As always, before reading this post, please review my disclaimer by clicking the link above or by clicking on this link. As always, any legal principles discussed apply only to the Commonwealth of Virginia.
Introduction
"It's their fault that I'm in this mess, they should pay your fees, not me." If I had a dime for every time I've heard a client say that or something similar to me I'd... well... probably have a lot of dimes. Attorneys' fees are one of those areas where a particular sense of unfairness hits a lot of clients. If it's not their fault that they need an attorney (maybe they've been wrongfully sued, or wrongfully accused of a crime, or maybe they are enforcing their rights against someone who refuses to do what they are supposed to), it just doesn't seem right that they have to pay their lawyer and can't get the other side to pay.
Well, there are some situations in which your attorneys' fees can, in fact, be ordered to be paid by the other party, but those situations are exceptions, not the rule, and even they are complicated. In this blog post I hope to discuss some of the basics (the details would be far too much for one post) on when you can and cannot require the other party to pay for your lawyer, and how such an arrangement actually works.
American Rule vs. English Rule
Much of the "common law" world (the parts of the world that can trace their legal traditions to Medieval England) follow what is known as the "English Rule" in civil lawsuits. This rule is simple - in a lawsuit, the loser pays the winner's attorney's fees, in addition to his or her own. The United States, however, despite being a common law country, does not follow the English Rule. Rather, we follow the "American Rule," which states that, while there are exceptions, barring the availability of one of those exceptions, each party pays his or her own attorney regardless of who wins and loses.
The merits of this Rule can be debated all you want (and this is not a constitutionally required rule, by the way, meaning the various state legislators could change it any time they wanted to if they wished), but it is the law in all 50 states and the federal court system right now. As a result, you should always enter a legal situation expecting to pay your own attorney.
Now, with that background, it might be worth discussing what the major exceptions are. In Virginia, there are around three major exceptions.
Exception 1 - Statutory Exceptions
Statutory exceptions are situations where Virginia Law expressly provides for attorneys' fees to be awarded in the discretion of the court. Some common situations in which courts have the power to award attorneys' fees to a party of its choosing are Family Law cases (including divorce), estate dispute cases, and all civil lawsuits heard by the Juvenile and Domestic Relations District Courts.
Now, the statutory exceptions themselves will lay out in each specific part how the court makes its determination - and not all statutory exceptions are the same. For example, in a divorce, attorneys' fees are awarded "in light of all the equities of the case" - in other words, the judge is to make an attorney fee ruling he or she considers fair. In J&DR Court cases, however, attorneys' fees are to be awarded based pretty much solely on the relative ability of the parties to pay.
So, as you can see, the statutory exceptions give a great deal of discretion to judges. As a result, if you wish to enforce an attorney fee right which is granted by statute, you must convince a judge that you should be awarded such relief. You cannot simply demand that the other party pay all of your fees.
Exception 2 - Agreement
The next major exception is if the parties have agreed to apply the "English Rule" to their case. Many contracts, for example, will contain provisions that if a lawsuit is filed based on an alleged breach of the contract, the prevailing party will be entitled to his or her attorneys' fees.
With rare exception, when a lawsuit involves a contract and that contract provides for an attorneys' fee award, the judge is largely without discretion. If the agreement provides that the loser pays, then the judge must order the loser to pay. In these cases, it is much more reasonable to demand your fees from the other side at the outset.
Exception 3 - Sanctions
Virtually all court systems have provisions for dealing with lawsuits that are "frivolous." In Virginia, our provision is Virginia Code Section 8.01-271.1. This provision states that the signing of any "pleading" (court document) indicates that the person signing it (be it the attorney or an unrepresented party) has a good faith basis for believing that the pleading is reasonably based on law or fact. If this later turns out to be untrue, and the pleading was filed in bad faith, the lawyer, the lawyer's client, or both can be sanctioned (penalized) by the court. Amongst the penalties the court may impose is an attorneys' fee award.
Much like exception 1, sanctions are largely discretionary. If a judge finds that sanctions are warranted, the judge may not award fees at all, or only award some fees.
How Fee Awards Function
If you find yourself in an exception situation where a fee award might be possible, the first thing you need to understand is that your fees are your responsibility first and foremost. I've had clients say to me "do this, and then send the bill to the other party." No, that's not how it works. You owe the money to your attorney, and it is your responsibility to pay, even when the court has awarded you your attorneys' fees.
If the court awards you fees, it can come in two forms - an order to pay or a judgment. As I've discussed before, an order to pay is a ruling that requires the person to pay under penalty of contempt of court. A judgment, however, only creates the duty to pay on paper, and then you still have to engage in post-judgment collections to get the money.
