This obligation is especially important in the instant case, given a recently published decision by this Court which stated: "The record in this case tends to indicate that the services performed by Deschenes and Watts did not benefit Debtor or the estate. See Keate v. Miller (In re Kohl), 95 F.3d 713, 714 (8th Cir. 1996)." In re Crown Oil, Inc., 18 Mont. B.R. 270, 283 (Bankr.Mont. 2000).

An attorney's fee application will be denied to the extent services were for the benefit of the debtors and did not benefit the estate. Kohl v. Miller (In re Kohl), 95 F.3d 713, 714 (8th Cir. 1996) (citing In re Reed, 890 F.2d 104, 106 (8th Cir. 1989)). Applicants bear the burden of establishing they are entitled to compensation.

The standards this Court applies when evaluating fee requests are set forth in the May 18, 2007, Memorandum of Decision and need not be repeated here. Morever, as this Court noted in In re Crown Oil, 18 Mont. BR 169, 257 B.R. 531 (Bankr. D.Mont. 2000), aff'd (9th Cir. BAP Sept. 28, 2001), "`[w]hile it is not necessary to have a successful reorganization in order for debtor's counsel to be awarded fees, fees may be denied when counsel should have realized that reorganization was not feasible and therefore services in that effort did not benefit the estate.'" Id. at 539, quoting In re Kohl, 95 F.3d 713, 714 (8th Cir. 1996); In re Coones Ranch, Inc., 7 F.3d 740, 744 (8th Cir. 1993); In re Lederman Enterprises, Inc., 997 F.2d 1321, 1324 (10th Cir. 1993). This Court went on to explain:

"While it is not necessary to have a successful reorganization in order for debtor's counsel to be awarded fees, fees may be denied when counsel should have realized that reorganization was not feasible and therefore services in that effort did not benefit the estate." In re Crown Oil, Inc., 18 Mont. B.R. at 283, 513, 257 B.R. at 539 (quoting In re Kohl, 95 F.3d 713, 714 (8th Cir. 1996)); In re Coones Ranch, Inc., 7 F.3d 740, 744 (8th Cir. 1993); In re Lederman Enter., Inc., 997 F.2d 1321, 1324 (fees may be disallowed where counsel knew or should have known that reorganization was not a viable possibility). Debtor filed the case sub judice to prevent a sheriff's sale of the sawmill equipment, vehicles and logs. Luinstra and Allen admit that the Debtor's only hope was a liquidation, and that a financial reorganization was not possible.

"While it is not necessary to have a successful reorganization in order for debtor's counsel to be awarded fees, fees may be denied when counsel should have realized that reorganization was not feasible and therefore services in that effort did not benefit the estate." Berg, 268 B.R. at 258, 19 Mont. B.R. at 242; Crown Oil, Inc., 257 B.R. at 539, 18 Mont. B.R. at 513 (quoting In re Kohl, 95 F.3d 713, 714 (8th Cir. 1996); In re Coones Ranch, Inc., 7 F.3d 740, 744 (8th Cir. 1993); In re Lederman Enter., Inc., 997 F.2d 1321, 1324 (fees may be disallowed where counsel knew or should have known that reorganization was not a viable possibility). Both Berg and Crown Oil involved Chapter 11 cases which were converted to Chapter 7, while in the instant case Cossitt filed the motion to convert from Chapter 13 after his client failed to respond to his and the Trustee's requests for information. Despite that difference, this Court considers the analysis of Berg and Crown Oil under § 330(a) appropriate in a Chapter 7 case which has been converted from Chapter 13, with an important exception.

While it is not necessary to have a successful reorganization for debtor's counsel to be awarded fees, fee may be denied when counsel should have realized that reorganization was not feasible and therefore services in that effort did not benefit the estate.Crown Oil, 257 B.R. at 539, quoting In re Crown Oil, Inc., 18 Mont. B.R. at 283, (quoting In re Kohl, 95 F.3d 713, 714 (8th Cir. 1996)); see also, In re Lederman Enterprises, Inc., 997 F.2d 1321, 1324 (10th Cir. 1993) (fees may be disallowed where counsel knew or should have known that reorganization was not a viable possibility). In severely limiting the awarded fees, this Court in Crown Oil, noted that "[b]oth professionals knew or should have known early on in this case that reorganization was not feasible."

In re Crown Oil, 257 B.R. 531, 540 (Bankr.D.Mont.2000)(citing In re Kohl, 95 F.3d 713, 715 (8th Cir.1996) (remaining citation omitted). Nevertheless, whether a Chapter 11 debtor confirms a Chapter 11 plan remains a relevant factor for the Court to consider when considering whether the services provided a benefit to the estate.

A logical implication of this objective analysis is that incidental benefit to the estate does not necessarily justify compensation of services, especially if the services had a negligible likelihood of benefitting the estate at the time they were performed. The majority view, which rejects the hindsight evaluation of services, recognizes that a successful reorganization is not necessary for compensation to be awarded. Keate v. Miller (In re Kohl), 95 F.3d 713, 714 (8th Cir. 1996); In re Collida, 270 B.R. 209, 241 (Bankr. S.D. Tex. 2001); In re Crown Oil, Inc., 257 B.R. 531, 541 (Bankr. D. Mont. 2000). Requiring a successful reorganization would deter lawyers from serving as counsel in reorganization cases where success is less than absolutely certain.

A logical implication of this objective analysis is that incidental benefit to the estate does not necessarily justify compensation of services, especially if the services had a negligible likelihood of benefitting the estate at the time they were performed. The majority view, which rejects the hindsight evaluation of services, recognizes that a successful reorganization is not necessary for compensation to be awarded. Keate v. Miller (In re Kohl), 95 F.3d 713, 714 (8th Cir. 1996); In re Collida, 270 B.R. 209, 241 (Bankr. S.D. Tex. 2001); In re Crown Oil, Inc., 257 B.R. 531, 541 (Bankr. D. Mont. 2000). Requiring a successful reorganization would deter lawyers from serving as counsel in reorganization cases where success is less than absolutely certain.

"[A]n attorney fee application in bankruptcy will be denied to the extent the services rendered . . . did not benefit the estate." In re Crown Oil, Inc., 257 B.R. 531, 540 (Bankr. D.Mont. 2000), quoting In re Kohl, 95 F.3d 713, 714 (8th Cir. 1996). "This rule is based upon the legislative history of the Bankruptcy Code section 330(a) and the unfairness of allowing the debtor to deplete the estate by pursuing its interests to the detriment of the creditors."