Will a Kansas court make the losing side pay our fees under the contract's fee clause?
Only where a statute or the parties' agreement authorises it. In Snider v. American Family Mutual Insurance Co., a dispute about appellate attorney fees, the Supreme Court stated the general rule: "a Kansas court may not award attorney fees unless a statute authorizes the award or there is an agreement between the parties allowing attorney fees." Monarch Build v. DLH Holdings states the same rule the other way round, that "in the absence of statutory or contractual authorization, each party to the litigation is responsible for paying his or her own attorney fees", and reversed a $151,678.38 fee award because the clause relied on empowered "the arbitrator or arbitrators" and "does not give the same authority to the district court". One statute makes the award mandatory rather than discretionary in a narrow field: in any action to enforce K.S.A. 16-1803, 16-1804 or 16-1805 (the payment, retainage and suspension provisions of the Kansas fairness in private construction contract act) including an arbitration, the court or arbitrator shall award costs and reasonable attorney fees to the prevailing party, and venue is in the county where the real property is located (K.S.A. 16-1806).
The trap
The contractual route and the statutory route behave differently. A fee clause supplies the authority a Kansas court otherwise lacks, so its wording decides who recovers and on what condition. Monarch Build is the warning: a design-build agreement said the "arbitrator or arbitrators shall also be empowered to award reasonable attorney fees, costs and expenses, including expert fees, to the prevailing party", the claimant sued in district court instead of arbitrating, and the Court of Appeals found "nothing in the agreement to authorize a district court to award attorney fees in this case" and reversed the award. A fee clause written into the arbitration article buys nothing in court. K.S.A. 16-1806 supplies its own authority, requires the award to the prevailing party, and reaches arbitration as well as litigation, but only in an action to enforce the three sections it names: the syllabus the Monarch Build court wrote for its own opinion states that § 16-1806 "requires that the party seeking attorney fees show that the action was brought specifically to enforce the provisions of K.S.A. 16-1803, 16-1804, or 16-1805", and denied fees because the claimant "sought to recover damages for breach of contract, unjust enrichment, conversion, and under a lien replacement bond" instead, and the private construction act itself does not apply to single family residential housing, to multifamily residential housing of four units or less, to public works projects, or to contracts entered into before the act's effective date (K.S.A. 16-1807).
7 authorities
- case298 P.3d 1120Snider v. American Family Mutual Insurance Co.Kan.decided 2013read it at the source ↗
The words that state the rule
Foremost is the rule that a Kansas court may not award attorney fees unless a statute authorizes the award or there is an agreement between the parties allowing attorney fees.
- statuteK.S.A. 16-1806enactment date not established
The words that state the rule
In any action to enforce K.S.A. 16-1803, 16-1804 or 16-1805, and amendments thereto, including arbitration, the court or arbitrator shall award costs and reasonable attorney fees to the prevailing party. Venue of such an action shall be in the county where the real property is located.
- statuteK.S.A. 16-1807enactment date not established
The words that state the rule
The provisions of this act shall not apply to single family residential housing and multifamily residential housing of four units or less. The provisions of this act shall not apply to public works projects. The provisions of this act shall not apply to contracts entered into prior to the effective date of this act.
The words that state the rule
In Kansas, "in the absence of statutory or contractual authorization, each party to the litigation is responsible for paying his or her own attorney fees." Robinson v. City of Wichita Employees' Retirement Bd. of Trustees, 291 Kan. 266, 279, 241 P.3d 15 (2010).
The words that state the rule
In reaching its decision to award attorney fees, the district court relied on § 14.4.2 of the A141 design-build agreement, which states: "The award rendered by the arbitrator or arbitrators shall be final, and judgment may be entered upon it in accordance with applicable law in any court having jurisdiction. The arbitrator or arbitrators shall also be empowered to award reasonable attorney fees, costs and expenses, including expert fees, to the prevailing party." (Emphases added.) However, we cannot disregard the plain language of this section of the agreement that authorizes an award of attorney fees by arbitrators but does not give the same authority to the district court. If Monarch Build had chosen to pursue arbitration to resolve their dispute with the appellants, the "arbitrator or arbitrators" would have been "empowered to award reasonable attorney fees . . . to the prevailing party." But Monarch Build instead chose to file a petition in district court rather than submit the parties' dispute to arbitration. We find nothing in the agreement to authorize a district court to award attorney fees in this case. Although counsel for Monarch Build suggested in oral argument that the district court was also authorized to award attorney fees pursuant to statute, the district court expressly relied upon the "contract" as the basis for its award. Thus, we find that the district court's award of attorney fees should be reversed.
The words that state the rule
To recover attorney fees under the Kansas Fairness in Private Construction Contract Act, K.S.A. 16-1801 et seq., K.S.A. 16-1806 requires that the party seeking attorney fees show that the action was brought specifically to enforce the provisions of K.S.A. 16-1803, 16-1804, or 16-1805.
The words that state the rule
Based on the plain and unambiguous language of the Kansas Fairness in Private Construction Contract Act, we find that K.S.A. 16-1806 does not apply in this case because Monarch Build sought to recover damages for breach of contract, unjust enrichment, conversion, and under a lien replacement bond. Monarch Build did not bring an action under K.S.A. 16-1803, 16-1804, or 16-1805.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.