In re Biggar, Bethea v. Robert J. Adams Associates, In re Fickling, and Rittenhouse v. Eisen
In re Biggar, 110 F.3d 685 (9th Cir. 1997)
In these four decisions, the 9th, 7th, 2nd and 6th Circuits all concurred that prepetition attorney fees are dischargeable. Moreover, several of these decisions affirm that postpetition attorney fees are not dischargeable.
In re Biggar, decided by the Ninth Circuit Court of Appeals on March 31, 1997:
[We] hold that the debts at issue in this case — debts arising from the provision of pre-petition legal services — are dischargeable in a bankruptcy proceeding.
Bethea v. Robert J. Adams Associates, decided by the Seventh Circuit Court of Appeals on December 17, 2003:
We therefore agree with In re Biggar that pre-petition debts for legal fees are subject to discharge under §727. … Those who cannot prepay in full can tender a smaller retainer for prepetition work and later hire and pay counsel once the proceeding begins — for a lawyer’s aid is helpful in prosecuting the case as well as in filing it.
At the very least, the supposedly superfluous language [in §329 (“compensation . . . agreed to be paid . . . for services . . . to be rendered”) covers not just pre-petition attorneys’ fees, but also post-petition attorneys’ fees, which are not dischargeable under Chapter 7.
We join three other circuits in concluding that pre-petition attorney fees are dischargeable. … §329 covers also post-petition attorney fees, which are not dischargeable.
Note that the Biggar opinion in the Ninth Circuit does not conflict with the Hines opinion in the Ninth Circuit, because Biggar applies to “debts arising from the provision of pre-petition legal services,” while Hines applies to debts arising from the provision of post-petitoin legal services that are contracted for on a pre-petition basis.
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