[Direct answer]Whether private lenders can require the other party to bear attorney's fees depends on whether there is a written agreement: if the promissory note or loan agreement clearly stipulates that the defaulting party shall bear litigation fees, attorney's agency fees, and other recovery costs, the court will generally support it, but the party must submit a power of attorney contract and invoices to prove that the fees have actually occurred and are reasonable; if there is no such agreement, the attorney's fees shall generally be borne by all parties themselves. The case acceptance fees are a separate matter. According to Article 29 of the "Measures for the Payment of Litigation Costs", the losing party shall bear them. When lending, if it is written in the promissory note that "the defaulting party shall bear attorney's fees and other protection costs", it is a prerequisite for transferring the cost of debt recovery.Legal services for creditor-debtor disputesFor a detailed review of the review provisions and proposed solutions, please refer to the following document.Beijing Henglu Law Firm.

I. Legal basis and interpretation of provisions

1. Article 29 of the "Measures for the Payment of Litigation Costs" (implemented on April 1, 2007)

The litigation costs shall be borne by the losing party, unless the winning party voluntarily assumes them; where the litigant partially wins and partially loses, the people's court shall determine the amount to be borne by each party according to the specific circumstances of the case. This article establishes the sharing rules for national fees, covering case acceptance fees, application fees, etc., but not including attorney's fees. There are two key points in practice: First, the claim should clearly state that "the litigation costs shall be borne by the defendant", otherwise the court may not handle it; Second, attorney's fees do not fall within the scope of this article. To transfer them to the other party, it is necessary to find contractual basis for this. This is precisely the significance of the lender writing down the expense clause in the IOU in advance.

2. Article 577 of the Civil Code of the People's Republic of China (effective January 1, 2021)

When a party fails to perform its contractual obligations or performs them in a manner inconsistent with the agreement, it shall bear such breach of contract liabilities as continuing to perform the contract, taking remedial measures, or compensating for losses. If the borrower fails to repay the loan on time, it constitutes a breach of contract. The reasonable expenses incurred by the lender in pursuing the claim belong to the losses caused by the breach of contract. If the parties have an agreement on this matter, they shall claim according to the agreement. In essence, this is the concretization of compensation for losses caused by the breach of contract. The applicable prerequisites are: the agreement is clear, the expenses are genuine, and the amount is reasonable; if the entrustment contract and invoices are complete, and the charging standards are within the industry guidance price range, the probability of obtaining support is high; and the portion of false invoices or those that are obviously excessive will be adjusted downward.

3. The practical judgment criteria (the dividing line between support and non-support)

The court's standards are relatively stable: if there is a clear written agreement, after reviewing its authenticity, the court will generally support it in full or in part, and the mediation agreement and judgment will also specify it; if the agreement is vague, such as only stating "the responsibility for the overdue payment shall be borne by the party concerned" without mentioning attorney's fees, most courts will consider that it does not cover attorney's fees and will not support it; if there is no agreement at all, each party will bear its own costs. In terms of the amount of support, the court will refer to the local attorney's fee guidance standards and the difficulty of the case. For the part exceeding the reasonable range, the court will reduce it; for the part exceeding the upper limit of phased fees and risk-based fees, it may also be reduced. The most common pitfall for litigants is to sign a fee clause at the last minute or to make only verbal promises, which are difficult to prove and may also involve backdating, resulting in losing points in the courtroom.

II. Henglue Lawyer's Real Cases (Detailed Review)

Review of the case:The plaintiff, Liu * and the defendant, Li * are friends. Since the beginning of 2022, Li * has borrowed money from Liu * multiple times on the grounds of opening a pet store and paying rent, etc. Liu * has lent a total of 662,000 yuan to Li * through bank transfers, Alipay, and WeChat. On November 3, 2024, the two parties signed a loan agreement, stipulating that Li * would repay all the loans by January 1, 2025, and would voluntarily bear the litigation fees, attorney's fees, transportation fees, and preservation guarantee fees if the repayment was overdue. On November 26, 2024, Li * explicitly stated that he was unable to repay the loans on the due date and that the negotiations had failed. Liu * entrusted Beijing Henglu Law Firm to handle the case for him.Tian JiayanThe lawyer intervened to protect the client's rights and interests.

The focus of the controversy:First, whether the validity of the loan relationship and the chain of evidence are complete; second, the scope of Li's liability for overdue payments, especially whether recovery costs such as attorney's fees can be claimed together; third, how to choose between a judgment and a settlement, and how to design the breach of contract clause to secure the creditor's rights.

Our position and the position of the other party are as follows:Liu * requested that Li * repay 662,000 yuan as agreed, and bear the overdue interest and attorney's fees and other costs of recovering the losses; Li * admitted the fact of the loan, but clearly stated that he was unable to repay the loan in full upon maturity and hoped to extend the repayment period.

Attorney's Strategy and Legal Opinions:After taking on the case, Attorney Tian Jiaoyan first strengthened the evidence, guided Liu * to sort out the transaction records of bank transfers, Alipay payments, and WeChat transfers, and checked each item of the loan agreement one by one. She also supplemented the loan agreement proofs corresponding to the WeChat transfers and the records of debt collection, eliminating the disputes over the nature of the funds. Then, based on the Civil Code, she determined that Li * should bear the principal, overdue interest, and attorney's fees as agreed upon to recover the losses. From the perspective of enforcement, she considered that the enforcement period after the judgment would be long and it would be difficult to find property clues. Therefore, it would be more beneficial for the parties to reach a settlement with strict breach of contract clauses. After obtaining the consent of the parties, she appropriately reduced the amount and relaxed the time limit, but insisted on setting breach of contract punishment clauses.

