AZ SB1556

Entitles a prevailing defendant in tort or contract actions to recover a percentage of costs from the plaintiff's attorney equal to the contingency percentage the plaintiff's attorney would have received if plaintiff had won.

Requires the defendant to notify the plaintiff's attorney in the initial response that it intends to request prevailment percentage costs, and allows recovery equal to defendant's costs multiplied by the defendant's prevailment percentage multiplied by the attorney's contingency percentage.

Requires the plaintiff's attorney to provide the court with documentation of the fee arrangement within 60 days after the lawsuit ends; if not provided, the court deems the contingency percentage to be at least 40 percent.

Does not apply to attorneys charging solely hourly rates, flat fees, or noncontingent pass-through expenses, nor does it apply if it conflicts with an enforceable contract between plaintiff and defendant.

Defines key terms including "contingency percentage," "defendant's costs" (reasonable attorney fees, court costs, and third-party defense expenses), "prevailment percentage," and "plaintiff's claim limit" for purposes of calculating cost recovery amounts.