Can a successful defendant get contractual attorneys’ fees?

A counterclaim defendant sought recovery of attorneys’ fees under the relevant lease agreements, leading the Fifth Court to review and apply the current Texas Supreme Court precedents on that subject:

1. One set of leases had the following fee provisions:

29.1 Attorney Fees. If this lease is placed in the hands of any attorney due to a default in the payment or performance of any of its terms, the defaulting party shall pay, immediately upon demand, the other party’s reasonable attorney fees, collection costs, costs of litigation, even though no suit or action is filed thereon, and any other fees or expenses incurred by the nondefaulting party.

29.2 Types of Fees. For purposes of this Lease the term attorney fees includes all

charges of the prevailing party’s attorneys and their staff (including without limitation legal assistants, paralegals, word processing, and other support personnel) and any post-petition fees in a bankruptcy court. . . .

The Court reasoned: “Under the broad language of [these] Leases, we agree, as the court did in Rohrmoos, that appellee was not just a plaintiff; he also successfully defended against appellants’ breach of contract counterclaim that sought unpaid lease payments and repair costs for damages to the premises,” and was thus entitled to fees as a “prevailing party” .

2. The second set of leases had this fee provision:

30. Attorneys’ Fees. In the event either party shall fail to comply with any of the covenants, conditions, obligations, rules, or regulations imposed by this Texas Commercial Lease or the laws of the state of Texas, and suit is brought for damages or enforcement, the losing party shall pay to the prevailing party reasonable attorneys’ fees, costs, and expenses incurred in prosecuting these suits.

“Here, the lease specifically requires that the attorneys’ fees be incurred by the
‘prevailing party’ in ‘prosecuting these suits.’ ‘Prosecute’ means ‘to institute legal proceedings against’ or ‘to institute and carry on a legal suit or prosecution: sue.'” Accordingly, the clause did not reach the counter-defendant’s claim, and recovery of fees was prohibited by Intercontinental Group v. KB Home, 295 S.W.3d 650 (Tex. 2009). Desio v. Del Bosque, No. 05-19-00224-CV (Dec. 19, 2019) (mem. op.)