Opinion
Jan. 20, 1970.
Editorial Note:
This case has been marked 'not for publication' by the court.
Page 89
Robert D. Inman, Denver, for plaintiff in error.
Lattimer, Robb & Naylor, Pueblo, for defendants in error.
DWYER, Judge.
This case was originally filed in the Supreme Court of the State of Colorado and subsequently transferred to the Court of Appeals under authority vested in the Supreme Court.
The issue in this case is the fee allowed the attorneys in a receivership proceedings.
The defendants in error are James L. Fimple, receiver for Ciruli Brothers, a partnership, and Lattimer & Robb, the court appointed attorneys for the receiver. They are referred to herein as the receiver and the attorneys. The plaintiff in error, Bemis Company, Inc., is a judgment creditor of the partnership and is referred to as Bemis.
By this writ of error, Bemis seeks reversal of an order authorizing payment of fees of $9,240 to the attorneys.
After the death of one of the Ciruli brothers, a dispute arose between the deceased's widow and the surviving partner over the dissolution of the partnership affairs. The receiver was appointed on August 3, 1964, and the attorneys were appointed on September 10, 1964. There was no objection to the appointment of the receiver or the attornys at that time. The attorneys undertook the work of the receivership, instituted lawsuits attempting to recover partnership assets, and engaged in litigation preserving, recovering, and defending the assets. On December 18, 1964, the attorneys were paid $2500 for their services to that date.
On August 26, 1965, Bemis filed its claim with the receiver as a judgment creditor. On November 1, 1965, Bemis filed a motion to discharge the attorneys on the ground that the attorneys also represented the executrix of the deceased partner.
On November 15, 1965, the attorneys filed a petition for fees for services rendered after December 18, 1964. Hearing on the petition for fees was held on December 6, 1965, and continued to and concluded on January 3, 1966.
On December 7, 1965, a stipulation signed by Bemis and other parties in interest was filed and provided:
'* * * all demands will be withdrawn for the removal of the law firm of Lattimer and Robb as attorneys for James L. Fimple, Receiver, upon an order of this court approving the appointment of Ernest O. Tulles as additional co-counsel for James L. Fimple, Receiver of Ciruli Brothers partnership.'
Pursuant to this stipulation, the court appointed the additional counsel.
At the hearings on the petition for fees, the attorneys produced their time sheets showing the date, the general nature of the work, and the time spent on the receivership. Each testified that the time itemized was actually and necessarily spent in preserving the assets of the receivership and in recovering, or attempting to recover, additional assets. The attorneys testified that they had spent many additional hours which they had not recorded on the time sheets.
Two practicing attorneys admittedly qualified as experts testified to the minimum hourly rate charged by the lawyers in the community. The minimum fee schedule of the Pueblo Bar Association approving this hourly rate was admitted in evidence without objection. Bemis presented no testimony at these hearings, but challenged the necessity for and the allowance of some of the hours claimed.
The court disallowed a few of the hours in question and determined the fee by applying the minimum hourly rate established by the evidence to the itemized time he found properly chargeable to the receivership.
The compensation of a receiver's counsel is within the control of the court by which the receiver is appointed, and it is the function of that court to determine both the necessity for counsel and the compensation to be allowed. Where, as here, most of the services performed by the attorneys were in the court which fixed the fee, the court has personal knowledge of the services rendered. In such cases, it has been held that the fee may be determined on the basis of the court's knowledge of the extent and value of the services rendered. The allowance is within the court's discretion and will be upheld unless it plainly appears that there has been an abuse of discretion. Welch v. Renshaw, 14 Colo.App. 526, 59 P. 967.
In the present case, the court had before it the entire record of the proceedings and evidence that the hourly rate charged was proper and that the time charged was actually spent on the receivership. The rule stated in Newey v. Newey, 154 Colo. 461, 391 P.2d 378 is applicable:
'When the hourly charges which these experts testified were reasonable in cases of this kind are applied to the time which the attorneys testified they spent, we cannot conclude that the amount awarded by the court as reasonable compensation is excessive as a matter of law in view of the complexities of this case and the skill required.'
In objecting to specific items for which charges were made, Bemis claimed that the attorneys did work not requiring legal training and that they improperly and unnecessarily engaged in activities outside the proper scope of the receivership. These objections presented issues of fact for the court's determination. Each of these claims was controverted by evidence presented by the attorneys. That court resolved these issues in favor of the attorneys and its findings are supported by the record.
Bemis contends that the fee allowed is disproportionate to the total amount of assets collected. The record indicates that approximately $32,000 was collected by the receiver; but the record also indicates that the attorneys had been engaged in extensive litigation attempting to recover assets of more than one million dollars, and that more than fifteen lawsuits had been instituted. The amount collected was but one of the factors to be considered by the court, and considered with other factors in the record does not, as a matter of law, require a reduction of the fee computed on an hourly basis.
Bemis contends here that the attorneys were entitled to no compensation because of their conflict of interest. Bemis, by stipulation in the trial court, withdrew all demands for the removal of the attorneys and cannot object to the attorneys receiving reasonable compensation for their services.
Judgment affirmed.
COYTE and DUFFORD, JJ., concur.