Rule 2016-3 : Compensation of Chapter 13 Debtor's Counsel


(a) Short Form Fee Application:

(1) Eligibility: In order to be eligible to use the Short Form Fee Application (the “SFFA”) procedure, the applicant must request a fee that is at or below the presumptively reasonable fee (the “PRF”) amount provided in the General Procedure Order published by the Clerk, In the Matter of Procedures for Fee Applications in Chapter 13 Cases, as amended from time to time. The applicant must provide all reasonably necessary and appropriate services during the pendency of the entire case.

(2) Presumptively Reasonable Fee: The chapter 13 trustee may recommend or the court may determine, in appropriate cases, that a lower fee be allowed. In converted cases, the chapter 13 trustee and the court will take into consideration the compensation already received.

(3) Form of Application: Applications for allowance of fees and reimbursement of expenses pursuant to the SFFA procedure must be made using L.B. Form 2016-3.1. Applicant need not supplement L.B. Form 2016-3.1, except upon formal objection, written request of the chapter 13 trustee, or order by the court.

(4) Service, Notice and Objections: Debtor’s counsel must serve a copy of the SFFA, L.B. Form 2016-3.1, along with a notice in substantial conformity with L.B. Form 2016-3.3, on the chapter 13 trustee, debtor and those parties requesting notice. Parties will have twenty-one (21) days from the mailing of the notice within which to file an objection.

(5) Timing: Fee applications under the SFFA must be filed no sooner than the date of entry of the order confirming the chapter 13 plan and no later than twenty eight (28) days after the date of entry of the order confirming the chapter 13 plan.

(6) Order: The attorney must submit a form of order in substantial conformity with L.B. Form 2016-3.4, listing the specific amount of fees and expenses requested, the amount received outside of the plan or previously paid, and the amount payable from plan payments.

(b) Long Form Fee Application:

(1) Eligibility: If the applicant requests allowance of a fee in excess of the PRF amount (not including expenses), the attorney may not use the SFFA procedure and must use the Long Form Fee Application (the “LFFA”) procedure. The applicant must provide all reasonably necessary and appropriate services during the pendency of the entire case.

(2) Form of Applications: Applications for allowance of fees and reimbursement of expenses pursuant to the LFFA procedure must be made using L.B. Form 2016-3.2, and must be supplemented by the attachments outlined in L.B. Form 2016-3.2.

(3) Service, Notice and Objections: Debtor’s counsel must serve a copy of the LFFA, L.B. Form 2016-3.2, along with a notice in substantial conformity with L.B. Form 2016-3.3, on the chapter 13 trustee, the debtor and those parties requesting notice. The notice, without the LFFA form, must be served on all other creditors, claimants and parties in interest. Parties will have twenty-one (21) days from the mailing of the notice within which to file an objection.

(4) Timing: Fee applications under the LFFA must be filed no sooner than the date of entry of the order confirming the chapter 13 plan and no later than twenty eight (28) days after the date of entry of the order confirming the chapter 13 plan.

(5) Order: The attorney must submit a form of order in substantial conformity with L.B. Form 2016-3.4, listing the specific amount of fees and expenses requested, the amount received outside of the plan or previously paid, and the amount payable from plan payments.

(c) Supplemental Form Fee Application:

(1) Eligibility: If the applicant provides services post-confirmation and requests allowance of a supplemental fee for post-confirmation services, the applicant must use the Supplemental Form Fee Application (the “SUPFFA”) procedure.

(2) Form of Applications: Applications for allowance of fees and reimbursement of expenses pursuant to the SUPFFA procedure must be made using L.B. Form 2016-3.5, and must be supplemented by the attachments outlined in L.B. Form 2016-3.5.

(3) Service, Notice and Objections: Debtor’s counsel must serve a copy of the SUPFFA, L.B. Form 2016-3.5, along with a notice in substantial conformity with L.B. Form 2016-3.3, on the chapter 13 trustee, the debtor and those parties requesting notice. The notice, without the SUPFFA form, must be served on all other creditors, claimants and parties in interest. Parties will have twenty-one (21) days from the mailing of the notice within which to file an objection.

(4) Timing: Fee applications under SUPFFA may not be filed until after entry of an order approving an application under either the SFFA procedure or the LFFA procedure, and no later than the date the Chapter 13 Trustee files a final report.

(5) Order: The attorney must submit a form of order in substantial conformity with L.B. Form 2016-3.6, listing the specific amount of post-confirmation fees and expenses requested, the amount previously approved by the court, the received outside of the plan or previously paid, and the amount payable from plan payments.

(d) Hearing: If no objection is filed, the court may allow the requested fee in full or in part, upon the filing of a Certificate of Noncontested Matter in substantial conformity with L.B. Form 9013-1.3, or may order further supplementation or set the application for hearing. Any order or notice setting a hearing on an unopposed application may identify the court’s concerns or questions regarding inadequacies or deficiencies in the application that may result in reduction or disallowance of the requested fees or expenses. If an objection is filed, the applicant is responsible for filing a Certificate of Contested Matter and Request for Hearing in substantial conformity with L.B. Form 9013-1.4. Upon the filing of the Certificate of Contested Matter, the court may set the matter for hearing.

Commentary

[Source - GPO 2007-2, as amended and, as may be amended from time to time]

The SFFA and LFFA procedures establish the time frame within which an applicant must apply initially for approval of Chapter 13 fees and reimbursement of expenses. However, regardless of whether the applicant utilizes the SFFA or LFFA procedures, the prohibitions against and restrictions on limited representation contained in L.B.R. 9010-1 require that the engagement does not terminate at plan confirmation. Rather, representation must last through the earlier of entry of discharge, or the conversion or dismissal of the case unless counsel is permitted to withdraw in accordance with L.B.R. 9010-4.

The SFFA procedure is for requesting fees and is not intended to limit the scope of chapter 13 engagements. When requesting fees using the SFFA procedure, attorneys are not required to submit their engagement letter or other fee agreement, detailed time slips, or a narrative unless requested by the trustee or otherwise ordered by the court. However, attorneys are advised that if their fees are questioned, it may be quite difficult to prevail without the assistance of some or all of those items. Although the SFFA process does not limit the ability of debtor’s attorney to seek additional fees post-confirmation, certain routine post-confirmation services are expected to be rendered by applicant as part of the PRF. For example, in most cases, such routine post-confirmation services will include reviewing claims after the expiration of the claims date; advising on the requirement that the debtor complete a financial management course; communicating with the debtor, creditors and other parties-in-interest concerning the case; defending a motion for relief from stay or motion to dismiss; and, completing the debtor’s certification for discharge. However, generally, prosecuting or defending against a motion for a plan modification would not be considered a routine post- confirmation service.

The LFFA procedure is intended to be a fee-for-service arrangement where it is anticipated that total attorney fees for the case will exceed the PRF amount. The SUPFFA procedure completes payment for post-confirmation services reasonably necessary and appropriate for the engagement. The court will entertain supplemental fee applications that comply with the SUPFFA procedure, supported by time records, for post-confirmation services. Like the LFFA, applications under the SUPFFA must be supplemented by the same attachments.