Under the American Rule, attorney fees are the burden of each party in a lawsuit unless they’re granted under a statute or an agreement to a prevailing party in litigation. For this reason fee-shifting provisions are ubiquitous in contracts and settlement agreements to frivolous drawn out litigation by a party that is clearly in the wrong. Recently, the 4th District Appellate Court of Illinois strictly construed a fee-shifting provision in a real estate purchase agreement and upheld the trial court’s denial of attorney fees to a prevailing party despite the agreement containing the provision.
In Cantrall v. Bergner, a roof defect was discovered during a home inspection prior to closing. The parties inserted an addendum in the real estate purchase agreement that the sellers, if competent to do so themselves, or by qualified contractor, would repair the defective roof. The sellers elected to repair the roof themselves. Within two weeks of the purchaser moving into the house, it rained and the roof leaked. The purchaser then brought suit against the sellers for breach of contract and requested fees under the fee-shifting provision which provided that “[a]ll costs, expenses[,] and reasonable attorney’s fees incurred by one party in enforcing said party’s rights under this [c]ontract may be recovered from the other party.” The purchaser prevailed on their breach of contract claim but the trial court elected to decline awarding attorney’s fees under the provision.
The 4th District Appellate Court affirmed. When analyzing the provision, the Court strictly construed its plain language. In this instance, since the provision stated that the Court “may” award attorney’s fees to the prevailing party, the trial court had discretion on whether it would award the fees.
Cantrall v. Bergner, 2016 IL App (4th) 150984 (4th Dist. 2016).
Alex Passo and Patterson Law Firm, LLC handle commercial litigation throughout Illinois and Indiana. Alex can be reached at (312) 750-1820 or email@example.com.