Can I get attorney fees if I win my case?

Almost every plaintiff will ask this question. It seems like a fair one. If I have to resort to the courts to enforce a contract, shouldn't the offending party have to pay for it? Of course, the standard lawyer answer is "it depends".

Historically in North Carolina, attorney's fees were not awarded outside of a few narrowly defined types of cases. In 2011, the General Assembly passed General Statute § 6-21.6, which allows for the award of attorney's fees in commercial contracts if (AND THIS IS THE IMPORTANT PART) such a provision was included in the contract. Let me share a story to illustrate the importance of this.

Several years ago when I was a contractor, I was personally sued by a sub-contractor claiming fraud as a result of a contract dispute. It was a meritless claim intended to gain leverage and force me to settle. Suddenly, this $25,000 dispute became a $750,000 headache and I was forced to defend it. The sub's claim was denied at summary judgment (which in Virginia, where I was at the time, indicates that it was extremely weak to begin with). I was vindicated. I celebrated with my attorney over drinks that justice and fairness had prevailed. Then I got a bill for legal fees that were more than the amount of the original contract dispute. My victory was suddenly much less sweet.

Here in North Carolina, contractors and subcontractors can now better protect themselves by including an attorney's fees provision in their contracts. Not only does such a provision give you peace of mind that if you prevail in a suit to enforce your rights you can be reimbursed your costs for doing so, but it also reduces the chances that a suit may be brought against you for an improper purpose. If this provision is not in your contracts, it should be.

Attorney's fees provisions are not a magic bullet, however. The courts have discretion to award attorney's fees, meaning they are not mandatory. Also, the provision must be reciprocal, meaning that whichever party prevails may recover attorney's fees. A one-sided provision will not be enforceable. Additionally, the contract must be signed by hand (or electronically). This means that an attorney's fees provision inserted into the standard conditions of a P.O. or purchase contract will likely not be enforceable, unless it is signed by both parties. Still, an attorney's fees provision can be a powerful addition to your contracts.

Let's go back to my story. The worst part is not that the subcontract agreement did not include an attorney's fees clause. The worst part is that it was MY contract and I wrote it without one. If I had just had an attorney review my contract document I could likely have saved a ton of money simply by inserting an attorney's fees provision. Life's lessons are often expensive.

My contractor check up package was created so that I can use my experience as a contractor and an attorney to help contractors avoid costly mistakes like the one that I made in this case. Click here to learn about how my Contractor Check Up may be of help to your firm.