IMPORTANT - New Rules for Chapter 13 Attorney Fees - effective December 1, 2013

Tuesday, November 26, 2013

 


NOTICE--NEW RULES FOR CHAPTER 13 ATTORNEY FEES EFFECTIVE DECEMBER 1, 2013

Please take notice of revised Appendix N and new Appendix Q to the Local Rules of the United States Bankruptcy Court for the District of Nebraska. Revised Appendix N and  new Appendix Q are located at www.neb.uscourts.gov - Court Info - Local Rules/Appendix and General Orders.  

The revisions materially alter the compensation method for debtor attorneys in Chapter 13 cases.  Under the current system, the attorneys in the majority of cases have been bypassing the full no-look fee or the partial no-look fee with the right to file supplemental fee applications.  As a result, the current system became burdensome for the attorneys as well as the court.  In an effort to ease the burdens and create more efficiency, the court has worked with attorneys, the UST and the Chapter 13 Trustee to create a new No Look Compensation Plan (NLCP) as set forth in revised Appendix N and new Appendix Q.  The Court believes this new system will fairly compensate attorneys while eliminating fee applications (except in unique or unusual circumstances).  

Please carefully review these documents as they are effective December 1st.  Some highlights are as follows:

--The Standard Allowable Amount (SAA) for all services typically performed when representing a chapter 13 debtor shall be no more than $3,700.00, plus expenses of $200.00.  Counsel may always elect a smaller SAA in the plan, but may not elect a greater amount.  

--The new NLCP shall apply to ALL Chapter 13 cases regardless of filing date.  If a plan has been filed but is unconfirmed as of the effective date of December 1, 2013, any request for compensation set forth in such unconfirmed plan shall be deemed automatically converted to the SAA.  See Appendix N, paragraph 5.a.

--Exceptions to the NLCP are set forth in paragraph 4 of revised Appendix N and will be narrowly construed.  In the event counsel believes the case should be an exception to the NLCP, the plan should so state and provide a detailed explanation.

--In addition to the SAA, counsel shall also be entitled to receive A La Carte (ALC) fees in a specified amount for specific additional substantive services that are provided in a particular case.  Counsel will not file supplemental fee applications for such extra services.  Instead, counsel will file a Certification of ALC fees in accordance with Appendix Q.  Please note the instructions and comments to Appendix Q (the last two pages).  Any certification of ALC fees shall be under oath and notarized.  Note the ALC limitations at paragraph 3.d. of Appendix N.

--We recognize this new procedure materially changes past practice and will come with some growing pains and questions.  To the extent you have a question about using the NLCP, please fee free to contact any of the Courtroom Deputies or Eva Roeber, the Chief Deputy.  We will strive to provide a prompt answer.  In the end, the goal is to properly compensate attorneys while alleviating the time, burden and expense of fee applications in Chapter 13 cases.