Subscribe to RSS FeedBy my count, there's already about sixty reported decisions in 2010 referencing the admiralty law. That’s a pretty decent haul considering the new year hasn't even motored past the breakwater. It's been a couple of moons since we've visited a maritime law issue, so let's cast off that spring line . . . .
The Eleventh Circuit Court of Appeals recently addressed the recovery of attorneys’ fees in an admiralty litigation. Now the reason this decision caught my eye was because there's always a great amount of enthusiasm about recovering attorneys’ fees. However, the default position in the United States is called the “American Rule” and requires each party to assume its own fees. England has, I understand, a different system whereby fees are the responsibility of the losing party. There are good arguments to be made that having each party pay its own attorneys’ fees allows equal access to the judicial system.
In this decision, the underlying dispute was between a general contractor and a sub-contractor on a dredging project. When the defendant sub-contractor prevailed, it turned around and sought its attorneys’ fees pursuant to a state statute. The state statute allowed a prevailing party to recover fees.
The appellate court began its analysis by finding that substantive maritime law controlled its ruling. Next, the court explained that the law in its circuit regarding attorneys’ fees and maritime disputes is “clear” and that the prevailing party is not entitled to recover its attorneys’ fees as a matter of course. The appellate court noted that a prevailing party in a maritime case is entitled to its attorneys’ fees where (1) a statute governing the claim allows for their recovery, (2) the non-prevailing party acted in bad faith in the course of the litigation, or (3) there is a contract providing for the indemnification of attorneys’ fees. Finding that none of the exceptions applied, the court turned to the applicability of the state statute. In what I think is an important decision that was needed, the court made clear that the “American Rule” regarding attorneys’ fees was a characteristic feature of substantive maritime law, and as such, the state statute was in direct conflict. That is, the state statute had to give way to the maritime law and the subcontractor couldn't recover its attorneys' fees.
So there you go, a little foray into the choppy waters of the law. I feel better having gotten that out of my system. There's a comment to my last entry on Loran-C deserving a response; it's coming.
Underway and making way.
--- JKF
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