Matter of Aaron Ferer & Sons Co.
Decision Date | 28 February 1977 |
Docket Number | No. BK. 74-0-482.,BK. 74-0-482. |
Citation | 427 F. Supp. 350 |
Parties | In the Matter of AARON FERER & SONS CO., Debtor. |
Court | U.S. District Court — District of Nebraska |
Robert F. Craig, Omaha, Neb., for appellant Max Schwartzman.
Ray R. Simon, Jerrold L. Strasheim, Omaha, Neb., for defendant.
Max Schwartzman and Sons, Inc., appeals from the memorandum and order of the bankruptcy court dated December 1, 1975, allowing counsel for Aaron Ferer and Sons Company, debtor-in-possession, attorney's fees in the amount of $244,505.00. Appellant argues that the bankruptcy court erred in granting counsel for Aaron Ferer a rehearing on the attorney's fee issue and erred in granting excessive fees to counsel. This Court affirms.
On April 24, 1974, Aaron Ferer filed an original petition for arrangement pursuant to the provisions of Chapter XI of the Bankruptcy Act, 11 U.S.C. § 701, et seq. Approximately sixteen and a half months later, on September 8, 1975, a plan of arrangement was confirmed by the bankruptcy court.
Throughout the Chapter XI proceedings Aaron Ferer was represented by the law firms of Venteicher & Strasheim and White, Lipp, Simon & Powers. On August 13, 1975, the law firms submitted to the bankruptcy court an application for allowance of attorney's fees. Venteicher & Strasheim requested $113,250.00 for 952.8 hours of legal services. White, Lipp, Simon & Powers requested $126,930.00 for 1,040.7 hours of legal services. These figures reflect a rate of $125.00 per hour for primary counsel and a somewhat lower hourly rate for a minor amount of time expended by other persons. The application was supported by itemized computer time records. On August 26, 1975, a consolidated hearing was held before the bankruptcy court with respect to the plan of arrangement and the application for attorney's fees. Jerrold L. Strasheim and Ray R. Simon, appearing on behalf of their respective law firms, testified in support of their application. No evidence against the fees was introduced at the hearing.
On October 1, 1975, the bankruptcy court entered a memorandum opinion and order effecting the allowance of fees and expenses. Venteicher & Strasheim were allowed $69,118.00.1 White, Lipp, Simon & Powers were allowed $72,849.00. These amounts reflected a rate of $70.00 per hour.
Counsel for Aaron Ferer thereafter filed a timely motion for rehearing and reconsideration of the fee allowance. At the rehearing, additional evidence was presented to the bankruptcy court in support of the requested fees. On December 1, 1975, the bankruptcy court entered a memorandum opinion and order vacating in part its prior order of October 1, 1975, and allowing counsel the fees requested. The amounts allowed by the bankruptcy court were $117,575.00 for Venteicher & Strasheim and $126,930.00 for White, Lipp, Simon & Powers. Thus, the total allowance of attorney's fees was $244,505.00.
Appellant's first contention is that the bankruptcy court abused its discretion in granting counsel for Aaron Ferer a rehearing and in permitting the introduction of new evidence on the issue of attorney's fees. Appellant submits that the rehearing served only to relitigate the same issue previously decided by the bankruptcy court in its October 1, 1975, memorandum opinion and order.
Rule 923 of the Bankruptcy Rules2 adopts Fed.R.Civ.P. 59 for rehearings in bankruptcy proceedings. Fed.R. Civ.P. 59(a) reads in pertinent part:
A new trial may be granted to all or any of the parties and on all or part of the issues * * * in an action tried without a jury, for any of the reasons for which rehearings have heretofore been granted in suits in equity in courts of the United States. On a motion for a new trial in an action tried without a jury, the court may open the judgment if one has been entered, take additional testimony, amend findings of fact and conclusions of law or make new findings and conclusions, and direct the entry of a new judgment.
A wide range of discretion rests with the trial court in the granting or the refusing of a new trial and appellate review of the ruling is very limited.
This Court finds no abuse of discretion. While it is true that a new trial will not lie merely to relitigate old matter, see 6A Moore's Federal Practice, supra, Paragraph 59.07, the motion for rehearing in the instant case was based on error of law.3 It was, therefore, proper for the bankruptcy court to fully review the matter as well as receive additional testimony thereon.
Appellant's primary contention is that the allowance of attorney's fees to counsel for Aaron Ferer in the amount of $244,505.00 was excessive.
The original memorandum and order of the bankruptcy court allowed counsel for Aaron Ferer an attorney's fee "in accordance with their normal hourly rate and not for the rates applied for." Upon rehearing, the bankruptcy court found these fee allowances inadequate. The bankruptcy court set forth in a memorandum opinion its reasons for the increased fee allowances. The memorandum reads in extenso:
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