In re Long

560 B.R. 728, 2016 Bankr. LEXIS 4128, 2016 WL 6884305
CourtUnited States Bankruptcy Court, W.D. Michigan
DecidedNovember 22, 2016
DocketCase No. DG 13-04953
StatusPublished

This text of 560 B.R. 728 (In re Long) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, W.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Long, 560 B.R. 728, 2016 Bankr. LEXIS 4128, 2016 WL 6884305 (Mich. 2016).

Opinion

MEMORANDUM OF DECISION AND ORDER

HONORABLE SCOTT W. DALES, Chief United States Bankruptcy Judge

I. INTRODUCTION

Martin Holmes, Esq., filed a fee application (the “Fee Application”) pursuant to 11 U.S.C. § 330(a)(4) seeking, approval of additional fees in the amount of $2,369.95 for representing chapter 13 debtors Sean Allen Long and Meredith Louise Long (the “Debtors”) in connection with their bankruptcy case. What distinguishes this fee application from most is that Mr. Holmes filed it after his clients had completed their payments under the chapter 13 plan. For the following reasons, the court will grant the Fee Application in part, and deny it in part.

II. JURISDICTION

The United States District Court for the Western District of Michigan has jurisdiction over the Debtors’ chapter 13 case pursuant to 28 U.S.C. § 1334(a), but has referred the exercise of that jurisdiction to the United States Bankruptcy Court pursuant to 28 U.S.C. § 157(a) and W.D. Mich. LCivR 83.2(a). Applications for approval of attorney fees under § 330 are “core proceedings” within the meaning of 28 U.S.C. § 157(b)(2)(A) and (B). The court, therefore, has authority to enter a final order resolving the Fee Application, at least to the extent set forth herein.

III.ANALYSIS

Although the Fee Application drew no objection after appropriate service, the court nevertheless set it for hearing, which took place on November 9, 2016 in Grand Rapids, Michigan. Only Mr. Holmes appeared at the hearing. After a brief colloquy with him and a review of the docket, the court has determined that the follow: ing procedural and historic facts are not in dispute.

The Debtors retained Mr. Holmes to represent them in connection with their chapter 13 .case. With the assistance of counsel, they filed their chapter 13 petition on June 15, 2013, together with a proposed plan, which they amended twice before the final confirmation hearing (the “Plan,” EOF Nos. 3, 16 & 22). The court confirmed the Plan on August 14, 2013, approving Mr. Holmes’s initial “no-look” fee for services rendered through confirmation in the amount of $3,000.00. Cf. Memorandum Regarding Allowance of Compensation and Reimbursement of Expenses for Court-Appointed Professionals (as amended effective Oct. 1, 2013) at ¶ 16 (Exhibit 5 to the Local Bankruptcy Rules for the Western District of Michigan, hereinafter the “Fee Memorandum”).

From the record it appears that the Debtors performed their obligations under the Plan largely, though not entirely, without controversy. On September 2, 2016, chapter 13 trustee Brett N. Rodgers (the “Trustee”) filed the Trustee’s Report of Plan Completion (the “Trustee’s Report”). The Trustee’s Report prompted Mr. Holmes to file the Fee Application — his first (and' final) itemization of fees, and expenses — on September 12, 2016 — seeking approval of additional fees in the amount of $2,369.95. Ten days later the [730]*730court entered the Order of Discharge (the “Discharge,” EOF No. 75), absolving both Debtors from “all debts provided for by” the Plan, with specific exceptions as noted in § 1328(a). Evidently anticipating that the Trustee would not be making additional payments, the prayer for relief at the conclusion of the Fee Application requested an order authorizing payment of fees “from the Bankruptcy Estate or to the extent that Funds are not available from the Bankruptcy estate from the Debtor directly.” See Fee Application at p. 2.

The timing of the Fee Application, and counsel’s request to authorize payment from the Debtors directly, caught the court’s attention, prompting it to set a hearing. The court has carefully reviewed the itemization included with the Fee Application and has no reason to quibble with Mr. Holmes’s hourly rates, or the amount of time he spent serving his clients in connection with their chapter 13 case. Both seem reasonable, considering the “relevant factors” enumerated in § 330(a)(3), which the court typically applies regardless of whether it considers fees for representing debtors under §§ 329 or 330. In re Acevedo, Slip Op. Case No. DG 12-06576, 2015 WL 3373030 (Bankr. W.D. Mich. Jan. 26, 2015) (declining to decide whether standards under § 329 or § 330(a) are identical).1 The itemization includes numerous entries for which Mr. Holmes does not seek payment (mostly involving telephone calls from his clients and even for traveling to and from court), and Mr. Holmes does not seek recompense for preparing the Fee Application, though many practitioners routinely request payment for doing so or as the statute contemplates. See Fee Memorandum at ¶ ll(reasonable time for preparing and reviewing application “may be compensable”); 11 U.S.C. § 330(a)(6) (compensation awarded for preparing a fee application must be reasonable). The time entries seem perfectly measured and appropriate. Under the circumstances, the fees of Mr. Holmes are eminently reasonable, and certainly not excessive. 11 U.S.C. § 329(b).

At the hearing, the court inquired whether the unpaid fees were discharged pursuant to § 1328(a), as the Honorable John T. Gregg recently held on similar facts in In re Cripps, 549 B.R. 836 (Bankr. W.D. Mich. 2016). Mr. Holmes acknowledged this authority, but responded with a thoughtful argument based on the fact that (i) the court has not yet approved his fee claim; and (ii) it is too late to pay it as an administrative expense. Therefore, as the argument goes, the court should not regard his claim as an approved administrative expense “provided for” by the Plan. See Tr. at 2:24 through 3:20. In other words, because the unblessed fee claim is not “provided for” by the Plan, it is not included among the debts subject to the Discharge under § 1328(a). This textual argument may find support in the language of the Plan, specifically with respect to the treatment of attorney fee claims,2 [731]*731but it is not without substantial counterpoints, including Cripps, supra, among other authorities.3

Ultimately, resolution of the issue is a matter of interpreting the plan. Wolff v. Johnson (In re Johnson), 344 B.R. 104, 107-08 (9th Cir. BAP 2006) (chapter 13 plan may provide for direct payment of chapter 13 counsel fees by debtor). The court, however, is unwilling to decide at the present time whether counsel’s fees are subject to the Discharge, or not, because Mr. Holmes indicated that his clients are willing to pay him directly. As the Discharge itself notes, nothing in the Bankruptcy Code precludes a debtor from voluntarily paying a discharged debt. See Discharge at p. 2 (citing 11 U.S.C. § 524(f)). If, as Mr.

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Related

In Re Hanson
223 B.R. 775 (D. Oregon, 1998)
In Re Anderson
253 B.R. 14 (E.D. Michigan, 2000)
Wolff v. Johnson (In re Johnson)
344 B.R. 104 (Ninth Circuit, 2006)
In re Cripps
549 B.R. 836 (W.D. Michigan, 2016)
In re Hirsch
550 B.R. 126 (W.D. Michigan, 2016)
In re Conner
559 B.R. 526 (D. New Mexico, 2016)

Cite This Page — Counsel Stack

Bluebook (online)
560 B.R. 728, 2016 Bankr. LEXIS 4128, 2016 WL 6884305, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-long-miwb-2016.