Contracts & ExecutionQuestion 885 of 1605
An 'attorney fees' clause in a contract typically provides that:
a.Attorneys are prohibited from the project
b.Only the owner can ever recover fees
c.The prevailing party in a dispute may recover its reasonable attorney fees from the losing party
d.The contractor waives all payment rights
Explanation
Under the American rule, each party normally bears its own attorney fees unless a contract or statute provides otherwise. An attorney fees clause shifts that risk by allowing the prevailing party in a dispute to recover reasonable attorney fees from the losing party, and in California such clauses are generally applied reciprocally regardless of which party is named. It does not ban attorneys, favor only the owner, or waive the contractor's payment rights.
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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)