Can You Recover Attorney Fees in California Lawsuits?
Dec. 28, 2022
Going to court to resolve a dispute or seek compensation for damages you suffered can be an expensive proposition. Sometimes, the cost of attorneys’ fees can outweigh any gain you might make by prevailing in your lawsuit. The question many have is, “Can I recover my attorney’s fees if I win?”
Generally speaking, California follows what is known as the “American Rule,” which requires that all parties pay their own attorneys’ fees, even if they win at trial. Fortunately, there are exceptions, especially when it comes to cases involving contracts. Carefully drawn contracts will always contain attorneys’ fees provisions, which hold that the prevailing party is entitled to recovery for their legal costs.
There are other occasions when it may become possible to recover attorneys’ fees as well, but in every lawsuit – whether you’re initiating it or fighting it – you need to weigh the costs of litigation against the possible reward.
If you’re facing or involved in litigation in or around Irvine, California, contact William B. Hanley, Attorney at Law. With more than 40 years of experience in business law, he will analyze the issues at hand, advise you of the best course of action, and aggressively represent you should a trial proceed.
William B. Hanley, Attorney at Law, also proudly serves clients throughout the Southern California counties of Orange, San Diego, and Los Angeles.
Recovering Attorneys’ Fees in a Contract Dispute
California Civil Code Section 1717 covers the reward of attorneys’ fees in contractual disputes. The specific language states that “the party who is determined to be the party prevailing on the contract, whether he or she is the party specified in the contract or not, shall be entitled to reasonable attorney’s fees in addition to other costs….”
This code applies when the contract being litigated includes an attorneys’ fees clause, which provides for the prevailing party to be compensated. Note that the code uses the phrase “reasonable attorney’s fees in addition to other costs.” If the contract lacks the provision, or if the attorneys’ fees clause is ambiguous, then there may be difficulty in recovering legal costs.
Recovering Under Frivolous Lawsuits
Another California statute, the Code of Civil Procedure Section 128.5, addresses “bad faith” or “frivolous” legal actions. The code states: “A trial court may order a party, the party's attorney, or both, to pay the reasonable expenses, including attorney's fees, incurred by another party as a result of actions or tactics, made in bad faith, that are frivolous or solely intended to cause unnecessary delay. This section also applies to judicial arbitration proceedings under Chapter 2.5….”
Bad faith applies to actions or tactics, which include making or opposing motions or the filing and service of a complaint. Frivolous is defined as “totally and completely without merit or for the sole purpose of harassing an opposing party.”
If you want to learn more, reach out to a reliable attorney for proper assistance.
Other Routes to Recovering Attorneys’ Fees
The concept of implied indemnity allows you to recover attorneys’ fees if you must defend yourself in a lawsuit because of someone else’s actions. Say you’re the contractor on a construction site, and a subcontractor does something that causes damage or loss for the owner.
The owner sues you because you’re the general contractor, but the subcontractor is actually at fault. You can then recover attorneys’ fees from the subcontractor under the concept of implied indemnity.
It is also sometimes possible to recover attorneys’ fees when an insurer uses “bad faith” tactics to deny a claim you make. This can be often pursued even if the insurance policy in question is silent on the issue.
Seek Trusted Legal Assistance
If a lawsuit is looming or has already been initiated, you’re going to need to explore your options and weigh the chances that pursuing the action or defending against it may outweigh the potential benefits. One important aspect of your decision will be determining if there’s a chance of recovering your legal fees. For that, you’re going to need experienced legal counsel who can counsel you on your options and obligations.
William B. Hanley, Attorney at Law, stands ready to consult with you, assess the issues at hand, and provide you with concrete advice and representation. If you’re in or around Irvine, California, reach out immediately.