BANKRUPTCY RULE 2016-1

COMPENSATION FOR LEGAL FEES AND EXPENSES

SOUGHT BY DEBTOR'S ATTORNEY IN CHAPTER 13 CASES

 

(A)    Legal Fees and Expenses - Without Application to the Court

The attorney for a debtor, whether joint or individual, in a Chapter 13 case is excused from the compensation application requirements of Fed. R. Bankr. P. 2016(a) and the notice requirement of Fed. R. Bankr. P. 2002(a)(6) if the attorney's claim for compensation does not exceed a presumptively reasonable fee of $3,000.00 for below-median cases and $3,500.00 for above-median cases and actual costs and expenses do not exceed $150.00 (excluding the filing fee). This fee shall be presumed to compensate a debtor's attorney for a level of service to the debtor that, at a minimum, shall include the services listed in paragraph (1) and the costs listed in paragraph (3) below.

If the attorney elects to accept the presumptively reasonable fee for the services listed below, he or she must clearly specify such election in the Chapter 13 plan.

If the attorney's claim for compensation falls within the scope of this rule, and the court neither receives objections nor raises concerns regarding the compensation and expenses included in the Disclosure of Compensation of Attorney for Debtor or the proposed Chapter 13 plan, the amount of fees and expenses listed in the plan shall be deemed approved under § 330 and allowed as an administrative expense under § 503(b)(2) upon confirmation of the plan.

This rule does not limit the trustee, United States Trustee, creditors or any interested party from questioning the reasonableness of an attorney's fees or expenses. This rule also does not limit the court's discretion to review the amount of fees paid to or agreed to be paid to a debtor's attorney or to enter appropriate orders allowing, disallowing or reducing attorney's fees or expenses. If an objection is raised, the attorney may be required to submit an application for compensation and an itemization of fees and costs that satisfy the requirements of § 330 and Fed. R. Bankr. P. 2016.

(1)           The presumptively reasonable fee shall include, at a minimum, the following services:

(a)            Prepetition

1.                Meeting with the debtor to discuss and analyze the debtor's situation, goals and objectives and to recommend a solution.

2.                Counseling the debtor regarding the advisability of filing bankruptcy (as well as non-bankruptcy options) and answering the debtor's questions.

3.                Explaining the terms of representation, filing fees and plan payment requirements.

4.                Performing due diligence tasks such as obtaining the debtor's  credit report, checking the national PACER database to confirm whether the debtor has previously filed a bankruptcy case and verifying ownership of vehicles, real property and other assets.

5.                Consulting and communicating with the debtor to gather information and inform the debtor of his/her responsibilities.

6.                Timely preparing, revising and finalizing the debtor's petition, plan, statements, schedules and other forms and documents necessary for prosecuting the debtor’s bankruptcy case.

7.                Advising the debtor of the requirements to obtain prepetition credit counseling, to maintain appropriate insurance and to file all appropriate income and other tax returns.  Advising the debtor about the steps necessary to obtain a discharge including filing a statement regarding domestic support obligations and completing a financial management course.

8.                Reviewing the completed petition, plan, statements and schedules with the debtor and ensuring the debtor signs them.

(b)            Postpetition and Preconfirmation

1.                Advising the debtor of the requirement to attend the meeting of creditors, ensuring the debtor is prepared for the meeting and notifying the debtor of the date, time and place of the meeting. In the case of a joint filing, notifying both spouses that both must appear at the meeting.

2.                Providing legal representation to the debtor at the meeting of creditors and attending the confirmation hearing if necessary.

3.                Ensuring bank statements and income and tax records are timely submitted to the trustee.

4.                Initiating and responding to correspondence and calls to and from the trustee, the United States Trustee, creditors and other interested parties as necessary for the timely administration of the debtor's case.

5.                Timely responding to objections to plan confirmation and, where necessary, preparing, filing and serving an amended plan.

6.                Corresponding with the debtor and creditors to ensure compliance with § 362 (automatic stay) as it pertains to wage garnishments, levied accounts, foreclosures or any other matter.

7.                Monitoring all incoming Case Management/Electronic Case Files (CM/ECF) case information.

8.                Timely preparing, filing and serving any necessary amended statements and schedules and any change of address in accordance with information provided by the debtor.

9.                Assisting the debtor in responding to requests for information made in connection with an audit conducted pursuant to 28 U.S.C. § 586(f).

10.           Assisting the debtor in complying with § 521(f)(4) (debtor's duties).

(c)            Postconfirmation

1.                Evaluating proofs of claim, determining the necessity of objecting to filed claims and advising the debtor accordingly.

2.                Responding to the debtor's questions throughout the term of the plan or until either the case is dismissed or the court has authorized the debtor's attorney to withdraw from representation.

3.                Assisting the debtor with the steps necessary to obtain a discharge including filing a statement regarding domestic support obligations and completing a financial management course.

4.                Monitoring all incoming CM/ECF case information.

(2)           The presumptively reasonable fee shall not include the following services:

(a)            Representing the debtor in adversary matters, Rule 2004 examinations or postconfirmation hearings.

(b)            Preparing the following motions:

1.                to buy or sell real or personal property and/or to incur debt;

2.                objecting to improper or invalid proofs of claim;

3.                to avoid a lien;

4.                to modify the Chapter 13 plan;

5.                to approve settlements;

6.                to deem a mortgage current;

7.                to approve sales or refinancing;

8.                to substitute collateral;

9.                for hardship discharge; and

10.           for early termination of the plan.

(c)            Responding to motions:

1.                for relief from stay or for a valuation of property; and

2.                to dismiss (postconfirmation).

(3)           The costs and expenses included in the presumptively reasonable sum of $150.00 include: photocopies, PACER fees, postage, long distance telephone charges, due diligence fees, credit counseling costs and mileage.  An attorney is entitled to seek reimbursement of filing fees if paid by the attorney, in addition to the $150.00 in costs and expenses listed above, without filing a separate application to the court.

(B)     COMPENSATION AND EXPENSES - APPLICATION REQUIRED

Employing the fee application waiver process described in subsection (A) is optional.  For those attorneys who do not wish to accept the presumptively reasonable fee for the minimum services listed, they may submit applications that conform to the requirements in § 330 and Fed. R. Bankr. P. 2016(a) and 2002(a)(6).

An attorney who elects to accept the presumptively reasonable fee for the tasks and expenses listed in subsections (A)(1) and (A)(3) may apply for additional compensation for tasks which exceed the scope of those subsections. This application must conform to the requirements in § 330 and Fed. R. Bankr. P. 2016(a) and 2002(a)(6). The application for additional compensation for tasks or expenses exceeding the scope need not include an itemization of tasks or fees that fall within the presumptively reasonable fee under subsections (A)(1) and (A)(3), unless specifically requested by the court.