On the other hand, petitioner attributes this conclusion to the Referee's dissatisfaction with the dismissal by this court as 'a tempest in a teapot' of the Referee's citation for contempt of the debtor's President, Travis.
The Referee also opined 'that the so-called arrangement under Chapter XI was not a bona fide one', because the debtor filed a consent to adjudication as a bankrupt 15 days after filing this petition for arrangement. Petitioner contends, to the contrary, that the time interval was no fair criterion of the bona fides under the circumstances, and that the intervention of the City of Philadelphia, because of alleged involvement in graft of some of its employees, and the indictment of Travis, with attendant wide notoriety, rendered the Chapter XI hopeless and the bankruptcy inevitable.
In its brief before us the Government stresses the Referee's disallowance in the Chapter XI proceeding of a claim for $ 275 fee by counsel for the receiver and the want of any appeal therefrom. Disregarding the utter irrelevance of this fact, we may note, in passing, that this disallowance was simultaneous with the allowance in full, over the Government's objection of claims for counsel fees of $ 2,000 and $ 650 by counsel for the receiver in bankruptcy and the trustee in bankruptcy, respectively, one of whom was the attorney whose claim for $ 275 was disallowed. Perhaps the allowance of the greater may have tempered any dissatisfaction stemming from the disallowance of the lesser.
From the evidence adduced before us we find the following
1. The attempted reorganization of the debtor was not successful.
2. Between April 4, 1961, when proceedings under Chapter XI became a practically and definitely determined course of action, and May 3, 1961, when petitioner's services in the Chapter XI proceeding ceased, petitioner, as attorney for the debtor, rendered 43 hours of professional services which were reasonably necessary and were rendered in aiding the debtor to prepare its schedules of assets and liabilities and to perform other statutory duties.
3. The fair and reasonable value of the services so rendered by petitioner in the Chapter XI proceeding, which were compensable, is $ 1,250.
4. The professional services rendered the debtor by petitioner in the Chapter XI proceeding in excess of 43 hours in endeavoring to accomplish a reorganization were services from which the estate derived no benefit and services which were not reasonably necessary and rendered in aiding debtor to prepare its schedules of assets and liabilities and to perform its other statutory duties.
5. Between May 4, 1961 and April 8, 1963, petitioner, as attorney for the bankrupt, rendered 20 hours of professional services which were for the benefit of the bankrupt estate.
6. The fair and reasonable value of the services so rendered by petitioner in the bankruptcy proceeding, which are compensable, is $ 500.
7. The professional services rendered by petitioner between May 4, 1961 and April 8, 1963 in excess of the aforesaid 20 hours were not for the benefit of the bankrupt estate.
Considering all the factors which bear upon the propriety and reasonableness of counsel fee for the debtor's counsel in the Chapter XI proceeding and in the bankruptcy proceeding, including but not limited to the size of the estate, we reach the following
CONCLUSIONS OF LAW
1. The order of the Referee fixing petitioner's counsel fee in the Chapter XI proceeding should be modified by increasing the amount of the fee therein from $ 300 to $ 1,250.
2. The order of the Referee fixing petitioner's counsel fee in the bankruptcy proceeding should be modified by increasing the amount of the fee therein from $ 200 to $ 500.