Can the winner recover attorney fees on this Utah contract claim, and does a one-way fee clause bind only one side?
In Utah attorney fees are awardable only if authorized by statute or by contract (Wittingham v. TNE, 2024 UT 23, quoting Dixie State Bank v. Bracken). The reciprocal fee statute makes a one-way clause run both ways: a court may award costs and attorney fees to either party that prevails in a civil action based upon any promissory note, written contract or other writing executed after April 28, 1986, when its provisions allow at least one party to recover attorney fees (§ 78B-5-826). But the award is allowed only in accordance with the terms of the contract, and the provision must be broad enough in scope to cover fees incurred in the action in question.
The trap
Reciprocity does not enlarge the clause: in Wittingham the prevailing plaintiffs claimed fees through a trust-deed provision obliging the borrower to pay the lender's fees in defending actions affecting the security, and the question was whether that provision would have given the lender fees in a suit like the one brought; § 78B-5-826 helps only when the other side could have recovered under the clause in THIS action. The statute is discretionary ('may award'), and it reaches only writings executed after April 28, 1986.
6 authorities
The words that state the rule
In Utah, attorney fees are awardable only if authorized by statute or by contract.” Dixie State Bank v. Bracken, 764 P.2d 985, 988 (Utah 1988).
- statuteUtah Code § 78B-5-826enactment date not established
The words that state the rule
A court may award costs and attorney fees to either party that prevails in a civil action based upon any promissory note, written contract, or other writing executed after April 28, 1986, when the provisions of the promissory note, written contract, or other writing allow at least one party to recover attorney fees.
The words that state the rule
the award of attorney fees is allowed only in accordance with the terms of the contract,” R.T. Nielson Co. v. Cook, 2002 UT 11, ¶ 17, 40 P.3d 1119, and the contract provision must be “broad enough in scope to cover fees incurred in this . . . action
The words that state the rule
Invoking Utah’s reciprocal fees statute, see UTAH CODE § 78B-5-826, plaintiffs argued that because TNE would have been able to recover fees under paragraph 4 had it prevailed in the litigation, plaintiffs (as the prevailing parties) were entitled to recover their fees from TNE.
The words that state the rule
Plaintiffs assert here, as they did below, that paragraph 4 of the TNE trust deed allows for an attorney fees award to the prevailing party. That paragraph provides that, to protect the security of the TNE trust deed, the Muir Partnership agrees [t]o appear in and defend any action or proceeding purporting to affect the [apartments], the title to said [apartments], or the rights or powers of [TNE]; and should [TNE] elect to also appear in or defend any such action or proceeding, to pay all costs and expenses, including . . . attorney’s fees in a reasonable sum incurred by [TNE].
The words that state the rule
This action was not one where the Muir Partnership and TNE both “appear[ed] in and defend[ed]” the security of the TNE trust deed. Indeed, we agree with the district court that the Partnership could not appear in and defend against its own lawsuit seeking to declare the trust deed invalid. Because “any such action” is not “broad enough in scope to cover fees incurred in this . . . action,” see Loosle, 858 P.2d at 1003, paragraph 4 is not a legal hook for a fees award under the reciprocal fees statute. Thus, the district court did not err in denying plaintiffs’ request for an attorney fees award.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.