The wrongful act doctrine: a common law exception to the American rule on entitlement to attorneys' fees in Florida.

• Author: Colvin, Jeremy M.

As much as attorneys and judges enjoy citing and applying bright-line rules of law, they relish the opportunity to carve out exceptions to them even more. In Florida, the prevailing party in a civil action is not entitled to an award of attorneys' fees unless the claim is predicated upon a contract or statute that authorizes the recovery of such attorneys' fees. This rule of law is often described by attorneys and judges as "well-settled," "axiomatic," or "hornbook law." (1)

While this is undoubtedly an accurate recitation of Florida law, and it is certainly true that Florida follows the "American Rule" on entitlement to attorneys' fees, civil litigators should also be cognizant of a potent exception to this rule: the wrongful act doctrine. (2) The wrongful act doctrine is a judicially created equitable principle that permits the recovery of attorneys' fees when a defendant's acts or omissions cause another party to incur attorneys' fees in maintaining or defending a lawsuit with a third party. (3) Stated differently, the doctrine permits "a plaintiff to recover third-party litigation expenses as special damages where the defendant's wrongful act caused the plaintiff to litigate with the third party." (4)

The name of this doctrine seems to add to its mystique and obscurity because it sounds, quite frankly, like fictional law. There is also a dearth of caselaw on the subject, particularly because the courts do not always refer to the doctrine by name. The 11th Circuit Court of Appeals recently examined the wrongful act doctrine and noted that the litigants failed to cite a single case from the Florida Supreme Court describing the doctrine. The 11th Circuit also commented that it had only mentioned the doctrine in one prior unpublished opinion in which the claim was eventually abandoned. (5) These unimpressive facts led the 11th Circuit to "question how well-established the doctrine is in Florida." (6)

Despite its unfortunate name and limited caselaw on the subject, the wrongful act doctrine is a genuine, long-recognized exception to the rule on entitlement to attorneys' fees in Florida. With the ever-increasing costs of litigation, the legal community is well-aware that the specter of paying the opponent's attorneys' fees can drastically change the dynamics of a case. The ability to recoup attorneys' fees from the adverse party sometimes enables clients with limited or no financial means to obtain legal representation. The existence of such claims also has the tendency to encourage parties to resolve their disputes amicably without going through the expensive, time-consuming, uncertain experience of trial. Therefore, the wrongful act doctrine can be a helpful tool for Florida litigators and their clients.

Origins and Definitions of the Doctrine

The wrongful act doctrine springs from the equitable principle that the tortfeasor or breaching party should be held liable for all of the damages naturally flowing from the misconduct or breach. Although lacking a catchy name, the principles of law supporting the wrongful act doctrine have long been a part of American jurisprudence, and, in fact, it was likely a legal doctrine inherited from England.

As early as 1874, the Illinois Supreme Court stated that a party may recover the damages naturally flowing from the wrongful acts of the defendants, including attorneys' fees and expenses incurred in litigation with third parties:

The rule, as found in the text-books, is, that whosoever does an illegal or wrongful act is answerable for all the consequences in the ordinary and natural course of events, though these consequences be directly brought about by the intervening agency of others, provided the intervening agents were set in motion by the primary wrongdoer; or, provided their acts, causing the damage, were the necessary or legal and natural consequence of the original wrongful act....

A case is referred to from 30 Law Journal, Queen's Bench, 137, Dixon v. Fourcoy, where it was held, if the natural result of a wrongful act, committed by a defendant, has been to plunge the plaintiff into a chancery suit, and thereby to cause him to incur costs and expenses, whatever may be the event of the suit, there is that conjunction of wrong and damage which will give the plaintiff good cause of action. (7)

In 1909, the Appellate Court of Appeals in Maryland, the highest court in that state, made a similar pronouncement of the wrongful act doctrine as an exception to the American Rule regarding the recovery of attorneys' fees:

[W]here the wrongful acts of the defendant have involved the plaintiff in litigation with others, or placed him in such relations with others as make it necessary to incur expense to protect his interest, such costs and expense should be treated as the legal consequences of the original wrongful act. (8)

In 1954, the Iowa Supreme Court had an opportunity to discuss the wrongful act doctrine, which by that time was considered a "well-established exception" to the American Rule regarding the recovery of attorneys' fees by the victorious litigant:

If A sues B, generally, as noted above, the successful party cannot recover his expenses of litigation such as lost time, attorney fees, and other special items other than court costs. But if through the tort of A, B is in good faith involved in litigation with C, the exception comes into play, and B may then recover the reasonable value of his expense for employment of counsel, and other proper items, from A. (9)

The underpinning for the wrongful act doctrine seems to be the desire to hold the wrongdoer responsible for the full consequences of the wrongful conduct, including reimbursement of attorneys' fees expended in the litigation. Whether the cause of action sounds in contract or tort, the goal of civil litigation is premised upon the basic notion of placing the aggrieved party into a position where that party would have been but for the tort or breach committed by the wrongful party. Indeed, the Florida Supreme Court noted that in "certain causes of action, attorney fees historically have been considered part of litigation costs and the award of these costs is intended not only to discourage meritless claims, but also to make the prevailing plaintiff or defendant whole." (10) The wrongful act doctrine is designed to fulfill this equitable objective.

The Wrongful...