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Collecting Attorney Fees

10/1/2019

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_When a person comes to a lawyer, he or she usually has a story and two questions. The story is the set of facts that makes them believe they need legal help. The two questions are: 1) Do I have a case? and 2) Can I collect attorney fees?

Any client knows that attorney fees can be substantial. Sadly, the cost of bringing a lawsuit can prohibit people and companies from bringing legitimate cases. Conversely, people and companies all to often settle frivolous cases simply to avoid legal fees. Many people are frustrated with this situation and feel something should be done. These people believe it is unfair to have to pay legal fees to get something you are legally entitled to have or to defend something that has no merit. These people suggest a “loser pays” system where the legal fees of both sides are paid by the loser. While this idea may have merit, it is not the law in North Carolina.

In this State, in the majority of cases each party pays for its own legal fees. That should be a client’s reasonable expectation when heading into litigation. The exception to this rule is where a statute specifically allows a party to collect attorney fees. Even in those cases, the decision to award fees as well as the amount is in the discretion of the judge. In North Carolina there are a number of statutes which allow people to recover attorney fees. Some of the most common are listed below:

N.C.G.S. § 6-21.1  Attorney fees can be awarded in claim for personal injury or property damage less than $10,000.
N.C.G.S. § 6-21.2  Attorney fees in amount of up to 15% of principal are collectible on “evidence of indebtedness.” To enforce this, a notice must be sent.
N.C.G.S. § 6-21.6  Attorney fees can be awarded in a commercial contract if the provision is mutual.
N.C.G.S. § 44A-35  Prevailing party in lien or bond claim can collect attorney fees if other side unreasonably refused to settle matter.
N.C.G.S. § 75-16.1  Prevailing party can collect attorney fees in claim for unfair or deceptive trade practices.

In addition to these state claims, many federal statutes provide for attorney fees.

The stark reality is that when you choose to proceed with litigation you should not anticipate recovering your attorney fees.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.
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    Doug McClanahan

    _Doug has been an active member of the North Carolina Bar Association since 1995. He has been the Technology Chair of Construction Section and a member of the Litigation Section. Currently he volunteers in the Law Related Education Committee of the NC Bar Association. Doug volunteers with a number of other local and state programs including Lunch with a Lawyer, Mentoring, and Job Shadowing. He has been published in various trade and Bar Association publications and has spoken at continuing education functions for accountants, engineers, paralegals and attorneys.

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