TMT Trailer Ferry, Inc., Matter of
| Decision Date | 10 August 1978 |
| Docket Number | No. 78-1808,78-1808 |
| Parties | In the Matter of TMT TRAILER FERRY, INC., Debtor. Irwin L. LANGBEIN et al., Appellants Cross-Appellees, v. Thomas KIRKLAND, Trustee for TMT Trailer Ferry, Inc., et al., Appellees Cross-Appellants. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Alexander S. Gordon, John McClure, Miami, Fla., for appellants cross-appellees.
Irwin L. Langbein, pro se.
Irma Mason, pro se.
Grant C. Guthrie, Atty., David Ferber, Sol., John M. Mahoney, Sp. Counsel, Judy L. Chesser, Atty., S.E.C., Washington, D. C., amicus curiae.
Irving M. Wolff, Miami, Fla., Seward & Kissel, New York City, for appellees cross-appellants.
Hervey Yancey, Miami, Fla., amicus curiae.
Appeals from the United States District Court for the Southern District of Florida.
Before THORNBERRY, COLEMAN and AINSWORTH, Circuit Judges.
In this appeal we review the correctness of an order of the district court dated February 14, 1978, fixing final fees for the trustee, counsel for trustee, and counsel for the Protective Committee for Independent Stockholders, growing out of a corporate reorganization under Chapter X of the Bankruptcy Act, 11 U.S.C. § 501 et seq. of TMT Trailer Ferry, Inc. The debtor filed its Chapter X petition in 1957. Now, after 21 years and numerous appeals to this Court, the proceeding is finally coming to an end. 1 The case is noteworthy for the distressingly bitter contests which have arisen during the course of the reorganization, especially in the last decade, when the animosity between counsel for the trustee and counsel for the Protective Committee has reached heights rarely seen by this Court in its consideration of hotly contested litigation. The Securities and Exchange Commission has fully participated in this case from its inception, as authorized and empowered by statute. See Section 208 of Chapter X of the Bankruptcy Act, 11 U.S.C. § 608. 2
Pursuant to a plan of reorganization filed by the trustee and approved by the district court on November 15, 1974, the operation of TMT was turned over to the purchaser under the plan, Crowley Maritime Corporation. Funds were then made available to pay the claims of creditors, plus accumulated interest, and an initial distribution of $3 per share to the stockholders was also made. Additionally, $1,000,000 was set aside for administrative costs and allowances.
Applications for final fees for services and for repayment of expenses were filed as follows:
Final Prior Balance
Compensation Interim of
Applicant Requested Allowance Request
--------- --------- --------- -------
Mr. Kirkland, trustee $ 457,852.50 $187,952.50 $269,900.00
Mr. Wolff, counsel to trustee 1,000,000.00 180,583.69 819,416.31
Mr. Langbein and Mr. and Mrs
Mason, counsel to Protective
Committee 843,370.27 60,000.00 773,370.27
The district court held extensive hearings on the several fee applications, received the SEC recommendations in that regard, and awarded final fees to applicants (less interim amounts already paid) as follows:
To Mr. Kirkland, trustee $457,853
To Mr. Wolff, trustee counsel 703,770
To Mr. Langbein and Mr. and Mrs. Mason
counsel for the Protective Committee $309,698
Plus expenses 20,000 329,698
--------
Being dissatisfied with the amounts awarded, counsel for the Protective Committee were granted permission to appeal from the district judge's order.
The district court awarded Mr. Kirkland $457,852.50 as his final fee for services as trustee (less interim amounts already paid) as requested. All of the parties, and the SEC, are agreed that the quality of services rendered by the trustee were superior and entitled to be properly compensated. The SEC recommended full payment to Mr. Kirkland of the amount he requested as his final fee. Counsel for trustee also agreed to this amount, but counsel for the Protective Committee suggest a lower figure while agreeing that Mr. Kirkland "has made a substantial contribution" (br., p. 41). Our own review of the matter and of the reasons assigned by the district court as to the trustee's fee convinces us that the amount awarded was correct, and the court's order to that effect is affirmed.
The district court awarded Mr. Wolff $703,770 as his final fee for services as counsel for trustee (less interim amounts already paid). This award was based on $603,770 for fees plus a bonus of $100,000 for what the court termed "extraordinary services." The SEC recommended a final fee of $375,000 (less amounts paid); counsel for the Protective Committee states that the fee of trustee's counsel should be reduced to $275,000 (less amounts paid). The SEC brief to this Court quotes from a supplemental memorandum on fees to the district court in which it summarized Mr. Wolff's "affirmative services" as follows:
Turning to affirmative services rendered, applicant acted as general counsel for the trustee for almost six years and dealt with a wide variety of legal problems incident to the business, including resisting condemnation of TMT's port facilities in Miami, Florida and negotiating for their relocation, leasing new terminal facilities in Puerto Rico, the chartering, leasing and purchase of vessels and trailers, rate matters before the Federal Maritime Commission and admiralty and insurance disputes. Special counsel were employed for certain labor negotiations.
