Initiating or defending a proceeding over a disputed contract can be costly. The parties may recognize that the rights set forth in the agreement might not be worth the legal fees and costs of having to enforce or defend such rights in a vigorously-contested dispute. Contracts often include clauses stating that the prevailing party in any litigation arising out of or relating to the contract will be entitled to an award of their attorney’s fees and other legal costs.
Although Arizona law generally allows attorney’s fees to be recovered by the prevailing party in “any contested action arising out of a contract,” using an attorney’s fee clause could prove important if the particular type of litigation brought were found to fall outside the nuances of interpretation of the statute. Also, the attorney’s fee clause can additionally provide for recovery of post-judgment attorney’s fees and costs to collect or enforce an award or judgment.