The easiest way to tell which situation you are in is to see if the judge provided a payment deadline. If they did, then it's probably an order to pay, and if they did not, then it is probably a judgment. More generally, most (but not all) attorneys' fee awards arising out of agreements are judgments, and most (but not all) attorneys' fee awards arising out of sanctions are orders to pay. For statutory exceptions, it generally depends whether the case is "in law" or "in equity" - so divorce attorney fee awards are usually orders to pay, but estate dispute attorney fee awards are usually judgments.
So, the fact that some attorneys' fee awards are just judgments that must be garnished or otherwise collected should tell you right away that you must still pay your attorney first, but then you can try to get that money back. Even orders to pay, however, do not relieve you of your obligation to your attorney, since the other party may still refuse to pay. Most importantly of all, however, almost all attorneys' fees awards (both judgments and orders to pay) are dischargeable in bankruptcy, so if the other party declares bankruptcy, you can't collect the fee award, and you still have to pay your attorney.
In short, there is virtually no situation in which "do this and send the bill to the other party" is actually acceptable.
Conclusion
There are few things more frustrating to a wronged party that realizing that you still have to pay for your own attorney. While there are exceptions, these are frequently hard to understand, and harder still to enforce. If you'd like to discuss whether an attorney fee award is possible in your case, please feel free to call (703)281-0134 or e-mail me at SLeven@thebaldwinlawfirm.com for a consultation. Our initial consultations are free for up to half an hour!
Friday, October 23, 2015
Tuesday, October 13, 2015
The Baldwin Law Firm Has a New Website
As regular readers of my blog know, I am not a solo practitioner. Rather, I work for a wonderful small law firm in Fairfax County, Virginia called The Baldwin Law Firm.
Today, I'm pleased to announce that our firm has a brand new website (first major re-vamping of the firm's website in more than a decade!). Please check us out at http://www.thebaldwinlawfirm.com!
Today, I'm pleased to announce that our firm has a brand new website (first major re-vamping of the firm's website in more than a decade!). Please check us out at http://www.thebaldwinlawfirm.com!
Friday, October 9, 2015
Multiple Tenants in Virginia - What to Do when Tenants Don't Get Along
As always, prior to reading this post, please review my disclaimer by clicking on the link above or by clicking on this link. As always, any legal principles discussed apply only to the Commonwealth of Virginia.
Introduction
One of the most complicated issues I face as a landlord/tenant attorney is the issue of what to do when two tenants in the same property don't get along. This matter is complicated whether I'm representing the landlord or one of the tenants, yet it is frequently made even more complicated because neither the landlord nor the tenant did any advance planning for the possibility of a dispute between tenants. Unfortunately, most of these disputes end up being costly and unpleasant for all involved, and much of the expense could have been saved with proper planning.
In this post, I'll address some of the basics of how to address a tenant dispute when it arises (from either the landlord or tenant's perspective), and then I will discuss a few ways advanced planning can prevent these disputes from escalating.
Know Which Law Applies
I've discussed many times before the difference between leases that are and are not covered by the Virginia Residential Landlord and Tenant Act (for a basic breakdown of figuring out which law applies to you, view my post here). This is a situation where it does matter whether or not your lease is covered by the VRLTA - especially if you are the landlord.
What a Landlord Should Do if Tenants are Fighting
As the landlord, if two tenants are fighting, it might be your temptation to throw up your hands and say "not my problem, you two work it out." This would be a mistake. A landlord is under an obligation to provide a home that is habitable and tenantable, and that includes a home where the tenant is safe and free from improper invasion of privacy, harassment, etc. If a tenant has a legitimate dispute with their fellow tenant in that their fellow tenant is actually preventing them from having quiet enjoyment of the property, they could be within their rights to terminate their lease early, force you to return their security deposit, and leave you with a smaller rent check each month than you had planned. Worse yet, if word of your lack of caring gets around, you may have trouble finding a new tenant. In other words, yes, it is your problem.
The first step you should take as a landlord is to investigate your lease to see if the offending tenant has, in fact, violated any provision of your lease. If they have, you can proceed with action for a breach of the lease against the tenant, including a 21/30 notice if your lease provides for it or is covered by the VRLTA. If, however, the offending tenant has not actually violated the lease, you could be in some trouble. If your lease is covered by the VRLTA, you have the right under Virginia Code Section 55-248.17 to adopt rules and regulations for how your tenants are to behave in the property - the only restrictions are that the rules must be reasonable, and must not amount to a "substantial modification" of the lease in which they entered. It is very unlikely that reasonable rules about how your tenants behave towards each other will be such a substantial modification, however. This is important, because once those rules are adopted (and I do recommend consulting an attorney in order to ensure they are prepared and adopted properly), a violation of those rules is legally equivalent to a violation of the lease.