In addition to the substantial volume of regular applications and reports to the court required in this kind of case, applicant successfully resisted the application of the former trustee and his counsel for additional compensation and negotiated settlements of four major claims and several smaller ones. As noted above, applicant directed his attention to reorganization problems rather late in the course of administration, but upon undertaking to move the reorganization, he proceeded effectively and with reasonable expedition.
The SEC memorandum as quoted in its brief further stated that a "significant part" of Mr. Wolff's work was "not only misdirected but was positively detrimental to the progress of the case."
The SEC also contends that even allowing for inflation the award is unreasonably high because Mr. Wolff would be compensated "at times in excess of $80 per hour."
Counsel for the Protective Committee contends that Mr. Wolff's services "have been wasteful and on balance more harmful to the reorganization than helpful."
On the other hand, Mr. Wolff in a detailed analysis of his services points to the successful termination of the reorganization, that creditors have received 100 per cent of their claims plus 17 years' interest, that $2,400,000 was set aside for stockholders and $1,000,000 for costs and fees. Mr. Wolff details the history of the reorganization, the financial plight in which TMT found itself when it was rescued from bankruptcy, how large claims against the estate were settled for considerably reduced amounts, and finally, sets forth the large amount of time which he expended over the period of his employment totaling in excess of 8,000 hours for which he claims he should be properly compensated.
There is no doubt that Mr. Wolff has rendered valuable and successful services to the reorganization and to its trustee. It is also apparent, however, that a substantial amount of the time involved for which compensation is sought is the result of squabbling and bickering which has gone on between Mr. Wolff and counsel for the Protective Committee. SEC counsel considers as much as a quarter to a third of Mr. Wolff's time was so occupied in 1970. On the other hand, the district court opinion makes reference to that SEC estimate (see footnote 66 of the order, p. 32) and declares it to be "without merit." In the same footnote the district court states: This Court has already shown its disagreement with some of the representations of Mr. Wolff with reference to prior appeals. It is clear that a portion of the time involved served only the personal antipathy which existed between counsel for the trustee and the Committee.
We consider the amounts awarded by the district court for services to be excessive. The court awarded $60 per hour for 1969 services though Mr. Wolff requested only $50 per hour; $60 per hour was also awarded for 1970; $70 per hour for 1971 and 1972 and $75 per hour for 1973 and 1974.
The SEC contends that Mr. Wolff, a solo practitioner, is seeking "senior partner rates for work which could have been adequately performed by a qualified associate."
The district court did not reduce compensable hours of Mr. Wolff due to time spent in internecine wrangling between counsel and gave $10 per hour more in 1969 than was requested. Finally "for extraordinary services" the court awarded an additional $100,000 to trustee's counsel which we hold was without warrant and is erroneous, and must accordingly be reduced. We conclude under all circumstances, after a full review of the matter, that Mr. Wolff should be compensated in the total amount of $600,000 less interim amounts previously paid, as his final fee for services in this reorganization proceeding, and that
this will adequately compensate him for services in the
reorganization. Fee of Mr. Langbein and Mr. and
The district court awarded counsel for the Protective...
To continue reading
Request your trial
-
Copeland v. Marshall
...without serving any purpose." LaSalle Extension Univ. v. FTC, 627 F.2d 481, 485 (D.C. Cir. 1980).43 See, e. g., In re TMT Trailer Ferry, Inc., 577 F.2d 1296, 1304 (5th Cir. 1978); B-M-G Inv. Co. v. Continental/Moss Gordin, Inc., 437 F.2d 892, 893 (5th Cir.), cert. denied, 402 U.S. 989, 91 S......
-
In re Monahan Ford Corp. of Flushing, Bankruptcy No. 02-23134-CEC.
...attorneys representing debtors.... In re McClanahan, 137 B.R. 73, 74 (Bankr.M.D.Fla.1992). See also Langbein v. Kirkland (In re TMT Trailer Ferry, Inc.), 577 F.2d 1296, 1304 (5th Cir.1978) ("The court ... is itself an expert on the question (of attorneys' fees) and may consider its own know......
-
Stroman Realty, Inc. v. Wercinski
...... an interpretation of personal jurisdiction under which the Commissioner—and, for that matter, any state official seeking to enforce her state's laws—could potentially be subjected to suit in ......
-
Burns v. Nielsen
...market rates as well as other indicia of a reasonable market rate." (internal quotation marks omitted)); In re TMT Trailer Ferry, Inc., 577 F.2d 1296, 1304 (5th Cir. 1978) ("The court, either trial or appellate, is itself an expert on the question (of attorneys' fees) and may consider its o......