While “attorneys' fees are not usually an element of compensation for damages,” the theory of independent tort liability states that the plaintiff can recover attorneys' fees when the natural and immediate consequence of a criminal act by the defendant was the plaintiff's participation in litigation with a third party. Please check the link and try again, return to the previous page or visit our home page for suggestions. On the contrary, other courts have determined that the U.S. rule does not apply in cases where attorneys' fees do not fall on the winning litigant in the case in question, but are the subject of the lawsuit itself.
Ferrer, civil procedure, attorneys' fees, breach of agreement, damages and Harms vs. In other words, preventing Bolton from recovering his direct damages for McKinney's failure to comply with an express clause in the parties' contract simply because they also happened to be attorneys' fees would have deprived Bolton of the benefit of his negotiation and would have made his victories in McKinney's three lawsuits against him empty. The well-known U.S. rule holds that the winning party generally cannot recover its attorney's fees from the losing party if there is no legal or contractual provision specifically authorizing the award of such fees.
Therefore, the Supreme Court held that the trial court had erred in not granting Bolton compensation for the amount of attorney fees he incurred in defending the lawsuits unfairly brought against him by McKinney. The trial court decided that, although McKinney had breached the agreement not to sue, there was no reason to seek compensation for damages because, under the U.S. standard followed in Virginia, attorneys' fees are generally only awarded when explicitly authorized by a contract or law. Therefore, the award of an attorney's fees is required to place the offending party in the position they would have been in if the default had not occurred, which is the sole purpose of compensation for contractual damages. In jurisdictions that have not allowed lawyers' fees to be paid for damages, courts have argued that the contract setting out a commitment not to file a lawsuit can by itself cover attorneys' fees in the event of a default, if that is the intention of the parties.
The court considered more persuasive the reasoning of the courts that allow attorneys' fees to be awarded as compensation for the violation of an agreement not to sue because, unlike in most cases, attorneys' fees in that case are not costs but rather direct or subsequent damages resulting from the breach of this type of agreement. Even so, not all jurisdictions follow this rule, so it is good practice to include in settlement agreements that contain a no-demand agreement a clause providing for the award of attorneys' fees in the event of non-compliance with the pact. Jurisdictions are divided on the question of whether a party can recover its attorney's fees as damages, rather than as costs, for the breach of an agreement not to sue the other party.
