Tuesday, January 6, 2009

The Impact of Trytek on Construction Lien Attorney's Fees

In Florida, attorney’s fees may be awarded in only two circumstances. First, there is a statute that provides for attorney’s fees or second, it is based on a prior agreement between the parties (in a contract). The Florida Lien Law provides attorney’s fees for the prevailing party in an action to enforce a construction lien. Last month, in Trytek v. Gale Industries, the Florida Supreme Court ruled that in an action to enforce a construction lien, the court must apply the “significant issues” test to determine which party is entitled to reasonable attorney’s fees under the lien law, even when the lienor obtains a judgment on the lien. This means that the court should look to see which issues were before it and which party prevailed on those particular issues. In other words, which party achieved the benefit it sought in the suit. Just because a claimant receives a judgment does not mean that he is the prevailor in the suit. For example, in the above case, the issue was the amount of setoff the owners were entitled to on a lien filed by a contractor. Since the issue was the amount of the set off and the owners obtained almost the entire amount of the setoff they sought in suit, the court determined they were the prevailing party. The court went even further and stated that this was a flexible and equitable rule and that a court has the discretion to determine that neither party prevailed on the significant issues and that neither party is entitled to attorney’s fees. Thoughts???

2 comments:

Clark.Wilson.IP.Atty said...

So, does this mean that in lien law, both parties can "prevail"? One on the lien and the other on another issue? The court just has to determine what the main issue is? What if there are counterclaims? Are they evaluated separately? Very interesting ruling.

Salvador A. Jurado Jr, Esq. said...

This was a major decision! Probably one of the most important Construction Lien law decisions of 2008. The problem with this decision is that it makes it very hard to advise a client as to whether he will be entitled to recover attorney's fees. In Construction disputes, it is possible to have one party to prevail on the lien count and the other party to prevail on another count (i.e. Breach of Contract). However, in the past, if you prevailed on the lien count, you were entitled to recover your attorney's fees. After this decision, this is not always true.