Can I Recover My Attorney's Fees?
Maybe. In California and most other states, the general rule is that a successful litigant cannot recover attorney's fees. There are, however, some exceptions to this.
Under California Code of Civil Procedure section 1021, attorney's fees are ordinarily paid by the side that incurred the fees unless there is a statute or contract to the contrary. In our practice, there are several areas in which a party may have a right to recover attorney's fees after a trial.
A. Trusts and Estates
In the context of trusts and estates, there are several possible avenues that a successful litigant may be able to recover attorney's fees if successful in litigation. The reasons for this are court doctrines such as the "common fund theory", the "substantial benefit rule" or the "private attorney general theory". What these doctrines really boil down to is that either one person, or a small number of people, pursue litigation which results in a benefit or fund being established for multiple other people.
An example of this would be if a beneficiary pursues litigation against a trustee, but the beneficiary's interest is only 1%. If the beneficiary obtains a judgment against the trustee and the trust receives a benefit, the argument is that the beneficiary should have his attorney's fees paid out of the benefit received, rather than his or her own share. As you may guess, if there are multiple beneficiaries pursuing the same goal and achieve the same result, however, the court may ultimately require that each bears his or her own cost, or limit the recovery of attorney's fees from the fund.
If a person is acting as a trustee, and successfully defends his or her actions, the courts routinely award the trustee their attorney's fees because the trustee is considered to have brought a benefit to the trust and its beneficiaries by virtue of confirming the proper management of the trust. While there are also other theories behind this, it ultimately rests on the fact that the trustee did not force litigation and disallowing a trustee to pay his or her attorney to defend himself would be contrary to public policy and would deter others from serving in the role.
It should be noted that if you are a trustee, it might make sense to have separate administration counsel and separate litigation counsel due to concerns over attorney-client privilege. For more information, you should read Does a Trustee Have Attorney-Client Privilege?.
Lastly, in the context of trust litigation, the court also has an option to shift attorney's fees to be payable by a beneficiary directly, or by a trustee directly, if the court finds that a approval of an accounting was either pursued or opposed without reasonable cause and in bad faith. This is a very difficult hurdle to overcome, but can be a reason for matters to settle prior to going through trial.
We regularly represent beneficiaries and trustees in litigated matters, and depending on the circumstances, we may not require immediate payment at the time of retention.
B. Divorce and Custody Matters
In divorce and custody matters, attorney's fees may be recoverable from the opposing party pursuant to Family Code Sections 2030 through 2034. There could be multiple bases that are applicable to seek attorney's fees from the other side, such as misconduct, the nature of the litigation, the nature and extent of the proceeding, the size and type of community assets involved, the financial circumstances of both parties, the skill required of counsel, and any experience or special expertise needed of the counsel.
We regularly represent clients in divorce and custody disputes, and depending on the circumstances, we may not require immediate payment at the time of retention.
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