Payne Hackenbracht & Sullivan
Equal Access to Justice Act
The Equal Access to Justice Act (5 U.S.C. 504) was enacted by Congress in an effort to enable small businesses to receive compensation for attorneys' fees and expenses incurred in connection with contract claims and appeals. The Act contains a number of criteria and limitations regarding the application of the Act or recovery of fees. It is important for the construction contractor to be aware of the following provisions:
(1) The Act applies to individuals with a net worth of not more than $2,000,000.00, or unincorporated businesses, partnerships, or corporations with a net worth of not more than $7,000,000.00 and 500 employees.
(2) An Application for recovery of fees may only be made if the applicant was the prevailing party and it is found that the government's position was not substantially justified.
(3) Recovery will be limited to reasonable allocable fees and expenses. However, recovery of attorneys fees will be limited to $125.00 per hour regardless of the actual legal fees incurred.
(4) Contractors who appear pro se, i.e., represent themselves, cannot recover under the Act.
(5) Application must be made within thirty (30) days of the decision on the claim.
There are many other requirements and issues connected with this Act. If you are represented by counsel and meet the size standards noted above, it is important for you and your attorney to review the Act, and make a proper application. Presently, recovery under the Act has been limited, but contractors should be aware of its provisions and applicability.