Hosseini v. Key Bank, N.A. (In re Hosseini)

Summarized by Albert Sheen , U.S. Bankruptcy Court
12 years 2 months ago

Citation:

B.A.P. No. CC-12-1516-DKiTa (9th Cir. B.A.P. Dec. 19, 2013) [Not for Publication]

Tag(s):

Ruling:

In an unpublished decision, the Ninth Circuit Bankruptcy Appellate Panel affirmed the bankruptcy court, holding that the bankruptcy court did not abuse its discretion in awarding debtor only $10.82 in costs for service of process, since those were the only costs in debtor's bill of costs that were recoverable under FRBP 7054 and C.D.Cal. Local Bankr. Rule 7054-1. The court also held that the bankruptcy court did not abuse its discretion in denying debtor's attorney's fees motion, because (1) 11 U.S.C. § 523(a)(8) did not authorize an award of fees in an adversary proceeding; (2) the adversary proceeding did not concern the terms of the promissory note and therefore the contractual award of attorney's fees did not apply; and (3) the adversary proceeding was a dischargeability action and not a contract action, and therefore the attorney's fees provision of California Civil Code § 1717 did not apply.

Procedural context:

Appeal from the Bankruptcy Court for the Central District of California (Altenburger, J.), awarding debtor only $10.82 in costs and denying debtor's attorney's fees motion in its entirety, reviewed for abuse of discretion.

Facts:

The debtor obtained a prepetition student loan from Key Bank, N.A. ("Key Bank") to fund his medical school education. After the debtor filed a chapter 7 bankruptcy petition, the debtor initiated an adversary proceeding to discharge his student loan debt under 11 U.S.C. § 523(a)(8). The bankruptcy court granted judgment in debtor's favor, discharging his entire student loan debt to Key Bank. The debtor then filed a bill of costs in the amount of $4,960.39 incurred by his attorney in the adversary proceeding. The debtor also filed a motion to recover $110,701.50 in attorney's fees ("attorney's fees motion") incurred by the debtor's counsel in the adversary proceeding. In his attorney's fees motion, the debtor argued that the promissory note for his student loans authorized him to seek attorney's fees as the prevailing party in the adversary proceeding. The debtor also relied on California Civil Code § 1717, which awards attorney's fees to parties who prevail in a contract action.

Judge(s):

Dunn, Kirscher, and Taylor

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