280 F. 127 | D. Wyo. | 1922
The above-entitled cause is before the court at this time upon the certificate of the referee in connection with an attorney’s fee to be allowed the attorney for the bankrupt in said matter. It may be said in passing that under a special order of the District Court in this district all claims for attorney’s fees must be presented to and allowed by the District Judge.
The certificate of the referee and the record in the case disclose the following facts: Schedule B (4) annexed to the voluntary petition recites, in the place designated for including sums paid to counsel for services rendered or to be rendered in the bankruptcy cause, that the attorney for the' bankrupt had been paid the sum of $395 in cash and $200 by virtue of an assignment of an account due and owing to the bankrupt, which was assigned November 7, 1921. The petition in bankruptcy, together with the schedules, appears to have been filed in the office of the clerk on November 7, 1921. On November 25, 1921, after the proceeding had reached the referee in bankruptcy under the
The referee’s certificate discloses that on February 5, 1922, the attorney for the bankrupt filed his answer to said motion, in which said attorney seeks to justify the amount received in advance for his services performed and to be performed in said proceeding. Said answer is submitted to the court in connection with the referee’s certificate. It further appears that on April 24, 1922, the said bankrupt’s attorney filed a plea in abatement to the motion aforesaid, by which plea said attorney claims that the time is not opportune for disposing of the matter of attorney’s fees, in that it is impossible at the time of the consideration of the motion to determine with any degree of accuracy what services it will be necessary to perform as attorney for the bankrupt in the proceeding. To this plea is attached a statement purporting to set forth the items of service performed by the attorney, aggregating $850.
The referee’s certificate further discloses that the sum marshaled by the trustee in the bankrupt estate is $6,287.13, and that the estimated aggregate expense of administering the estate will amount to $2,220, that a dividend of 7 per cent, has already been paid the general creditors, and that it is estimated there will be an additional dividend of approximately 8 per cent, to these creditors. Under the rule before suggested as to the allowance of all counsel fees by the judge, the referee has certified the matter here.
As to the rule governing the class and kind of services to be performed which may be included in the claim of the bankrupt’s attorney and allowed by the court, it may be said that courts have not been in complete harmony. Collier, one of the leading authorities on bankruptcy law, lays down the rule as follows:
“The safer rule is that the bankrupt's attorney is only entitled to compensation out of the estate for services which, although performed for the bankrupt, are really in aid of the estate and its administration.”
This view is supported by In re Brundin et al. (C. C.) 112 Fed. 306, which case also cites In re Mayer (D. C.) 101 Fed. 695, and may be taken, therefore, as fairly expressing the views of this court upon that phase of the subject.
“Economy in the administration of estates is the policy of the present law and is to be strictly enforced. This principle should be kept in mind in fixing compensation of attorneys.”
In support of this rule the author cites In re Frank Meis, 18 Am. Bankr. R. 104. This rule is.discussed in the following language, as found in the case of In re Curtis et al., 100 Fed. 784, at page 792, 41 C. C. A. 59, at page 68, a decision by the Circuit Court of Appeals of the Seventh Circuit, as follows:
“The policy of the present Bankruptcy Act, in contrast with the provisions of the previous law, discloses clearly the design of Congress that the administration of bankrupt estates should be had at the minimum of expense. Under the former law much scandal had arisen because of the large cost of administering estates. The present act, so far as it specifies the amount of fees of officers whose services may be required in execution of the law, fixes them at a low figure, possibly much lower than is compensation for the service; but it is not for us, for that reason, to disregard the law, or seek to thwart the design of Congress, however inadequate we may think the compensation allowed. This thought is well expressed by the court below in the opinion filed. It is there said: ‘The present Bankruptcy Law was evidently intended to reduce to the lowest minimum the costs of administration, as regards fees of officers created by the act, as well as those of attorneys who may be called to assist the court in the preservation and distribution of the bankrupt estate.’ ”
This brings up the question as to whether employment at the same time in one proceeding by the same attorney as an attorney for the
The item included in making trip from Torrington to Cheyenne in the interest of the general creditors to have a receiver appointed also comes within the same class, and therefore cannot be considered in passing upon this claim. •
“Legal services to a bankrupt in having his exemptions allowed is a matter between the bankrupt and his attorneys and are not allowable.”
The order of the court will therefore be that the trustee make proper demand of the said attorney for the return of the amount received in excess of the amount herein allowed, and.pursue such remedies in securing the return of that portion of the estate into his hands as trustee as he may be advised.
If the attorney may desire to file with the referee a claim for his services performed on behalf of the receiver, that matter will be taken up and passed upon in its proper order and place.