Opinion
No. FA 96-0537581S
January 6, 2006
INTERLOCUTORY ORDERS ON FEES OF ATTORNEY FOR THE MINOR CHILD AND OF THE GUARDIAN AD LITEM
This case came before this court on October 18, 2005. Unresolved on that day were motions numbered between 342 and 359, the earliest of which was filed on March 30, 2005, the latest on October 18, 2005.
As a preliminary housekeeping matter, the guardian ad litem (GAL) indicated that she would not be proceeding upon her motion for leave to withdraw appearance dated March 29, 2005 (#343), and that the proposed scheduling order dated May 16, 2005 (# 344) is now moot. Plaintiff marked off his objection to motion to compel dated April 26, 2005 (#345), his objection to defendant's disclosure of expert witness dated April 22, 2005 (#346), his motion to quash subpoena dated July 29, 2005 (#348), and Attorney Hasse's motion for leave to withdraw his appearance dated July 29, 2005 (#349).
Remaining before the court as of October 18, therefore, were the attorney for the minor child's (AMC) motion for contempt of August 1 (#351) with supporting affidavit (#352); the GAL's motion for costs and fees dated March 30, 2005 (#342), her motion for interim fees dated July 19 (#347), and her motion for determination of non-dischargeability dated October 18, 2005 (#359); the plaintiff's motion for allocation of GAL's and AMC's fees dated July 29, 2005 (#350), his objection to the AMC's contempt motion dated August 11, 2005 (#353), and his claim for stay due to bankruptcy dated August 29, 2005 (#356); and, finally, defendant's motion to modify alimony and child support dated September 27, 2005 (# 357).
Plaintiff has notified this court, and it is not disputed, that he filed a petition in the United States Bankruptcy Court for the District of Connecticut on August 26, 2005. Under CT Page 398 11 U.S.C. § 362, that event creates an automatic stay of all state court proceedings brought by the debtor's creditors to enforce their claims. It does not appear of record that the AMC has yet availed herself of the statutory procedures to receive relief from that stay under federal law. The GAL, in contrast, presented this court with an order from the bankruptcy court dated October 13, conditionally granting her motion for relief; the significance of this order is detailed below.
On the morning of October 18, the parties assembled before this court pursuant to a notice which the clerk's office had sent to each of them on August 29. From that date to the date of hearing, no objection to going forward on that date had been filed. As the proceedings commenced, plaintiff verbally noted his objection to the amount of fees sought by each of the court-appointed attorneys. Additionally, he argued that he should not be automatically ordered to pay one-half of those fees as he believed that the defendant's conduct was primarily responsible for the high amounts sought. It was suggested, and all parties agreed, that the proceedings be bifurcated. This court would hear evidence as to the reasonableness of the GAL's and AMC's requests, but would leave to a later day the issue of whether those fees would be split evenly or allocated between the parties on some other basis. The court also reviewed the bankruptcy court's order concerning the GAL's motion for relief from stay, and indicated it would accept the adjudicatory duty outlined in that order. At the conclusion of the day's hearing, the court allowed plaintiff and defendant to file briefs responding to the memorandum of law which the GAL had filed in support of her claims on October 12.
In a brief filed October 29 (after this court had spent almost a full day hearing the case), plaintiff raised additional objections to the hearing conducted on October 18. First, he argues that the AMC cannot go forward on her claim for fees, as she has not asserted nor shown that she has yet obtained relief from the automatic stay. See In re Sutton, 250 B.R. 771 (S.D.Fla. 2000). However, since the proceedings have been bifurcated by agreement, the issue of how much of the AMC's fees are due from the plaintiff (if any) is not yet before the court. The court notes that the parties stipulated that the reasonable value of her services is $12,701.44, and that none of that amount has been paid by either party to date. This stipulation followed a brief recess, prior to which the court had heard the following evidence. This court had appointed Attorney Lori Hellum as attorney for the minor child issue of the marriage in 1997. For a period commencing August 1998, and continuing through June of 2003, she was paid by the Judicial Department for her services in proceedings which took place in the Juvenile Court for New London Judicial District. In proceedings on this family docket between 1997 and August of 1998, and following June of 2003, she expended 93.45 hours in the matter. Her hourly rate at the beginning was $125, but later rose to $150. Her services included home visits with the child, office meetings with the child and parties, review of pleadings, discussions with both parents, drafting of documents, and trial preparation. The court is satisfied that her request for attorneys fees is reasonable, and finds that she is owed the sum of $12,701.44.
At the hearing to be held on plaintiff's motion for allocation of fees, the court will determine how much of that bill is to be paid by each party, and on what schedule.
