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UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF ALASKA

Case No. A93-00568-HAR
In Chapter 7

In re JAMES L. HANGER and
MARILYN J. HANGER,

                                 Debtors
ADV PROC NO A93-00568-001-HAR
(BANCAP No. 94-3080)

ORDER DENYING ATTORNEY FEES
WILLIAM M. BARSTOW, II, Trustee,

                                 Plaintiff

          v.

JULIE BARNES, BARNES & SIEBERT
ENTERPRISES, BARNES ENTERPRISES,
AND B & S ENTERPRISES,

                                 Defendants

A Default Judgment And Final Judgment was entered for the plaintiff on January 3, 1995 (Docket Entry 14). Plaintiff requested attorney fees under Alaska Civil Rule 82.

The court had a question whether, since the judgment was to enforce a bankruptcy settlement, the court should adopt the American Rule that no attorney fees are generally awarded in an action involving application of federal law, subject to some exceptions. In re Harvey, 172 BR 314, 318 (9th Cir BAP 1994).

At the court's request, the plaintiff filed a Memorandum Re Rule 82 Attorneys' Fees on January 13, 1995 (Docket Entry 16). The memorandum argues that this adversary proceeding involved "a straightforward contract enforcement count    not peculiar to federal law," citing In re Bybee, 945 F2d 309 (9th Cir 1991), Holiday Mobil Home Resorts v Ward, 803 F2d 977, 979 (9th Cir 1986) and In re Sparkman, 703 F2d 1097, 1099 (9th Cir 1983). Debtor also cited In re Fobian, 951 F2d 1149, 1153 (9th Cir 1991), cert den 112 SCt 3032 (1992), to distinguish the present case.

These cases all (aside from Fobian which denied attorney fees) involved attorney fees with respect to proceedings to enforce prepetition   TOP    4 ABR 62  contracts, however. The present adversary involves a postpetition settlement made in the bankruptcy arena of a claim arising, at least in part out of postpetition events.

The Bankruptcy Appellate Panel has held that, in cases involving enforcement of a prepetition contract (even where normally allowable under state law or the contract), attorney fees are not generally awardable when intermingled with the bankruptcy issue of dischargeability. See, In re Itule, 114 BR 206, 213 (9th Cir BAP 1990), and In re Gee, 173 BR 189, 193 (9th Cir 1994).

In addition, the enforcement of a settlement in this circuit is available under summary procedures. In re City of Anaheim, Ltd., 22 F3d 954, 958 (9th Cir 1994). Arguably, the trustee might have sought to enforce the settlement in the main case.

The trustee's citations have not convinced me that attorney fees to enforce or establish a postpetition settlement between the trustee and a third party regarding estate property are awardable in the ordinary course by the bankruptcy court. My own research has only uncovered one case discussing the subject, In re Eliscu, 139 BR 883 (ND Ill 1992). There, after noting that the American Rule generally denies attorney fees in an action based on federal law unless it falls within an exception or is allowed by statute, the court did uphold an award based upon the vexatious nature of the other party's behavior, not as a matter of right.

Absent persuasive authority to the contrary, I think this case is more analogous to Itule than Holiday Mobil Home Resorts. Therefore,

IT IS ORDERED that plaintiff's motion for attorney fees pursuant to Rule 82 of the Alaska Rules of Civil Procedures is DENIED.



    DATED: January 24, 1995
                HERBERT A. ROSS
                U.S. Bankruptcy Judge