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SC restricts lawyer fees in contractor disputes

By Legal News Line | Dec 28, 2006

Washington Supreme Court

OLYMPIA - Building and construction contractors who succesfully sue against another's surety bonds cannot collect additional attorney's fees outside of the value of that bond, the Washington Supreme Court ruled today. In the case of Cosmopolitan Engineering Group, Inc. vs. Ondeo Degremont, Inc. (SC#77661-0), the justices overruled an earlier Appeals Court decision that ruled "as a matter of law a prevailing party...is entitled to attorney fees against both the opposing contractor and its bond." Cosmopoltan had earlier won a $100,000 breach of contract dispute against Ondeo in a trial court and had successfully appealed to the Appeals Court for additional attorney fees to be paid by Ondeo. But the Supreme Court disagreed, stating that the amended law covering bonded contractors "expressly limits the aggregate recovery from the surety to the amount of the bond." The court added that the amended law's original framers understood the amendment's attorney-fees provision "to apply only to suits against the bonds." The decision concurred with the original Trial Court's decision to limit Cosmopolitan's attorney fees incurred during its original action to the amount available under Ondeo's bond.

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