It was about three years ago that the Florida Legislature adopted the Revised Uniform Arbitration Act (“RUAA”), a revised code that was intended to clarify the arbitration process and promote various requirements of due process. Among many issues the revision addresses, attorneys’ fees changes were one of the most significant, especially to the Financial Industry Regulatory Authority (“FINRA”) arbitrations.
Typically, the American rule of law does not automatically grant the winning side its attorneys’ fees. According to FINRA’s Basic Arbitrator Training, arbitrators can award attorneys’ fees when:
- the parties’ contract includes a clause that provides for attorneys’ fees; or
- all of the parties request or agree to such fees; or
- the fees are required as a part of the statutory claim.
While these rules remain, the revised code reduces the complexity of determining if attorneys’ fees are justified and determining the amount of the award.
Florida Statute § 682.11 of the revised code inserted provisions authorizing the arbitrator to award punitive damages and attorneys’ fees. The section provided that the arbitrator may only do so when these remedies would be authorized in a civil action regarding the same claim and, with respect to punitive damages, only where the generally applicable evidentiary standard for their award is met and when the arbitrator specifies in the award its basis.
In other words, arbitrators can now award attorney’s fees including the actual amount.
Prior to the revision, the Florida Supreme Court in Moser v. Barron Chase Sec., 783 So.2d 231, 234 (Fla. 2001) stated that jurisdiction to award attorneys’ fees was vested in the court. Under the law established by the case, arbitrators could decide whether or not a party was entitled to attorneys’ fees and state a legal basis for such an award, but only the courts could determine the actual amount and award it. The power to award attorney’s fees is found in Florida Statute § 517.301, the Florida Investor Protection Act.
This change further consolidates the FINRA arbitration process. Soon, the revised code will apply to all agreements regardless of when they were entered into.
Pursuant to Florida Statute § 682.013, the revised code automatically applies to all arbitration agreements entered into after July 1, 2013. As of July 1, 2016, in less than a month, the revised code will apply to all arbitration agreements, regardless of when made.
As stated earlier, this further simplifies the FINRA arbitration process. Rather than having to take the two-fold step of having an arbitrator determine whether attorneys’ fees are applicable then having a Florida court determine the amount of those fees, the RUAA allows for the arbitrators to determine both in one broad stroke and without judicial intervention.
No matter how the arbitrators rule, our clients will only pay us if we successfully recover money for them. In contrast to other Wall Street law firms where clients are billed by the hour, Silver Law Group generally works on a contingency fee basis, and we focus on our client’s success first.
Silver Law Group represents the interests of investors who have been the victims of investment fraud. If you have questions about your legal rights, please contact Scott Silver of the Silver Law Group for a free consultation at ssilver@silverlaw.com or toll free at (800) 975-4345.