Court Opinion

ID: 9701830
Source: CourtListenerOpinion
Date Created: 2023-08-25 22:39:56.336719+00
Date Added: 2024-06-11T18:21:30.033939
License: Public Domain

RYAN, Bankruptcy Judge, concurring.
While I agree with the outcome of the opinion, I write separately because I believe the Ch. 13 Payment Guidelines (the *406“Guidelines”) are self-defeating, ambiguous, and need modification.
It appears that, under the current practice in the Northern District of California, the Guidelines are not binding on the attorneys. In other words, an attorney can opt for the “no look” fees, get paid the fees, and later seek a full § 330 review on application should the attorney believe that additional fees are warranted on the very same services that he sought and received payment for under the Guidelines.19
The Guidelines are designed to provide an efficient method for disbursing fees to chapter 13 attorneys without further detailed fee application or hearing. Various courts have approved fixed fees for certain categories of services. See, e.g., In re Finlasen, 250 B.R. 446, 449 (Bankr. S.D.Fla.2000) (referring to Local Rule 2016-1(B)(2) and the “Chapter 13 Fee Guidelines”); In re Pedersen, 229 B.R. 445 (Bankr.E.D.Ca!.1999). Ideally, the system advances the interest of judicial economy by avoiding a detailed review of fee applications under § 330. This purpose, however, is not achieved if the attorneys are allowed to later request a § 330 review after opting for the fixed fees. Such a system is self-defeating because there is no real choice being made. Attorneys will likely first choose to accept the “no look” fees and later file a fee application if dissatisfied with the fixed fees previously received.
Here, the Guidelines allow “maximum initial fees” of $1,400 for basic services. However, the Guidelines do not indicate what tasks are to be covered under the basic services. The same problem exists in determining whether fixed fees are appropriate in the other categories. The Guidelines do not prevent attorneys from seeking a later § 330 review to obtain additional fees even though the attorney has been previously paid under the Guidelines. In any event, this appears to be the practice. Arguably, the Guidelines are ambiguous on this point: “If counsel elects to be paid other than pursuant to these Guidelines, all fees including the retainer shall be approved by the court .... ” Guidelines for Payments of Attorney Fee in Chapter 13 Cases, at 2.
Therefore, given the ambiguity and lack of specificity of the Guidelines, I would defer to the court’s § 330 review, which is given great deference. See Gill v. Wittenburg (In re Fin. Corp. of America), 114 B.R. 221, 224 (9th Cir. BAP 1990). Here, the bankruptcy court divided the work performed by Boone into two categories: basic services and real property claims.20 Boone also requested $125 for the preparation of the fee application. Finding that the $1,400 provided under the Guidelines was sufficient to cover the basic services, the court declined to award Boone any *407additional fees in this category. However, the court awarded the $1,219 without “second guessing” the time invested by Boone in the stay motions. Apparently, the court also awarded the $125 to Boone for filing the fee application. Although the court did not make detailed findings regarding its fee awards under § 330, I agree with the majority that the court satisfied § 330 and would affirm the bankruptcy court.
The majority cited numerous cases to support the position that the court can conduct a § 330 review after a chapter 13 attorney has opted for the “no look” fees. However, those cases do not support the application of the Guidelines as understood by Boone and Judge Grube.
For example, in In re Argento, 282 B.R. 108 (Bankr.D.Mass.2002), the attorney filed a fee application for $12,837.50. In the application, the attorney disclosed that $1,500 was paid prepetition as a retainer. The Argento court allowed the $1,500 because the attorney intended it to cover the routine services. Id. at 117. As to the remaining requested fees, the Argento court held that the attorney performed services “that clearly went beyond the routine and were of benefit to his clients.” Id. Therefore, the Argento court reviewed the remaining fees under the lodestar approach. Because the attorney in Argento did not opt for “no look” fees, Argento is distinguishable.
Similarly, In re Szymczak, 246 B.R. 774 (Bankr.D.N.J.2000), involved a different factual scenario. There, the attorney filed a fee application seeking an allowance of fees in the amount of $9,691.25.21 The court issued an order awarding only $2,250. The attorney filed a reconsideration motion, which was granted by the court. It subsequently revised the allowance of fees to $3,350. Specifically, the Szymczak court awarded the $1,500 for normal and customary chapter 13 services, and applied the lodestar analysis to extraordinary work performed. Id. at 781-82. Therefore, like Argento, Szymczak is distinguishable because it did not involve a situation where the attorney opted for “no-look” fees and later sought additional fees under § 330.
Finally, in In re Watkins, 189 B.R. 823 (Bankr.N.D.Ala.1995), the second attorney filed a fee application for additional fees after the debtor’s chapter 13 case was reinstated.22 In determining whether the new attorney was entitled to additional fees, the Watkins court first applied the normal and customary standard. Id. at 832. Finding that the attorney’s late retention in the case resulted in extraordinary work, the Watkins court applied the lodestar analysis and granted the requested fees in part. Id. at 835. Again, Watkins is distinguishable because it did not involve an attorney who opted for “no look” fees and later sought a § 330 review.
In sum, I believe the Guidelines should be modified for the reasons previously mentioned. To achieve the objective of judicial economy and to follow the application of “no-look” fees as approved in other cases, attorneys should be required to decide to accept either the fixed fees under the Guidelines or file a fee application *408subject to a § 330 review. Attorneys who opt for “no look” fees should not be entitled to additional fees for the same services that are covered by, awarded under, and paid pursuant to the Guidelines. This certainly does not prevent attorneys from obtaining additional fees for services beyond the scope of the basic services covered by the “no-look” provisions of the Guidelines. However, in order for attorneys to make an informed decision whether to accept the “no-look” fees, the Guidelines should clearly describe the tasks covered in those categories of services applicable for a fixed fee.

. This was explained to us by Boone during oral argument. This is apparently understood to be the practice because Judge Grube reviewed all the services performed by Boone under § 330. Boone explained that he wanted clarification regarding the practice because he did not believe that Judge Grube properly complied with § 330 as to all the services that he performed. He also explained that he has a number of pending applications for fees presenting the very same issue regarding the application of the Guidelines and the adequacy of the § 330 review.

. Boone requested $2,254 for basic services, which include "compensation for initial meeting with Debtors and preparing petition, schedules, matrix and Chapter 13 Plan.” Chapter 13 Application for Compensation (Feb. 27, 2002), at 2. Further, Boone represented Debtors in two separate motions for relief from stay and requested $1,129 for services related to the real property claims.

. The local bankruptcy rules for the District of New Jersey requires an attorney to file a detailed fee application for review if the attorney’s fee request exceeded $1,500. See Szymczak, 246 B.R. at 777 n. 1.

. In Watkins, the debtors were represented by another attorney when their case was initially filed. The debtors' case was dismissed because they failed to make their monthly plan payments. Prior to the dismissal, the bankruptcy court awarded $550 to the first attorney. Of that amount, $488.12 was paid to the new attorney after the case was reinstated. See Watkins, 189 B.R. at 826.