The common law has no identical provision, however, and so if you have a common law lease, you can only adopt such rules and regulations if the lease expressly allows you to (I've said this before, and I'll say it again, the VRLTA leases is a double-edged sword and there absolutely are circumstances where it is more favorable to a landlord than the common law). If you have a common law lease and the lease does not include a rules and regulations clause, I would strongly advise you to consult with an attorney on how to proceed.
What a Tenant Should Do in a Dispute with Another Tenant
The first thing a tenant experiencing problems with another tenant should do is try to resolve your issues. If that fails, you should alert the landlord as soon as possible. This will give you an opportunity to see if your landlord will work with you to resolve the dispute. If your landlord fails to act, however, then you need to assess whether or not the other tenant is breaching the lease, violating the law, violating properly adopted rules or regulations, or is engaging in conduct that is making the home unlivable for you. If any of those situations is occurring, you likely have the right to provide a 21/30 notice to the landlord requiring the landlord to fix the situation within 21 days, or terminating your lease in 30 days (a more detailed explanation of 21/30 notices is in my post here).
How to Prevent these Issues
It probably does not surprise you that the vast majority of tenant dispute cases I see, both representing landlords and representing tenants, are cases where a) the lease is not governed by the VRLTA, b) the lease does not have a rules and regulations provision, and c) the offending tenant is not in actual violation of the lease or the law. Most of those cases, the landlord actually is interested in helping the tenant, but because of the way the law works, the cases end with the landlord agreeing to terminate the offended tenant's lease at no penalty. The landlord's not happy - they've lost a good tenant and are stuck with a bad one, and the offended tenant's not happy - they've had to move through no fault of their own. The sad thing is, it doesn't have to be this way.
First and foremost, landlords planning to rent to multiple tenants, and tenants planning to live with other tenants, should ensure that your lease itself contains provisions that not only outline a tenant's duties towards the property, but also a tenant's duties towards other tenant's. At a minimum, the lease should require tenant's to behave in a respectful manner towards each other, forbid tenants from entering the bedrooms of other tenants unless invited, forbid tenants from harassing or stalking other tenants, and require tenants to share household chores in a reasonable manner.
Additionally, all leases (even VRLTA leases, since it's always better to have in the lease instead of just the law) should have a rules and regulations provision. The provision should lay out how rules can be made, how they are adopted, how they come into force, and the effect of violating a rule or regulation. The simple reality is, the best lease drafter in the world cannot foresee every issue that might come up, and it's always a good idea to give you some power to handle issues as they may arise.
Conclusion
Disputes between tenants in a multiple tenancy property are one of the toughest issues we face in landlord/tenant law. It is made much tougher by the fact that most landlords renting to multiple tenants simply are not prepared for the possibility of such a dispute. With proper planning, such disputes do not need to be the horror show that they tend to be. If you are dealing with a tenant dispute, or would like to plan a lease or rules and regulations to deal with tenant disputes, please feel free to call (703)281-0134 or e-mail me at SLeven@thebaldwinlawfirm.com. We offer free initial consultations for up to half an hour! Also, our firm just completely revamped our website - you should feel free to check it out here.
Introduction
One of the most complicated issues I face as a landlord/tenant attorney is the issue of what to do when two tenants in the same property don't get along. This matter is complicated whether I'm representing the landlord or one of the tenants, yet it is frequently made even more complicated because neither the landlord nor the tenant did any advance planning for the possibility of a dispute between tenants. Unfortunately, most of these disputes end up being costly and unpleasant for all involved, and much of the expense could have been saved with proper planning.
In this post, I'll address some of the basics of how to address a tenant dispute when it arises (from either the landlord or tenant's perspective), and then I will discuss a few ways advanced planning can prevent these disputes from escalating.
Know Which Law Applies
I've discussed many times before the difference between leases that are and are not covered by the Virginia Residential Landlord and Tenant Act (for a basic breakdown of figuring out which law applies to you, view my post here). This is a situation where it does matter whether or not your lease is covered by the VRLTA - especially if you are the landlord.
