Can You Recover Attorney’s Fees In An Ohio Breach Of Contract Lawsuit?

When a company or person is compelled to take legal action against another person due to breach of contract, a basic question to ask is whether, in case of a successful outcome, the defendant will be required to compensate the other party for their legal fees.

In Ohio, this is not normally the case. This is because Ohio adheres to the American Rule, whereby each side normally pays its own lawyers. There are notable exceptions to this rule and understanding them can prove particularly crucial in assessing the pros and cons of a breach of contract claim.

What is the American rule? 

Under the American rule, if the suing party wins a breach of contract case, that party usually cannot recover their attorney fees.

Similarly, the defendant is not necessarily entitled to recover money for their defense, even if they win.

Even if the defendant caused the dispute, they are not responsible for all the expenses incurred during the trial.

In Ohio, there are some exceptions to this rule.

A contract can require attorney fees in case of a dispute 

Fees can be provided for under commercial agreements, leases, loan agreements, and other contracts. The fee-shifting provision could require one party to pay the other’s attorney fees to enforce the contract.

The wording will make a huge difference, since some provisions can apply only to specific types of claims or breaches.

Courts can also contest whether the provisions are enforceable and to what extent. This means the court must consider the entire agreement rather than making assumptions based on wording about attorney fees.

Attorney fees may be available in other circumstances 

Other avenues also exist for recovering attorney fees. Ohio provides for an award of attorney fees in specific situations.

A court might award attorney fees when the litigation conduct is more than just a simple breach of contract. In Ohio, fees can be awarded when one party conducts itself in bad faith, is vexatious, wanton, oppressive, or obstinate.

It should be noted that these exceptions cannot be equated to merely proving that the other party violated a contractual agreement. A dispute regarding the violation of a contract does not mean that misconduct that will warrant the recovery of attorney’s fees has occurred.

Attorney fees can affect litigation strategy 

The opportunity to recover attorney fees can alter your litigation strategy. For example, if a corporation is entitled to $30,000 under a contract but is anticipating considerable costs to obtain it, this can impact how you go about resolving the issue.

The same issues are relevant to the defendant. A corporation involved in a contract dispute needs to evaluate whether any contract provisions would hold it liable for the other side’s legal costs.

Talk to a Dayton, OH Business Litigation Attorney Today 

Kohl & Cook Law Firm, LLC represents the interests of Ohio businesses in contract disputes. Call our Dayton business litigation lawyers today to schedule an appointment, and we can begin resolving your issues right away.