Comments from Aki Koyama on Attorneys Fees in Chapter 13

ATTORNEY FEES

This is the final part of this series. I wanted to cover this section last because we are dealing with substantial form and procedural changes.

As an initial matter, the LBR has only been changed to make clear that if a RARA has been filed, it can be withdrawn with the written consent of your client. The ability to withdraw a RARA, once a RARA was filed in the case, was unclear in the prior language. As there is currently no official form for withdrawal of a RARA, you will have to draft your own pleading. See LBR 3015-1(v)(5).

As most of you are aware, most of the changes have come with the revised RARA and new supplemental fee application forms for post confirmation work and a new fee application for when the case has been dismissed or converted. Both of the new forms are limited to cases where a RARA has been filed.

The links for these forms are as follows:

RARA
http://www.cacb.uscourts.gov/…/rights-and-responsibilities-…;

SUPPLEMENTAL FEE APPLICATION WHEN RARA FILED
http://www.cacb.uscourts.gov/…/application-attorney-debtor-…;

SUPPLEMENTAL FEE ORDER WHEN RARA FILED
http://www.cacb.uscourts.gov/…/order-application-additional…;

FEE APPLICATION WHEN CASE DISMISSED AND RARA FILED
http://www.cacb.uscourts.gov/…/application-attorney-debtor-…;

FEE ORDER WHEN CASE DISMISSED AND RARA FILED
http://www.cacb.uscourts.gov/…/order-application-attorney-d….

All of the foregoing forms are mandatory and are required to be used when an attorney is seeking additional fees when a RARA is in effect. Both fee applications require the consent and signature of your client(s) and if a client’s consent and signature cannot be obtained, an explanation as to why the attorney could not obtain the the client’s consent and signature.

Some questions that I have been asked about the new forms:

1. If I don’t file a RARA, do I have to use these forms?

No. The caption of the form appears to limit the forms for when a RARA has been filed in the case. If you don’t file a RARA, you will have to submit a detailed fee application as usual. Your fee application entries will be subject to Trustee Objection and/or disapproval by the court as always. Your fee application will most likely be subject to the usual loadstar analysis.

2. If I ask for the flat fee for a supplemental service, do I have to get my client’s consent and signature?

Yes, if you can but if you cannot, you probably have a strong argument for why the flat fee should be allowed anyway so long as the service benefited the debtor and/or the estate. The supplemental flat fee is a “no look” fee just like the RARA. The final resolution of this issue may vary from judge to judge and trustee to trustee.

3. What will happen if my client’s case is dismissed or converted and I have lost contact with my client or my client refuses to consent to my fees?

I am making a reasonable projection here but most likely, the court will look at the reason why you cannot get your client to consent and sign the application, review the services provided and set the matter for hearing if the court deems it necessary. This will vary from judge to judge so please share your knowledge of any “local local” rules with the bar.

4. Do I need to include a notice of the fee application if my client has consented and signed the fee application?

Yes. LBR 3015-1(w)(1)(D) still applies and adequate notice must be provided. Please use the following court form for this notice as follows:

http://www.cacb.uscourts.gov/…/F9013-1.2OPPORTUNITYHEARINGN…

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