The American Rule

The American legal system has been, since its inception, adversarial.  This was the intention of its framers and is one of checks on both the judicial system and private citizens that prevents either one of them from using the courts or the law as means to secure unwarranted or unjust rights or benefits.

Many – and for a long time – have argued that the legal system allows those who use it a broad and wide latitude that can be employed in a way that makes it unreasonably expensive, time-consuming, and, even vexatious.  I am often (and by often, I mean, usually) asked whether I can claim or recover the expenses of my client’s fees as part of the case.  It’s almost always asked or demanded in a moment of frustration, when litigation fatigue has set it, or a lawsuit has droned on far longer than the client expected.

My answer is always the same – no.  It’s a qualified no, but no all the same. At the outset of a representation, I let all clients know that what is known as the “American Rule” applies to litigation attorney’s fees.  In short, it means that every party to a lawsuit is responsible for the payment of its own lawyer and the expenses of that representation.  Fees are not ordinarily a part of a party’s losses or damages and the irritations of litigation are not grounds to threaten the other side with a demand for their recuperation.

It’s called the American Rule because, as you have probably surmised by now, other countries have different approaches.  In some countries, the non-prevailing party pays for everyone’s attorney’s fees.  In other countries, a party is entitled to recovery of fees commensurate with the recovery of damages and is responsible for payment of the other party’s fees to the extent he/she/it overstated his/her/its case and caused everyone to spend more money.

Whether or not these are preferable systems to ours is debatable and I have seen the parameters of such a discussion quickly venture into the realm of the esoteric and illogical.  Whatever the case, you should not expect that that litigation comes with a loser pays price tag.

But, here’s where the qualified part of my answer comes into play.  There are two notable exceptions to American Rule.  The first, your dispute centers on a written contract and you (or your contractual partner) had the foresight to include a provision that allowed for the prevailing party to recover its attorney’s fees should any litigation stem from the contract’s performance.  There’s an important point to take notice of here.  Florida follows the rule of reciprocal rights when it comes to contract’s that include attorney’s fees provision.  So, even if a contract states that only one party has the right to seek or recover fees, the law extends that right to all parties.

The second exception, you end up in litigation but fall within the ambit of a statute that includes an express right to recover attorneys’ fees.  Notably, statutes intended to protected individuals in matters of employment and consumer rights, include such provisions.  There are also statutes that shifts the attorney’s fee burden for those parties who frivolously maintain litigation and even force parties to consider the option of settlement or bear the risk of paying their adversary’s fees if they do not prevail at trial or win, but recover less than was offered to compromise the case earlier.