§ 140.006.Attorney's Fees in Declaratory Judgment Action

A prohibition, and it runs against both sides.

Notwithstanding the Declaratory Judgments Act’s fee provision or any other law, if a declaratory judgment action is brought under this chapter, the court may not award costs or attorney’s fees to any party.

The Act it displaces ordinarily allows fees, giving a court discretion to award costs and reasonable and necessary attorney’s fees as are equitable and just. That provision is a well-known feature of Texas practice and a frequent reason declaratory relief is pleaded at all.

Removing it here is deliberate, and the reason is the imbalance. A dispute over how much a health plan may take from an injury settlement is between a well-resourced institutional payor and an injured individual. Fee exposure in a declaratory action would deter the individual from testing the payor’s claim, and would give the payor a threat worth more than the sum in dispute.

The prohibition is symmetrical — to any party — so the individual cannot recover fees either. Each side bears its own costs of establishing what the chapter requires.

Note the contrast with the next section, which does the opposite: it requires the payor to pay a fee to the individual’s attorney out of the payor’s share. The chapter distinguishes between litigating about the subrogation right, where nobody recovers fees, and obtaining the recovery itself, where the payor pays for the work that produced its money.

Note also that Chapter 37 is not yet published on this site; the reference here is to that Act’s fee provision.