In Michigan, attorney fees are generally not recoverable as either costs or damages unless they are expressly authorized by contract, statute, court rule, or a recognized exception. Express authorization means the provision must be worded clearly and precisely and not contain any vagueness or ambiguity. When requesting attorney fees in court, you will need to state the basis of your request (i.e. whether you are authorized to recover attorney fees through contract, a court rule, a statute).
One way to ensure that you have express authorization to request attorney fees in court is to draft a provision into your contract that allows you to recover attorney fees in the event of litigation. When constructing an attorney-fee provision, make sure to state whether attorney fees will be mandatory or discretionary, who will pay the attorney fees, and whether the award will cover reasonable attorney fees or the actual attorney fees incurred by the prevailing party. Keep in mind that an attorney-fee provision for a fixed sum will be invalid because it is considered contrary to public policy. Reasonable attorney fees may include costs for services rendered on appeal, as well as at trial.
In contract disputes, attorney fees are considered damages, not costs. Therefore, the proper procedure is to include the attorney fee provision in the pleadings with your request for damages, not to present the claim for attorney fees to the trial court as taxable costs. Sometimes the terms of a contract will provide that the non-breaching party be entitled to attorney fees in the case of breach. In those cases, it is not necessary to include a provision in your pleadings because the contract has already resolved the issue.
This article was written by Laura Barrera, law clerk. For more information contact the attorneys at Demorest Law Firm.
