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Related Articles: Commercial Landlord



When theLandlord Can Recover Attorney's Fees (Plantation House v. Anderson & Strudwick (1998))

Facts
Landlord sued Tenant for recovery of rents due under two commercial leases. Both leases contained a default clause as follows:

"Landlord shall also be entitled to recover rent f[rom] Tenant all costs of collection, including attorney fees." (Emphasis added).

The Tenant filed a counterclaim against the Landlord for breach of contract and constructive eviction. A jury verdict awarded judgments to the Landlord for rent in the amount of $10,000.00, and to the Tenant for breach of contract in the amount of $7,607.28.

Post-trial, Landlord filed a Motion for Attorney Fees and Costs, which included attorney fees incurred while defending the Tenant's counterclaim. The Tenant defended the Motion by arguing that attorney fees should only be collected under the Landlord's claim, and not under the Tenant's counterclaim.

Court Ruling
The lease provision provides for recovery of all costs of collection. The Landlord's defense to the Tenant's counterclaim was a "cost of collection, including attorney's fees" within the meaning of the lease provision.

Landlord is entitled to all the attorney fees it claims in the amount of $32,128.48, and $5,537.62 in costs.

Lease Drafting Tips
The Lease should state that in the event of a Tenant default, the Landlord shall be entitled to "all costs of collection, including but not limited to attorney fees". In addition, there should be a clause allowing recovery of attorney fees by Landlord "in the event of any dispute regarding the lease."

Action Advice
Sue the Tenant first! As the court stated, "But for the Plaintiff's collection suit, the defendant would not have filed its counterclaim", and the Landlord would not have to pay additional attorney's fees to defend the counterclaim.