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Commercial Leasing Law & StrategyFeaturesCommercial LitigationFee DisputesLandlord Tenant LawLitigation

Fees on Fees

By Joseph I. Farca

Does your New York commercial lease form expressly provide that the landlord may recover the legal fees it incurs to recover legal fees from its tenant? If not, then the landlord may be out of luck trying to recover such "fees on fees," as they are known. But it wasn't always this way.

New York law provides that a prevailing party in litigation may recover attorneys' fees from the losing party only where such recovery is authorized by an agreement between the parties, by statute or by court rule. See, Hooper Associates, Ltd. v. AGS Computers, Inc., 74 NY2d 487, 491 (1989), followed by TAG 380, LLC v. ComMet 380, Inc., 10 NY3d 507, 515-16 (2008); A.G. Ship Maint. Corp. v. Lezak, 69 NY2d 1, 5 (1986). To be entitled to recover legal fees, the party seeking such fees must be the prevailing party with respect to the central relief it sought in such action or proceeding. See, Nestor v. McDowell, 81 NY2d 410, 415-16 (1993), and 25 East 83 Corp. v. 83rd Street Assocs., 213 AD2d 269 (1st Dept. 1995), both followed by Vanchiro v. Powells Cove Owners Corp., 135 AD3d 851, 852-53 (2nd Dept. 2016).

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