An attorney’s fee clause is a provision requiring a party to pay the legal costs of another party. While the United States inherited much of its legal framework from the United Kingdom, the two nations differ on how attorney’s fees are awarded. Under the English rule, the losing party is responsible for paying the attorney’s fees of the prevailing party. The American rule, on the other hand, requires each party to pay their respective fees and costs. However, the American rule does provide for two circumstances in which the losing party will have to pay the attorney’s fees of the prevailing party. This is allowed if there is a contractual clause indicating such, or if a statute grants attorney’s fees.
Under a unilateral attorney’s fee clause, only one party may benefit from the award of attorney’s fees. For example, if A and B have a contract which states that B must pay A’s attorney’s fees in the event of a dispute in which A prevails, the clause is unilateral. A multilateral attorney’s fee clause simply states that the prevailing party’s reasonable attorney’s fees will be paid by the opposing party.
Does Florida allow unilateral attorney’s fees provisions?
Florida law does not allow unilateral attorney’s fee clauses. Instead, Section 57.105(7) of the Florida Statutes converts every unilateral clause into a multilateral clause. The statute states that if a contract grants attorney’s fees to a party, and that party is required to go to court in order to enforce the contract, the court may also allow reasonable attorney’s fees to the opposing party if it were to win in the action. Essentially, Florida courts interpret all attorney’s fee clauses as being multilateral, regardless of the language of the contract.
What is a prevailing party?
A prevailing party is the party that succeeds in a lawsuit. Most attorney’s fee provisions use the term prevailing party to indicate the party responsible for paying the fees of another. For example, if A sues B for breach of contract and succeeds, and the contract between them states that the prevailing party will be awarded a reasonable attorney’s fee, then B will be liable for A’s legal costs.
When are attorney’s fees awarded by statute in Florida?
Florida’s attorney’s fee statute, § 57.105 Fla. Stat. (2021), awards a reasonable attorney’s fee to the prevailing party, regardless of any contractual provision, in two circumstances. A prevailing party will be awarded attorney’s fees if the court determines that the losing party knew or should have known that their claim or defense: (a) was not supported by the material facts needed to establish the claim or defense, or (b) would not be supported by the application of then-existing law to the material facts.