UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF KENTUCKY
MT. VICTORY COAL COMPANY, INC.
DEBTOR CASE NO. 77-60027
This matter is before the Court on the Motion to Pay Attorney for Creditors' Committee Interest Upon Allowed Attorney Fee Award, filed herein on March 3, 1993, by John W. Ames, attorney for the creditors' committee in this case. The application for the payment of interest is based upon the delay in payment of the fee from the time it was approved until it was ultimately paid. It does not appear that any objection to Mr. Ames's Motion has been raised.
Attorney fees were awarded to Mr. Ames in the amount of $6,183.75 on October 1, 1982. Assets did not become available to pay these fees until 1992, and the receiver herein paid Mr. Ames the sum of $6,183.75 on October 12, 1992. Mr. Ames seeks to apply an interest factor of eight percent (8%) compounded annually, a rate he identifies as that historically used in bankruptcy cases to calculate present value. The present value of the fee award calculated from October 1, 1982 through March 2, 1993 at eight percent is $13,795.02, leaving $7,611.27 remaining to be paid.
Mr. Ames cites in support of his application Missouri v. Jenkins, 109 S.Ct. 2463 (1989) and Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 107 S.Ct. 3078 (1987), also known as Delaware II. These cases acknowledged that a professional's fees can be adjusted for delay in payment. This principle has also been applied in bankruptcy cases. The court in In re Commercial Consortium of California, 135 B.R. 120 (Bkrtcy.C.D.Cal. 1991), cited the above-referenced cases in holding that "the use of current hourly rates should be permitted to compensate counsel for unavoidable delay in allowance of fees". The court also recognized that the allowance of interest was another method of compensating professionals for delay in payment. Id., at 127. See also In re White Motor Credit Corp., 50 B.R. 885, 891 (Bkrtcy.N.D.Ohio 1985), in which the court stated that interest may be appropriate as a delay factor in determining reasonable fees.
In consideration of all of the foregoing, it is therefore the opinion of this Court that the Motion to Pay Attorney for Creditors' Committee Interest Upon Allowed Attorney Fee Award should be sustained. An order in conformity with this opinion will be entered separately.
By the Court -
John W. Ames, Esq.
Wheeler B. Boone, Esq.
Dan D. Brock, Jr., Esq.