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Awarding Attorney’s Fees in Civil Litigation

As a civil litigator, one of the questions I’m most frequently asked is, “If I win my lawsuit, will the other side have to pay my attorney’s fees?” Other times people will just assume they’ll receive their attorney’s fees if they win a lawsuit. My answer is usually “No. It's unlikely you'll be awarded your attorney’s fees” or I’m left trying to correct someone’s misconception about the legal system.

In England, from where the United States inherited many of its laws and legal customs, the tradition has been that a losing party must pay the winning party’s attorney’s fees. To meritorious litigants, this seems fair and reasonable. If, for example, someone is owed $10,000 and they must pay $2,000 to obtain what they are owed, they only net $8,000 and they don’t feel they’ve been “made whole.” Conversely, many lawsuits involve uncertainty and it may seem unfair that a party that raises a meritorious defense to a claim, but ultimately loses, is essentially punished for attempting to enforce their rights. For this reason, among others, American legal scholars and American Courts view the English system as flawed. And therefore, American Courts have adopted what is known as the “American Rule.” The American Rule states each party is responsible for their attorney’s fees unless there is specific statutory or contractual authority to award attorney’s fees or a party makes a frivolous argument.

On September 28, 2016, the Idaho Supreme Court issues its decision in the Hoffer v. Shappard case (found  here). The Court held that, under Idaho statute, Courts have broad discretion in awarding attorney’s fees “when justice so requires.” The Court held that the rule will go into effect on March 1, 2017.

This holding and opinion has made waves in the Idaho legal community and in the legal community across the United States. Critics of the opinion state it is a step away from the American Rule and towards the English Rule. However, it appears the Court in the Hoffer case did not adopt the rule because it thought it was necessarily a good idea, but did so because it felt it was compelled to do so under Idaho statute.

The Idaho Legislature will have the opportunity between now and March 1, 2017 to make changes to the law. But in the absence of any changes, Idaho is poised to be the only state in The Union to have possible liberal attorney’s fee awards to prevailing parties.

If you are wondering if you are entitled to attorney’s fees in a particular case or if you someone has threatened to sue you and stated you’ll have to pay their attorney’s fees, we encourage you to give us a call at 701-478-7620.