Capping attorney fees seen as path to early court settlements

Usually, you pay your own lawyer.

But in more than 500 places, Minnesota law says one side in a civil legal dispute may be ordered to pay the other side’s attorney fees.

Rep. Jim Knoblach

Rep. Jim Knoblach (R-St. Cloud) wants to tamp down on such fee-shifting. His bill, HF923, would restrict awards for attorney costs if a defendant makes a monetary settlement offer, the plaintiff refuses the offer and goes to trial, and the verdict awards plaintiffs an amount less than the settlement offer.

In that situation, HF923 would prohibit judges from making defendants pay attorney fees the plaintiff incurred after the settlement offer.

“This isn’t a radical proposal,” Knoblach said. “This is basically what the federal rules are right now.”

The House Civil Law and Data Practices Policy Committee approved the bill, as amended, on a 9-6 roll-call, party-line vote Tuesday and sent it to the House Floor.

Attorney fees are a recurring issue at the Legislature.

Joel Carlson, chief lobbyist for the Minnesota Association for Justice, said he first testified against a forerunner of HF923 in 1998. Knoblach has carried similar legislation as far back as 2004. The effort has resurfaced periodically, such as in 2011.

The point, Knoblach said, is to encourage early settlements. Attorneys would no longer urge clients to proceed to trial with an eye toward landing a hefty attorney’s fee that’s out of proportion with the judicial award.

Opponents charged the bill would stifle a plaintiff’s ability to bring a suit or hire a lawyer. “It will absolutely eviscerate the ability of people who are the most marginalized to be able to access the court system and to be able to access their rights,” said Adrianna Shannon, a Minneapolis attorney.

Ron Elwood, supervising attorney at the Mid-Minnesota Legal Aid’s Legal Services Advocacy Project, warned the bill would “foster scams and reward scam artists. … Because of the small amount of damages sought and obtained, this bill would effectively prevent private attorneys from taking those cases.”

The companion, SF1210, sponsored by Sen. Jerry Relph (R-St. Cloud), awaits action by the Senate Judiciary and Public Safety Finance and Policy Committee.