I filed a chapter 13 in 2010 made my 36 month payments and at the end I called my trustee only to find out that my bankruptcy attorney petitioned the court to add $2175.00 in additional charges that we told to me would be covered in the original $3300.00 I ave already paid. My second mortgage was forgiven and per the attorney he had to do extra work to complete that process however that was the initial agreement. I cannot find in all my paperwork where it says exactly what the initial $3300.00 was for but from the beginning I was never told of additional charges and the only paperwork I received was from the court after it was already approved. In the last three years I have received more paperwork and honestly I never understood what all of it said. Is there something I can do now?
Whether you were told that there would be additional charges or not, if your fee agreement provided that there would be additional charges, it is your responsibility to read the paperwork your attorney gives you. There is so much information that is necessary to give to someone filing Chapter 13 that it is unrealistic to expect that anyone would remember it, which is why the court requires everything to be put in writing. If the attorney was awarded additional fees for additional work, you should have received a copy of the motion and notice of the hearing at which the court awarded these fees to your attorney. Bankruptcy judges keep a very close eye on fees charged to consumers in a Chapter 13. Feel free to review the file with a disinterested attorney to see if the fees were reasonable. Hope this perspective helps!
Most motions to avoid residential liens (i.e., strip the 2nd DOT or LAM motion) are not contested. My fees for this work usually end up around $1,000-$1,500. Since your attorney's fees are a lot higher, you should wonder why. It is entirely possible that complications in your specific case justify the higher fees. You just need to review the fees and ask your attorney to explain.
The state of California REQUIRES a written agreement for fees charged to an individual in excess of $1,000. Also, the Central District of California (where you are) REQUIRES attorneys to obtain court approval for any fees over the Court's FIXED fee limit for chapter 13 cases. The Court also REQUIRES that you be served with the motion for the Court's approval of those fees. Therefore, you need to check these things:
1. Find your original agreement with the lawyer (or ask your attorney for a copy signed by you) to see if the flat fee $3,300 INCLUDES or EXCLUDES the Lien Avoidance Motion (also called a LAM motion). If the fee agreement says $3300 EXCLUDES the LAM motion, so far the attorney has done the correct thing. If the agreement INCLUDES the LAM motion, see my ACTION section at the end.
2. Find the fee motion (or ask your attorney for a copy) and make sure your name and proper mailing address are listed in the Proof of Service (usually the last page(s) of the document). If you are listed, so far the attorney has done the correct thing. If you are NOT listed, see my ACTION section at the end.
3. Review the content of the motion, looking specifically at the descriptions of the work provided and the time billed. Also look at the hourly rate. Try to determine if the fees charged are reasonable for the work done and CHECK THE MATH (make sure everything adds up). You may not have the knowledge to do so, but if you are charged for 60 telephone calls at 6 minutes each, there is probably something wrong there. If there are no glaring problems, so far the attorney has done the correct thing. If there are math errors or unreasonable charges, see my ACTION section below.
4. Find the ORDER granting the fee motion (or ask your attorney for a copy). Do two things: (i) make sure your name and proper mailing address are listed in the Proof of Service (usually the last page(s) of the document); and (ii) make sure the amounts in the order are the amounts the Trustee says you owe. If you are listed and the Order is the same amount as the Trustee says, so far the attorney has done the correct thing. If you are NOT listed or the amounts are different, see my ACTION section at the end (next).
A. After you have done the work above, the FIRST thing you should do (whether the attorney made an error or not), is to contact the attorney. I suggest you send a written letter or email so you can think about it ahead of time and you will have a record of what you said. Include the following in your letter:
*Your surprise at the amount of the additional fees
*A list of any errors or concerns you found doing steps 1-4 above
*If you are pretty sure you did not get a copy of the motion AND order until very recently, state so.
*OFFER what you believe is a reasonable amount to pay him.
Any agreement with the attorney must be in writing signed by both of you. Send a copy to the Trustee.
B. If you can't get an agreement with the attorney and there are CLEAR ERRORS IN MATH ONLY, go to the Trustee and see if you can work it out there.
C. If you can't get an agreement with the attorney and you are NOT listed as served with the fee motion AND the order (neither one lists you), make a motion to the Court to vacate the order due to improper service. You likely will need a lawyer to do this.
D. If you are listed as being served at the correct address on the fee motion OR the order, since it has now been YEARS since the hearing and the order, it is highly unlikely the Court will vacate or reconsider the fee motion now.
You can try filing a motion to reconsider the order approving your lawyer's fee application. If you were served with a copy of the fee application, the court may deny your motion on the ground that you should have objected to the application. Or not -- you won't know until you try.
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