Illinois Attorney Fee Recovery
The question often arises as to whether attorney fees are part of a recovery from the other party. The quick answer is, yes, in some cases attorney fees can be recovered from the other side.
The Illinois Insurance Code, set out in full below, allows, but does not require, attorney fees if there was an unreasonable delay in settling a claim and such action or delay was vexatious and unreasonable. There has been much litigation on the meaning of vexatious and unreasonable. The general meaning has established a very high hurdle resulting in the recovery of attorney fees only in the most outrageous of situations. Even if successful in a claim for attorney fees, there are several limits which effectively cap the recover at $60,000.
There are often various bills pending in the Illinois legislature that seek to refine, repeal, or revise the 155 attorney fee statute. For example, HB0229 (not passed) proposed to revise section 155 to allow unlimited attorney fees in any action against a company where the company has committed fraud.
The statute in effect at this time, January 1, 2010, provides as follows:
Illinois Insurance Code, 215 ILCS 5/155, Attorney fees.
(1) In any action by or against a company wherein there is in issue the liability of a company on a policy or policies of insurance or the amount of the loss payable thereunder, or for an unreasonable delay in settling a claim, and it appears to the court that such action or delay is vexatious and unreasonable, the court may allow as part of the taxable costs in the action reasonable attorney fees, other costs, plus an amount not to exceed any one of the following amounts:
(a) 60% of the amount which the court or jury finds such party is entitled to recover against the company, exclusive of all costs;
(b) $60,000;
(c) the excess of the amount which the court or jury finds such party is entitled to recover, exclusive of costs, over the amount, if any, which the company offered to pay in settlement of the claim prior to the action.(2) Where there are several policies insuring the same insured against the same loss whether issued by the same or by different companies, the court may fix the amount of the allowance so that the total attorney fees on account of one loss shall not be increased by reason of the fact that the insured brings separate suits on such policies.
(Source: P.A. 93‑485, eff. 1‑1‑04.)
