Florida Business Litigation Lawyer Blog
The “American rule” holds that each party to a lawsuit will pay for his or her own attorney’s fees regardless of who prevails in the case. Unless a statute or contractual provision says otherwise, Florida courts will apply the American rule. For that reason, contracts oftentimes contain provisions stating that if litigation arises under the contract, the losing party must pay the prevailing party’s attorney’s fees.
Florida statutory law, however, requires reciprocity. In other words, if “a contract contains a provision allowing attorney’s fees to a party when he or she … enforce[s] the contract, the court may also allow reasonable attorney’s fees to the other party when that party prevails … with respect to the contract.” Fla. Stat. § 57.105(7). For example, the following contractual provision is not reciprocal: “Buyer shall pay for Seller’s attorney’s fees if Seller prevails in a claim against Buyer.” The terms of the contract grant only Seller, not Buyer, the right to attorney’s fees upon prevailing. However, because Florida law requires reciprocity, Florida courts generally will read that contractual provision as also granting Buyer a right to attorney’s fees upon prevailing in a suit to enforce the contract.
In Fla. Hurricane Prot. & Awning, Inc. v. Pastina, 43 So. 3d 893 (Fla. 4th DCA 2010), a homeowner entered into a contract with a contractor to install shutters. The contract included the following provision: “Purchaser [i.e., the homeowner,] is responsible for all costs of collection including Attorney’s fees.” Fla. Hurricane Prot. & Awning, Inc., 43 So. 3d at 894. The contractual provision is not reciprocal, i.e., it grants only the contractor the right to recover attorney’s fees from the homeowner. After the contractor failed to install the shutters, the homeowner sued for breach of contract and prevailed. Relying on Florida’s reciprocity statute, the homeowner sought attorney’s fees from the contractor. While the trial court agreed with the homeowner and awarded her attorney’s fees, the appellate court disagreed.