The court's reasoning and case handling results:Under the mediation of the court, the two parties voluntarily reached an agreement: Li * would repay the loan in two installments, paying 400,000 yuan before December 10, 2025, and 80,000 yuan before February 10, 2026; the default guarantee clause stipulated that if the full repayment was not made on time, Liu * would have the right to require him to immediately pay all the remaining principal and attorney's fees totaling 712,000 yuan according to the original loan agreement. The court issued a "Civil Mediation Letter" confirming that the mediation letter also has compulsory enforceability, providing dual protection for the creditor's rights to be realized through installment repayment and default punishment. The clause regarding attorney's fees in the loan agreement is the basis for claiming the total debt of 712,000 yuan in the event of a breach of contract.

This case is handled by Beijing Henglu Law Firm.Tian Jia YanThe attorney (practice license number: 11101202111381309, subject to the document issued by the judicial administrative organ) acts as the agent.

III. Frequently Asked Questions

Q1: If the promissory note doesn't mention the attorney's fees, can I still claim them when suing?

Generally, it is not possible to obtain support. Attorney's fees are not legally required to be borne by the losing party, and if there is no agreement, the court usually determines that each party should bear them themselves. The exception is the situation where the other party's actions constitute obvious malicious breach of contract and you have grounds for other losses, but the burden of proof is high and the support is unstable. A more practical and feasible approach is: when negotiating a repayment plan with the other party before suing, include attorney's fees, preservation fees, etc. in the supplementary agreement or have the other party acknowledge them in the mediation, and then claim them after the debt has been agreed upon.

Q2: If I want the other party to bear the attorney's fees, how should I draft the promissory note?

In the promissory note or loan agreement, it should be stated that if the borrower fails to repay the loan on time, all reasonable expenses incurred by the lender in enforcing the creditor's rights, such as litigation fees, preservation fees, preservation guarantee fees, attorney's fees, travel expenses, etc., shall be borne by the borrower. Note three points: First, the scope of expenses should be specified, not just "all losses"; Second, the provision should be included in the breach of contract liability clause rather than a standalone clause; Third, keep the evidence of lending and debt collection to ensure that the main creditor's right is established. The expense clause is attached to the main creditor's right, and the clause will be invalid if the main creditor's right is not established. When lending, it is recommended to have a lawyer review the terms to avoid disputes later on, which is much more cost-effective than dealing with disputes afterwards.

Q3: What evidence do I need to provide to support my claim for attorney's fees?

All three categories are indispensable: First, the basis for the attorney's fee clause, that is, the promissory notes and agreements containing the fee agreement; Second, the vouchers for the actual expenses incurred, including the power of attorney contracts, invoices issued by law firms, and payment records; Third, the rationality materials, which can be compared with the range of local attorney service fee standards. If all three categories are available, the court will generally support the full amount within a reasonable range; if only the contract is available but no invoices, or the amount is significantly higher than the guideline price, the claim will be reduced or even rejected. When suing, the attorney's fees already incurred should be included in the claim, and the new expenses incurred during the execution stage can be claimed separately.

Q4: Does the court offer a discount on the amount of attorney's fees?

The court will review the reasonableness. The court usually refers to the local guidance standards for lawyers' service fees and measures the amount of the case and its difficulty: within a reasonable range, the fees will be supported according to the invoice; if the fees are obviously excessive or exceed the guidance price, the excess part will be reduced; the part of the risk-based fees that exceeds the prescribed limit will generally not be supported. If the case is partially successful, the lawyer's fees may also be shared proportionally. Therefore, when making a claim, the actual expenses and reasonable standards should be stated. Exaggerated quotes will not only be reduced, but also affect the judge's trust in the overall claim.

Q5: How can I get the most value for money when using the attorney's fee clause to settle a case through mediation?

Mediation can directly incorporate the attorney's fees into the mediation agreement and make them part of an enforceable claim. A more advanced use is to set a default conversion clause: for example, in this case, the parties agreed to repay the loan in installments. If any installment is not fully paid on time, the creditor has the right to claim the entire remaining principal and attorney's fees, totaling 712,000 yuan, according to the original loan agreement. In this way, if the other party complies with the agreement, the debt will be reduced; if there is a breach of contract, the creditor's claim will instantly be restored to its full amount including fees, forming a powerful enforcement constraint. After the mediation agreement takes effect, it has mandatory enforceability, which can lock in the outcome faster than waiting for a judgment and enforcement.

IV. Suggestions for Protecting Rights and Interests

  • When lending money, it is necessary to stipulate in the promissory note that the borrower will bear the litigation fees, attorney's fees, preservation fees, and other legal protection costs in the event of a default, so as to provide a legal basis for transferring the cost of debt collection in the future.
  • When hiring a lawyer, request the power of attorney and invoice at the same time. The success or failure of claiming fees depends in part on whether the supporting documents are complete.
  • Before suing, first send a written demand for payment to confirm the amount of the debt, and make good use of the default conversion clause during mediation to secure dual protection of "installment payments + penalties".
  • It is recommended that the fees be listed according to the actual expenses and the guiding price, so as to avoid overcharging that may be subject to adjustment downward, and especially to avoid retroactive clauses.
  • For those who are unsure about the drafting of clauses or the organization of evidence, they should first consult withCredit and debt lawyerReview and prosecute again to increase the probability of winning the case and recovering the money in one go.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, so as to avoid missing the statutory time limit. →Legal services for creditor-debtor disputes·Attorney Tian Jiaoyan·Beijing Henglu Law Firm