news, views & events


    By: Ron Ponzoli, Chair, Religious Organizations Practice Group 

    WEST PALM BEACH, FL – April 22, 2019 –  The business world is driven by contracts.  Religious organizations are not insulated from this reality.  If a synagogue needs a new roof, if a church has a hole in the parking lot that needs repair, if a loan is necessary to construct a new Buddhist temple, each of these events will require a written contract.

    Parties can agree that if they end up in a lawsuit over the contract, the party who loses the case will pay the winning parties’ reasonable attorney’s fees. But should a religious organization agree to a prevailing party fee provision?

    What should be considered when faced with this question is which party has more to lose from a prevailing party fee provision. For example, if a well-funded religious organization contracts with a small contractor who has limited resources, the religious organization agreeing to a prevailing party provision may not make sense.  The only party in that example who has the means to pay the other party’s attorney’s fees is the religious organization. Conversely, if a modest religious organization is contracting with a major financial institution, then the religious organization agreeing to the fee provision makes more senses.  In litigation, a prevailing party fee provision can become the rock that brings down Goliath.  Prevailing party fee provisions level the playing field for the smaller party: if the smaller party wins, it can recoup the financial burden of going through the courts.

    It is also important to understand that in Florida, a religious organization does not eliminate the risk of paying an opposing party’s fees by entering into a contract that only allows the religious organization to recover fees.  Florida statute permits the award of prevailing party fees to a party who wins a case under a contract that expressly provides only the opposing party may recover fees.

    Therefore, careful thought should be given to the economic realities of the contracting parties when considering a prevailing party fee provision.  The attorneys at GrayRobinson can counsel religious organizations on the best strategies for these, and other, contract terms.

    Remain informed of legal issues affecting all manners of religious organizations by visiting the Religious Organizations Law Blog.

     



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