Oakhurst Lodge, Inc., a California Corporation, 11-17165

Background

Oakhurst Lodge, Inc. filed Chapter 11 in 2011 and confirmed a plan in 2012 that preserved stay/discharge/revesting protections and provided creditor payments from motel operations.
First-Citizens Bank foreclosed in late 2012; Oakhurst sued for stay violations and ultimately settled in 2018 for $3,000,000.
The court approved the settlement and directed settlement proceeds into a blocked account to be disbursed consistent with the confirmed plan; distributions require noticed motions with admissible evidence.
Elvin Bell, a marketing/litigation consultant, sought $176,800 for post-confirmation services; Oakhurst supports the request, certain shareholders (the Patels) oppose.
The court found Bell’s submissions lacked declarations under penalty of perjury and failed to establish contract terms, adequate documentation of work, or the reasonable benefit required to award damages; the motion was denied without prejudice.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Is Oakhurst bound to a contract with Bell (agency)?	Bell: Marshall/Oakhurst designated Bell in a March 25, 2014 letter, creating agency and principal liability.	Patels: Any contract was with Marshall personally, not Oakhurst.	Court: March 25, 2014 letter minimally shows a disclosed principal for services on/after that date, so Oakhurst may be bound for those services.
Are the contract terms definite enough to enforce payment?	Bell: Had flat-fee and later hourly arrangements (claimed at hearing).	Patels: No written terms; agreement is vague and unenforceable.	Court: Bell failed to present contract terms with requisite certainty; cannot determine enforceable obligations.
Has Bell adequately documented services and resulting benefit to the corporation?	Bell: Submitted declarations and invoices (but many unsworn); contends work over six years justified $176,800.	Patels: Work was after foreclosure and did not reasonably benefit debtor; documentation is fragmented and unsworn.	Court: Evidence insufficient — unsworn materials not considered and sworn declaration lacked necessary detail; no prima facie showing of entitlement.
May the court review and deny post-confirmation fee claims?	Bell: Implicitly argues fees should be paid under Settlement Order.	Patels: Court retains discretion and must enforce evidentiary requirements under the Settlement Order and bankruptcy law.	Court: Has authority (including under §329(b) and the Settlement Order) to review post-confirmation fees; applied evidentiary standards and denied Bell's motion without prejudice.

Key Cases Cited

Hillis Motors, Inc. v. Hawaii Auto. Dealers’ Ass’n, 997 F.2d 581 (9th Cir. 1993) (confirmed-plan stay/discharge/revesting principles)
In re Sundquist, 576 B.R. 858 (Bankr. E.D. Cal. 2017) (bankruptcy court may review professional fees after case conclusion)
Holmes v. Lener, 74 Cal. App. 4th 442 (Cal. Ct. App. 1999) (contract terms must be definite and reasonably certain to be enforceable)