Opinion ID: 763539
Heading Depth: 3
Heading Rank: 1

Heading: The distinction between loser-pays and bad-faith attorney's fees

Text: 38 This court recognizes a distinction, as do other courts and commentators, between loser-pays attorney's fees, that is, attorney's fees awarded to a party simply because it prevailed, and attorney's fees assessed for a willful violation of a court order or against a losing party who acted in bad faith, vexatiously, wantonly, or for oppressive reasons [hereinafter bad-faith attorneys fees]. See, e.g., Servicios Comerciales, 145 F.3d at 480 n. 9 (noting that a rule awarding loser-pays attorney's fees has a much better claim to being 'substantive' than a rule awarding attorney's fees only as a sanction for frivolous litigation.). 39 Loser-pays attorney's fees are normally not within a court's inherent power. Instead, they reflect a conscious policy choice by a legislature to depart from the American rule and codify the English rule. See 20 Am.Jur.2d Costs § 57 (1995) (Fees paid to attorneys are ordinarily not recoverable from the opposing party as costs, in the absence of express statutory or contractual authority.). The authority to award bad-faith attorney's fees, though frequently codified, is usually within a court's inherent powers, which it has discretion to exercise in the interest of justice and efficient judicial administration. For example, the Oklahoma Supreme Court noted that a court's inherent power to make an award of attorney's fees against an opponent under the 'bad faith' exception to the American Rule was based upon its need to manage its own affairs so as to achieve the orderly and timely disposition of cases. Winters v. City of Oklahoma City, 740 P.2d 724, 725 (Okla.1987) (discussing Roadway Express, Inc. v. Piper, 447 U.S. 752, 764-65, 100 S.Ct. 2455, 65 L.Ed.2d 488 (1980)); see also Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 478 U.S. 546, 562 n. 6, 106 S.Ct. 3088, 92 L.Ed.2d 439 (1986). 40 The attorney's fees provided by § 936 are not assessed for bad-faith litigation; they are instead simply granted to the prevailing party. While courts award bad-faith attorney's fees for reasons related to judicial administration, § 936 attorney's fees do not seem to fit the same rubric. See Servicios Comerciales, 145 F.3d at 481 n. 9.