized legal guidance to our clients. If you have questions about attorneys’ fees or business law in general, call us now for a free, confidential consultation. We have law offices in West Palm Beach and Miami, from which we represent businesses and individuals throughout South Florida.

Resource:

floridabar.org/the-florida-bar-journal/the-wrongful-act-doctrine-a-common-law-exception-to-the-american-rule-on-entitlement-to-attorneys-fees-in-florida/

https://www.turnpikelaw.com/11-steps-to-secure-your-businesss-trade-secrets-and-prevent-litigation/

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