Common-Fund Doctrine Law & Legal Definition


Common Fund Doctrine refers to a principle that a litigant who creates, discovers, increases, or preserves a fund to which others also have a claim is entitled to recover litigation costs and attorney's fees from that fund. That doctrine is an equitable doctrine designed to prevent unjust enrichment.

The rule is founded upon the principle that one who preserves or protects a common fund works for others as well as for himself, and the others so benefited should bear their just share of the expenses, including a reasonable attorney's fee; and that the most equitable way of securing such contribution is to make such expenses a charge on the fund so protected or recovered.[Knebel v. Capital Nat'l Bank, 518 S.W.2d 795, 799 (Tex. 1974)]

Common-fund doctrine is also known as equitable-fund doctrine.