UNITED STATES BANKRUPTCY COURT

EASTERN DISTRICT OF KENTUCKY

PIKEVILLE DIVISION

IN RE:

DAVIDSON'S OF PIKEVILLE, INC.

DEBTOR CASE NO. 91-70323

CHAPTER 11

MEMORANDUM OPINION

This matter is before the Court on the Application for Allowance of Compensation and Reimbursement of Expenses for Counsel for Debtor-in-Possession, filed herein on June 2, 1992. Family Federal Savings Bank, a creditor of the debtor filed a Response to Request for Attorney's Fees on June 17, 1992. The U.S. Trustee filed an Objection to the Fee Application of Debtor's Counsel on June 18, 1992.

The record in this case shows that the debtor filed its Chapter 11 petition in this Court on June 21, 1991. The debtor filed its Application to Employ Counsel Nunc Pro Tunc on October 28, 1991. This Court entered an Order Authorizing Employment of Counsel Under General Retainer From the Estate of the Debtor on November 6, 1991. The Order authorized a general retainer of $5000.00.

Counsel for the debtor has submitted an Application for $34,456.50 in legal fees, representing 347.2 hours expended for legal services. The Application includes a request for reimbursement of expenses in the amount of $2,236.50. The Application is unclear as to the time period during which these amounts were incurred as at one point it states that it is June 21, 1991 through February 29, 1992, and at another point June 21, 1992 through April 30, 1992. The itemization contained in Exhibit A runs from March 6, 1991 through April 30, 1992.

The itemization states that the 347.2 total hours were expended. However, the correct total appears to be 324.2 hours. In addition, there are 1.10 pre-petition hours which do not appear to be directly related to the preparation and filing of the petition, and these will be subtracted from the total, making it 323.1. The corrected hours attributable to each attorney are as follows:

Total fees which may be claimed are therefore $32,284.50.

The debtor paid the applicant law firm a $5000.00 retainer at the outset of this case. This amount will be credited to the debtor. In addition, the debtor paid a total of $3,892.78 to the law firm's Frankfort office well after the petition had been filed. No authorization was sought or given for this payment, and this amount will therefore be disallowed, giving the debtor a total credit of $8,892.78. Subtracting this amount from the total fees which may be claimed leaves $23,391.72, and the Court will enter an order awarding this amount in fees to the applicant firm. The costs set out in Exhibit B will be allowed as well.

Dated:

By the Court -

_________________________________

Judge

Copies to:

Debtor

Bruce D. Atherton, Esq.

Ann E. Samani, Esq.

U.S. Trustee