What a Landlord Should Do if Tenants are Fighting
As the landlord, if two tenants are fighting, it might be your temptation to throw up your hands and say "not my problem, you two work it out." This would be a mistake. A landlord is under an obligation to provide a home that is habitable and tenantable, and that includes a home where the tenant is safe and free from improper invasion of privacy, harassment, etc. If a tenant has a legitimate dispute with their fellow tenant in that their fellow tenant is actually preventing them from having quiet enjoyment of the property, they could be within their rights to terminate their lease early, force you to return their security deposit, and leave you with a smaller rent check each month than you had planned. Worse yet, if word of your lack of caring gets around, you may have trouble finding a new tenant. In other words, yes, it is your problem.
The first step you should take as a landlord is to investigate your lease to see if the offending tenant has, in fact, violated any provision of your lease. If they have, you can proceed with action for a breach of the lease against the tenant, including a 21/30 notice if your lease provides for it or is covered by the VRLTA. If, however, the offending tenant has not actually violated the lease, you could be in some trouble. If your lease is covered by the VRLTA, you have the right under Virginia Code Section 55-248.17 to adopt rules and regulations for how your tenants are to behave in the property - the only restrictions are that the rules must be reasonable, and must not amount to a "substantial modification" of the lease in which they entered. It is very unlikely that reasonable rules about how your tenants behave towards each other will be such a substantial modification, however. This is important, because once those rules are adopted (and I do recommend consulting an attorney in order to ensure they are prepared and adopted properly), a violation of those rules is legally equivalent to a violation of the lease.
The common law has no identical provision, however, and so if you have a common law lease, you can only adopt such rules and regulations if the lease expressly allows you to (I've said this before, and I'll say it again, the VRLTA leases is a double-edged sword and there absolutely are circumstances where it is more favorable to a landlord than the common law). If you have a common law lease and the lease does not include a rules and regulations clause, I would strongly advise you to consult with an attorney on how to proceed.
What a Tenant Should Do in a Dispute with Another Tenant
The first thing a tenant experiencing problems with another tenant should do is try to resolve your issues. If that fails, you should alert the landlord as soon as possible. This will give you an opportunity to see if your landlord will work with you to resolve the dispute. If your landlord fails to act, however, then you need to assess whether or not the other tenant is breaching the lease, violating the law, violating properly adopted rules or regulations, or is engaging in conduct that is making the home unlivable for you. If any of those situations is occurring, you likely have the right to provide a 21/30 notice to the landlord requiring the landlord to fix the situation within 21 days, or terminating your lease in 30 days (a more detailed explanation of 21/30 notices is in my post here).
How to Prevent these Issues
It probably does not surprise you that the vast majority of tenant dispute cases I see, both representing landlords and representing tenants, are cases where a) the lease is not governed by the VRLTA, b) the lease does not have a rules and regulations provision, and c) the offending tenant is not in actual violation of the lease or the law. Most of those cases, the landlord actually is interested in helping the tenant, but because of the way the law works, the cases end with the landlord agreeing to terminate the offended tenant's lease at no penalty. The landlord's not happy - they've lost a good tenant and are stuck with a bad one, and the offended tenant's not happy - they've had to move through no fault of their own. The sad thing is, it doesn't have to be this way.
First and foremost, landlords planning to rent to multiple tenants, and tenants planning to live with other tenants, should ensure that your lease itself contains provisions that not only outline a tenant's duties towards the property, but also a tenant's duties towards other tenant's. At a minimum, the lease should require tenant's to behave in a respectful manner towards each other, forbid tenants from entering the bedrooms of other tenants unless invited, forbid tenants from harassing or stalking other tenants, and require tenants to share household chores in a reasonable manner.
Additionally, all leases (even VRLTA leases, since it's always better to have in the lease instead of just the law) should have a rules and regulations provision. The provision should lay out how rules can be made, how they are adopted, how they come into force, and the effect of violating a rule or regulation. The simple reality is, the best lease drafter in the world cannot foresee every issue that might come up, and it's always a good idea to give you some power to handle issues as they may arise.
Conclusion
Disputes between tenants in a multiple tenancy property are one of the toughest issues we face in landlord/tenant law. It is made much tougher by the fact that most landlords renting to multiple tenants simply are not prepared for the possibility of such a dispute. With proper planning, such disputes do not need to be the horror show that they tend to be. If you are dealing with a tenant dispute, or would like to plan a lease or rules and regulations to deal with tenant disputes, please feel free to call (703)281-0134 or e-mail me at SLeven@thebaldwinlawfirm.com. We offer free initial consultations for up to half an hour! Also, our firm just completely revamped our website - you should feel free to check it out here.
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