Most people think the term “attorney’s fee clause” or provision just applies to attorneys. Nothing could be further from the truth. The correct way to think about the attorney’s fee clause or provision is in the context of any contract you might have written for yourself or your business.
Any legal dispute you have with someone or a business means there’s going to be attorneys involved. In situations where there are attorneys, you’re going to see attorneys’ fees. Whenever you’re having a contract prepared, you need to address the possibility that a legal dispute is going to arise at some point between the contracting parties. As a result, you need to make sure there’s a clause or provision in the contract that addresses who is going to pay for the attorneys’ fees.
It’s common to have a provision that requires the losing party in a dispute pay the attorneys’ fees and costs. These provisions are commonly written as follows: “The prevailing party shall have the right to collect from the other party its reasonable costs and necessary disbursements and attorneys’ fees incurred in enforcing this Agreement.” The most common costs include filing fees. Filing fees may consist of fees for serving summons, complaints or other court papers. The costs might include transcription services by a court reporter or photocopying of court papers and exhibits. It’s important to note that court costs are typically paid by all parties to a dispute but if you include an attorney’s fees provision in your contract, this can make the losing party to the dispute also responsible for the court and other costs.
One thing you have to be careful about with these provisions is that in a relationship where one party to the contract is in a stronger position, they will often put in a provision that means one party to the contract pays all fees and costs and that party is usually the party that is the weaker in the agreement. Even as this is unfair, it’s not unheard of so it’s important to watch out for this.
Preparing contracts is no simple matter and it’s important to have them prepared by experts who can look out for your best legal interests. At Bovarnick & Associates, LLC., we specialize in preparing contracts for our clients. If you’re in need of a contract, whether it’s for your business, property or personal matter, we can take care of it for you. Just give us a call at 215.568.4480 or email us at firstname.lastname@example.org.
Robert M. Bovarnick, Esquire