There a number of truths in life from “the only certain things are death and taxes,” to “the sun rises in the East and sets in the West,” and, my personal favorite, “everyone hates being nickeled and dimed.” While I can’t address the metaphysics of death or why the Earth rotates clockwise, I can speak about the last one. Everyone hates the idea of being taken advantage of, particularly when the costs associated with dealing with a person cost more than a few nickels and dimes. This occurs in the law, just as it does everywhere else.
Here is the basic problem: Someone owes you money, say $5,000, which is not an insubstantial amount. If you hire a lawyer to collect it, the attorney’s fees will quickly eat up most, if not all, of the $5,000. I recently had a real-life example of this. A friend of mine is owed about $20,000 in past-due child support. Real money that she can certainly use. Her ex, ironically now married to a divorce lawyer, could pay it but simply refuses. My friend’s only option is to sue her ex to pay the past-due amount. However, since the ex has a “free” lawyer at his disposal, unless my friend hires an attorney, she will be at a disadvantage.
As you know, good lawyers can charge up to $400-$500 per hour. Let’s assume it take 8 hours from the time my friend has her first meeting with a lawyer until a motion is filed. At $500 an hour, that’s already $4,000. Let’s also assume from that moment, until the court hearing, the attorney logs 2 more hours. Another $1,000. Since court always takes time, let’s wager the time spent between gavels is another 6 hours, adding $3,000. We are now up to 16 hours and $8,000. What will my friend have for her money? Most likely, an Order stating she can get the $20,000 of child support. She will now need to spend even more money to actually get what’s owed to her.
See the point? Despite spending money out-of-pocket for a lawyer, my friend still has no assurance of actually getting back the money she deserves. Is there any hope? This is where an attorney’s fee provision comes in. If the underlying agreement with her ex states that, if she has to chase him, he will have to pay not only what he owes in child support, but all of the money she spent on litigation. Of course, she is still out money on the front-end, but now she can hope to recover her costs, assuming her ex pays both the $20,000 and the additional $8,000 in fees.
Having an attorney’s fee provision is one of two ways to recover lawyer fees. The other is if there is a statute permitting it. While one would think that, in the world of divorce court, there would be such a statute. However, it is not that simple. In Pennsylvania, there is such a statute, but it does not make payment of fees mandatory. Rather it provides that, “the court MAY assess… reasonable attorney fees… .” I have two issues with this. First, the word “may” which means that it is at the discretion of the court. Second is the word “reasonable.” While there is always a presumption that the award of fees must be reasonable, the word is open to interpretation. In my example, there may be no doubt my friend’s attorney put in 16 hours. However, the court may conclude that fees which are equal to 40% of the amount of the past-due child support is too much and reduce it to $4,000. My friend will still have to pay the $8,000, but is now out $4,000.
This is why a provision in your agreements providing for the award of attorney’s fees is just as much for your benefit as for your lawyer. By doing this, we may be able to add another phrase to life’s truths— “My lawyer is my friend.” Okay, that might be asking too much.