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Vol 14, Num 3 l August 2016

Ethics and Professional Compensation

► In This Issue:

Ninth Circuit Bankruptcy Appellate Panel Holds that Trustee Can Liquidate Debtor’s Pre-Paid Advance Fee Retainer by Rejecting Agreement and Terminating Legal Services


Keith L. Kleinman
Cozen O’Connor
Wilmington, Del.

A critical issue for all attorneys who represent debtors in bankruptcy is how to ensure payment for services performed both prior to and after a bankruptcy filing. One way that attorneys seek to secure payment for post-petition services is by obtaining an “advance fee retainer” that is earned in full upon receipt and thus arguably never becomes property of the debtor’s estate and can be used to fund post-petition services.
» Read More

Can This Possibly Be Ethical or Permissible?


Jennifer Larkin Kneeland
Linowes and Blocher LLP
Bethesda, Md.

On May 18, 2016, the U.S. Bankruptcy Court for the Northern District of Texas issued a 51-page opinion resolving its Order Setting Show Cause Hearing (the “show cause order”) in the chapter 13 case of Netoche Brigham Fair (the debtor, or “Ms. Fair”). In this remarkable opinion, the bankruptcy court rendered a decision about the propriety (or lack thereof) of debtor’s counsel’s practice of (1) using clients’ debit card accounts for the purpose of making chapter 13 plan payments and (2) payment of counsel’s fees by a local car dealer, New Start Auto, with whom counsel had established a referral arrangement. The opinion is directed toward both Ms. Fair’s counsel, as well as the law firm that her counsel shared with another practitioner. Ms. Fair’s counsel and the law firm are referenced in this article as “debtor’s counsel” or “counsel.”
 » Read More

No Surprise: A Court Can and WILL Significantly Reduce “Exaggerated” and “Overstated” Attorneys’ Fees


John F. Theil
Stuart Maue
St. Louis, MO

On March 25, 2015, the U.S. Bankruptcy Court for the Southern District of Florida entered an order to reduce a chapter 13 debtor’s attorney’s fee application by more than 70 percent. The order provides a detailed analysis of the Court’s review of the limited case law on fee awards in Chapter 13 cases, as well as an in depth explanation by the Court of the basis for the fee reduction and ultimate award in the case before it. The Order also contains strong words for the fee applicant regarding his application and billing practices.
 » Read More

Summer Conferences Provide Ethics Session Materials

This summer's conferences have provided attendees with a variety of ethics related sessions. All materials are available to ABI members, regardless of attendance. Review the selected materials sets below, and visit our materials page for a full listing!

Winter Leadership Conference


24th Annual Southwest Bankruptcy Conference

66 Canal Center Plaza, Suite 600, Alexandria, VA 22314 |
Tel. (703)-739-0800
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