101 F. 695 | E.D. Wis. | 1900
This inquiry, which calls for an interpretation of the act in reference to allowances for attorney fees, is of special importance in its bearings upon other cases in this district, and I have given careful consideration to the matters submitted by the referee. The following conclusions are certified thereupon:
1. The bankrupt is in contempt, and clearly cannot move the court for any matter of indulgence until he has cleared his contempt. Hovey v. Elliott, 167 U. S. 409, 436, 17 Sup. Ct. 841, 42 L. Ed. 215.
■ 2. The question of the extent of services for which such allowance is contemplated by the statute arises out of the provision in section 64b, under the head of “Debts Which Have Priority,” that “costs of administration shall be paid,” including “one reasonable attorney’s fee for the professional services actually rendered, irrespective of the number of attorneys employed, * * * to the bankrupt in involuntary cases while performing the duties herein prescribed.” The guarded language of this allowance and of the cognate provisions must be interpreted in the light of the intent manifested throughout the act to secure rigid economy in administering the estate in bankruptcy, and save to the creditors, a considerable portion which was otherwise liable to be swallowed up in expenses, — a feature in which the former acts were found defective. The claimants urge that the grant of attorney’s fees out of the estate is exclusively for the benefit and protection of the bankrupt, without regard to any benefit to the creditors; that it is made a matter of right, founded on the presumption of his surrender of all his possessions as demanded by the act, and on the equity of having any necessary services of an attorney in the course of the proceedings borne by the estate thus surrendered. If such interpretation is adopted, it would seem that no inquiry need be made in this case beyond that of the reasonableness of the claims presented, all being charged for one attorney. Both the fact and the need of able counsel to defend the bankrupt on serious charges of fraudulent conduct and concealment of property appear in this record and have otherwise come to the knowledge of the court. Even the disclosure in such proceedings of property, largely in excess of the claims in question, withheld and concealed by the bankrupt, and under his control, cannot,serve to defeat the allowance, if it rests on- statutory right and not in judicial discretion, aside from the measure of allowance.
I am of opinion, however, that the terms of the provision for the services of an attorney “to the bankrupt in involuntary cases while performing the duties herein prescribed” are thus limited in strict accord with the general tenor and spirit of the enactment, and neither express nor intend an allowance for the defense" of the bankrupt through the course of the proceedings in matters involving his personal liability, civil or criminal. The duties to be performed by the bankrupt in the proceedings are prescribed in section 7, and all relate to attendance and services of presumptive benefit to the estate, with the possible exception of attending at “the hearing upon his applica
d. The inquiry as to the amount to be allowed for items of service so approved cannot be definitely answered, for want of specific information of the extent and circumstances of the service; but the ■statement of a general rule for' measuring the allowance will serve for an adjustment by the referee. (1) It is certified by the referee that his customary allowance for service in drafting schedules is from $25 to $50, according to the extent. This work is mainly clerical, and the practice in that regard is approved. (2) As indicated above, I am of opinion that the bankrupt is entitled to counsel while undergoing his examination before the referee in respect of his affairs and conduct. Ordinarily this should not require attendance on more than -one or two days. If extended, however, a.t the instance of the creditors or trustee, without delay needlessly caused by the conduct of the bankrupt in the examination, the time so occupied must be computed in making the allowance. The examinations should be conducted with reasonable dispatch, and without unnecessary adjournments; and if, in any case, there is procrastination or prolixity on