In the American court system, each party to a lawsuit is expected to pay for their own attorney. Thus, judges typically won't order plaintiffs or defendants to pay the other's legal expenses if they lose. However, here are two times when that rule is exempted, and one party may be required to pay the lawyer fees of the other.
The Contract or State Law Requires Payment
It's not unusual for business contracts to contain clauses stipulating the losing side is responsible for paying the winning side's attorney's fees in the event of a lawsuit. The reasons for this provision vary, but most often it's to discourage people from filing frivolous suits.
However, just because a contract says the losing party must pay attorney's fees doesn't mean the judge will order it. The judge will first evaluate the contract to ensure it's fair to both parties and the requirement is reasonable. If the judge feels the agreement is unethical or that the clause was negotiated in bad faith, they will ignore it.
On the other hand, judges generally always follow the requirements of the law. If a state or federal law stipulates the winner in a case should be awarded attorney's fees, then any judgment will typically include it.
It's important to note, though, that the law may only call for attorney fees to be awarded in certain types of cases. For instance, if someone sued and won a case that benefitted the public (e.g. defended and upheld a disputed civil right), then the defendant in the case may be ordered to pay the plaintiff's legal costs.
The Other Party Behaves Badly
Outside of contracts and state laws, judges have ordered people to pay the other party's lawyer fees as a punitive measure against bad behavior. For instance, someone who's filed a series of nuisance lawsuits against the same person may be ordered to pay the winner's legal fees to compensate the victim and deter future unnecessary litigation.
In these situations, the bad behavior is usually so obvious and egregious that the judge feels compelled to act. The judge may not say anything to a plaintiff who sues thinking they won't win. However, the same judge may punish a plaintiff who files a baseless suit knowing they had no legitimate grounds (i.e. reasons) to do so by ordering the plaintiff to pay the defendant's legal fees for wasting the court's and the person's time.
In general, though, you shouldn't expect to be awarded attorney's fees when you win your case. If you feel you have a case but aren't sure you can pay, consult with an attorney anyway. They will usually work out a fair payment plan so you can get the representation you need in your lawsuit.
For more information about corporate law, reach out to a local law firm.Share
13 November 2020
While I took a few business classes in college, I left early to start my own business. I thought I had the knowledge I needed to become a great business owner and was eager to start my business. Soon, I had a new business that was actually performing pretty well in sales. Unfortunately, I hadn't taken any law courses in college, and I soon realized I made a few mistakes when starting my business that could cause me some legal trouble. Thankfully, a great business lawyer helped me correct my mistakes before I had any legal problems, but I then decided to take those business law courses. I want to help business owners and anyone else who would like to learn more about the law by starting a blog where I will share what I have learned and will continue to learn. I hope I can help you!