Curious about how "legal fees" are calculated as part of damages

Factual Questions
1

Who/how what fees are appropriate when the award in a civil suit includes legal fees? Does the judge use some standard formula, or does the awardee (and/or their legal team) file their billing statements for the judges approval?

I sometimes see the phrase “attorney’s fees” used*, rather than a more generic term (i.e. “legal costs”, “legal fees”). Are these two distinct things (with one possibly being a subset of the other), or simply the author’s preferred term?

Also, when a settlement/award does include fees or costs (whatever the proper term may be) does the lawyer receive more**, less, or the same amount they’d get from a party paying out-of-pocket?

  • when reading sites that don’t specialize in legal matters or have a large number of legal professionals in their target audience

** I’m absolutely not implying any legal professional would pad their bill simply because somebody other than their client is paying for it. I’m just thinking they might accept a lower payment from people who are paying out-of-pocket (like pharmacies and medical professionals sometimes do)

2

Although this varies by jurisdiction and court, when one party wins and is entitled to attorneys’ fees, that party will make a motion or application to which the lawyers’ bills, expense documents and other evidence of the fees and expenses are attached.

Typically, the losing side will be able to file objections, which might include that the winning lawyers spent excessive time, their billing rates are too high, the case was overstaffed, the winning party wasn’t all that successful, and any number of other grounds. The winning side will usually be able to reply.

After the submissions are complete, the court will decide on whether the requested fees are warranted, sometimes on the papers alone, sometimes after hearing oral argument from the attorneys, and sometimes after having a hearing at which the parties and lawyers present evidence that the fees were necessary and proper.

Generally, the courts try to determine whether the amount of legal time spent was appropriate and whether the billing rates properly reflect the experience, skill and reputation of the lawyers, although there are other factors that can be considered such as the risk the lawyer took in bringing the case and other legal work that he or she may have to turned aside in major cases.

As to the billing rates, some jurisdictions use formulas like the Laffey Matrix, which bases billing rates on the lawyers’ years out of law school and an inflation factor. Other jurisdictions base it more on the rate the lawyer usually collects from free-market paying clients and the court’s experience with attorney billing rates in the legal market.

For commercial and real estate litigation in New York, at least, attorney’s fee requests will usually be based on rates charged to clients paying out-of-pocket, though the judge will almost always give the a lawyer a bit of a “haircut” on the fees requested.

In unusual situations, the court may award the winning side legal fees with a “multiplier” over the regular fees that would have been billed, but this would only occur when the lawyer did extraordinary work where he or she had some personal and/or financial risk in bringing or prosecuting the case.

3

I believe that they are two different things. Legal fees is the money you’re charged by the court for actions like filing a lawsuit. Attorney fees are what the parties in the suit pay to the lawyers they hired.

4

In Canada, from what I understand (IANAL) the loser in a civil case typically pays the legal costs of the winner. From what I’ve read in the papers, the winner submits his lawyers’ bill; the loser can contest this in front of the judge if they feel the costs are excessive, and I recall reading of cases where the judge made adjustments.

A good system, discourages many frivolous lawsuits. I also remember reading about one class action suit that could not proceed because the plaintiffs could not scrounge up the money to post a bond to cover any losses. The judge agreed with the defendant that the case was shakey, so required surety.

Apparently, after a legal episode, you can also appeal your own lawyer’s costs if they seem excessive. I recall reading of these also being adjusted to reflect reality.