If you’re thinking about filing a lawsuit in Texas, one of the biggest considerations is the cost of legal representation. Attorneys’ fees can be a significant expense, and understanding whether or not you can recover those fees is important.
In the United States, the default rule regarding attorneys’ fees is known as the “American Rule.” This rule stipulates that each party in a lawsuit is responsible for paying their own attorneys’ fees, regardless of the outcome of the case. Essentially, this means that even if you receive a favorable outcome in court, you still pay for your own attorneys’ fees. However, there are some exceptions to this rule in Texas.
Despite the American Rule, in Texas, there are several circumstances allows for the recovery of attorneys’ fees.
Texas law provides specific statutes that allow for the recovery of attorneys’ fees in certain types of legal claims. Some of the most common statues include:
a. Texas Civil Practice and Remedies Code § 38.001: If your lawsuit involves a breach of contract, you may be able to recover attorneys’ fees under this statute. To be eligible, the claimant must prevail on a claim for services rendered, labor performed, materials furnished, or an oral or written contract. Importantly, in order to qualify for this recovery, the claimant must have presented their claim to the opposing party, and the opposing party must fail to tender the amount owed within 30 days after the claim is presented.
b. Texas Deceptive Trade Practices Act (DTPA): Under the DTPA, a consumer who successfully brings a claim against a business for deceptive practices may recover attorneys’ fees, in addition to other damages.
c. Texas Property Code: Certain provisions under the Texas Property Code allow for the recovery of attorneys’ fees in disputes involving landlord-tenant issues, property liens, and other real estate matters.
d. Texas Family Code: In family law cases, such as divorce and child custody, the court may award attorneys’ fees as part of the final judgment, particularly when the fees are necessary for the protection of a party’s rights.
Some of the statues described above allow parties to agree to waive recovery of attorneys’ fees under the statute. However, there are typically very specific requirements the parties have to follow in waiving these provisions. It is important to ensure that these requirements are met if you intend to waive recovery under these statutes. If the requirements to waive recovery are not met, generally, the waiver is not effective.
Parties to a contract can include a provision that allows the prevailing party to recover attorneys’ fees in the event of a dispute. These clauses are generally enforceable in Texas and can be a powerful tool in protecting your financial interests if a contract goes awry. However, it is essential to ensure that the contract’s language is clear and enforceable. Vague or poorly drafted fee recovery clauses might not hold up in court, leaving you to bear your own legal costs. In general, these provisions should be mutual, meaning that either party can recover fees if they prevail. Unilateral fee provisions may be scrutinized or deemed unenforceable by courts.
In rare cases, Texas courts may award attorneys’ fees based on equitable principles, even in the absence of a statute or contractual agreement. These situations usually involve situations where one party has acted in bad faith, engaged in fraudulent behavior, or otherwise abused the judicial process. Even so, it is never guaranteed that you will recover attorneys’ fees when one party has acted unjustly or in bad faith. Recovery of attorneys’ fees in these situations varies depending on the court, the judge, and the circumstances. More often than not, attorneys’ fees in these situations are not awarded.
Despite the various exceptions, there are many situations where attorneys’ fees are not recoverable in Texas. For example:
Generally, attorneys’ fees are not recoverable in tort actions, such as personal injury claims, unless specifically provided by statute.
Attorneys’ fees are typically not recoverable as part of punitive damages except in certain statutory claims, like those under the DTPA.
Routine costs associated with litigation, such as court filing fees or depositions expenses, are generally not recoverable as attorneys’ fees unless explicitly stated in a statute or contract as discussed above.
Given the complexities and uncertainties surrounding attorneys’ fees, one of the most important things to consider before filing a lawsuit is the financial impact attorneys’ fees will have on you and your case. Attorneys’ fees can add up quickly, especially if the issues being litigated are complex and the other party is unwilling to cooperate. If the amount you stand to gain is relatively small compared to the cost of legal fees, it may not be worth pursuing the case. You must conduct your own cost/benefit analysis on whether pursuing legal action is worth what you may spend in attorneys’ fees alone.
In Texas, if you win a legal case, you might be able to get the other party to pay for your attorney’s fees. This is called the "recovery of attorney’s fees" and is covered under Texas Civil Practice and Remedies Code Section 38.001.
According to Texas Civil Practice and Remedies Code Section 38.001, attorney’s fees can be recovered from an individual or organization, with exceptions. You can recover these fees in addition to the actual amount you are claiming for if your claim is related to:
However, there are exceptions. You cannot recover attorney’s fees from:
If you’re dealing with a construction contract, you can recover attorney's fees as part of the damages for breach of contract, but this law doesn't create a new reason to sue someone (Texas Civil Practice and Remedies Code Section 38.0015).
Section 38.0015 is crucial for contractors, builders, or property owners engaged in construction-related litigation. However, this law doesn’t create a new right to sue someone just for recovering attorney’s fees—it can only be used if there’s an existing breach of contract.
In Texas, the law presumes that the usual and customary attorney's fees are reasonable for claims under Section 38.001. The law assumes that the standard or “usual” attorney’s fees for these types of claims are reasonable. This is helpful because you won’t need to prove the fees are reasonable unless the other side challenges the amount, which they are allowed to do.
This presumption can be rebutted in court, meaning the opposing party can argue that the fees are excessive. Texas Civil Practice and Remedies Code Section 38.003
A Texas court has the authority to take judicial notice of customary attorney’s fees. This means that the judge can use their knowledge of what typical legal fees are without needing additional evidence. This can happen either:
There are certain contracts where this law does not apply, particularly in cases involving insurance contracts. These exceptions include contracts that fall under:
If your case involves one of these types of insurance contracts, you will not be able to recover attorney’s fees under this section of the law.
Certain insurance contracts are excluded from attorney fee recovery under Texas Civil Practice and Remedies Code 38.006, specifically those subject to Title 11, Chapter 541, and Chapter 542 of the Texas Insurance Code.
In Texas, once a claim is presented, the opposing party has 30 days to make payment. If they fail to pay within that time frame, you can take legal steps to recover both the claim amount and attorney's fees.
Court costs in Texas refer to the fees and expenses associated with filing and pursuing a legal case. These costs cover a range of administrative and procedural fees required by the court system.
Common Court Costs in Texas:
Typically, the losing party is required to pay court costs, but Texas courts may split costs based on the specific circumstances of the case. In some instances, costs can be negotiated or ordered differently by the judge.
It's important to note that court costs are separate from attorney's fees. Attorney's fees are what you pay your lawyer, while court costs are administrative charges by the court.
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