In re Schold

Summarized by David Baker , Law Office of David G. Baker
10 years 9 months ago

Citation:

1st Cir. BAP 14-074 (Unpublished)

Tag(s):

Ruling:

Bankruptcy court order significantly reducing debtor's attorney's fees vacated and remanded for further proceedings.

Procedural context:

This was a chapter 13 case with significant litigation, including an Adversary Proceeding. Prior to the case being dismissed, debtor's attorney file a fee application for $55,692.50. Because the bankruptcy court felt that debtor's attorney had not properly discharged his duties, the fee award was reduced to $10,000, even though there were no objections to the application. Debtor's attorney appealed.

Facts:

Debtors were "business debtors", and as such, were required by Local Rule to file monthly operating reports with the chapter 13 trustee. They failed to do so. The trustee, however, stated that her policy was not to seek dismissal if the reports were not filed. In this case, a creditor filed the motion to dismiss because the reports were not filed, which the court allowed. As regards counsel's fee application, the bankruptcy court chastised the attorney for not making sure the reports were filed, even though the attorney chronicled his efforts to the the debtor to file the reports. The BAP vacated the order reducing the fee amount because the bankruptcy court failed to conduct a "lodestar" analysis of the fee application, or otherwise explain the reason for the reduction. The BAP appears to have accepted that a reduction might be warranted, but without any explanation of the bankruptcy court's reasoning, the order had to be vacated and the matter remanded for further proceedings.

Judge(s):

Finkle (author), Deasey & Cary

ABI Membership is required to access the full summary. Please Sign In using your ABI Member credentials. Not a Member yet? Join ABI now - it is absolutely worth it!