The GAL, Susan Asselin-Connolly, asserts that she is due a fee of $78,542.30. As he does with respect to the AMC's claim, plaintiff objects both to the amount demanded and to his being held liable for any portion of the total; additionally, in his October 29 brief, he protests that the present proceedings violate due process in that this court had not "caused the motion (#359) to appear on the short calendar, heard argument, received evidence, or ruled on whether it will hear and determine the Section 523 motion." Also, he contends that his bankruptcy counsel and the bankruptcy trustee ought to have been notified of the hearing. He cites no authority in support of either of these claims.
Plaintiff's Brief of October 29, at page 6.
This court notes that the hearing of October 18 had been noticed almost two months before it commenced. Subject to the GAL's obtaining relief in the bankruptcy court from the automatic stay entered upon plaintiff's filing of his bankruptcy petition in August, the purpose of this hearing was to take action upon her motions, the latter of which had by October 18 been on file for more than ninety days. Plaintiff not only had ample opportunity to bring with him such counsel as he chose, but was in fact represented aggressively at the hearing by Attorney Michael Hasse. This court does not believe that state or federal rules require that a hearing be held in order to determine whether a "523 hearing" will be held at some later date. Moreover, the agreed-upon bifurcation of the evidentiary issues in this case provides plaintiff an additional opportunity to prepare for and present his best case as to why he should be ordered to pay less of the GAL's (and AMC's) claimed fees than defendant. It is unclear how the court's going forward on October 18 inflicted an prejudice upon him whatsoever.
The court heard from the GAL in support of her fee request, and has examined her Exhibit 1, consisting of a computer printout of her client ledger sheet for this matter. She was originally appointed by Judge Elliot Solomon in October of 1997, pursuant to the authority conferred upon him by § 45a-132 of the Connecticut General Statutes. Her appointment was expressly continued by Judge Hadley Austin in his dissolution judgment on December 5, 1997. Although appointments of a guardian ad litem may be deemed routine in cases in which the custody of young children is disputed by their parents, this case was anything but routine. Apparently, prior to the GAL's appointment, the parties' minor son had been removed from this state in derogation of court orders that he remain within this jurisdiction, not to return until July of 2002. During that five-year period, the GAL made numerous attempts at locating her ward, even involving international police authorities. When the child (then eight years old) was located in Florida, she made a rapid trip there to accompany him back to this forum and avoid his being treated as an abandoned child in that state.
Sec. 45a-132, captioned "Appointment of guardian ad litem for minors . . ." provides in pertinent part:
(a) In any proceeding before . . . the Superior Court . . . the judge or magistrate may appoint a guardian ad litem for any minor or incompetent, undetermined or unborn person, or may appoint one guardian ad litem for two or more of such minors or incompetent, undetermined or unborn persons, if it appears to the judge or magistrate that one or more persons as individuals, or as members of a designated class or otherwise, have or may have an interest in the proceedings, and that one or more of them are minors, incompetent persons or persons undetermined or unborn at the tine of the proceeding . . .
(d) Any appointment of a guardian ad litem may be made with or without notice and, if it appears to the judge or magistrate that it is for the best interests of a minor having a parent or guardian to have as guardian ad litem some person other than the parent or guardian, the judge or magistrate may appoint a disinterested person to be the guardian ad litem . . .
(g) Any guardian ad litem appointed under the provisions of this section may be allowed reasonable compensation by the judge or magistrate appointing him . . .
Her present claim is for time spent in the matter from January 1, 2000 through a cutoff date of October 12, 2005. Her time sheets show that in those almost six years of service she and her associate counsel recorded approximately 374.75 hours on the file. She filed legal pleadings; communicated with the parties and their counsel, with members of the extended family and other witnesses, and with law enforcement and child protection officials; attended court proceedings, and kept herself prepared for the multi-dimensional task to which this court had appointed her. The court does not find that her documentation of these efforts is exaggerated. Further, the court notes that her services were reasonably effective, as the child has been located and returned here in part due to her work.
She indicated that her billing rate had for most of the time been $200 per hour. She is an attorney first admitted to practice in this state in 1985. Most of her professional experience involved juvenile or family issues. This court notes that attorneys working in the Norwich-New London area, with experience similar to that of Ms. Connolly, regularly bill at rates of $200 per hour and greater. The court does not take issue with her use of the hourly rate of $200, in light of her training and the market in which she conducts her practice. The court did note that 26.6 hours of time spent had been billed at the rate of $250. It therefore has reduced her claim by $1,330, and finds that she is entitled to fees of $74,950, plus unpaid disbursements of $2,258.30, for a total of $77,208.30 through October 12, 2005.
The major thrust of plaintiff's challenge to the amount of her claim is that she spent some of that time in proceedings before the Waterford Juvenile Court. He has offered numerous documents as appendages to his October 29 brief aimed at showing that attorneys appearing in the state's juvenile courts are often paid by the state, at rates considerably lower than that at which the GAL is billing her services here. This argument is unpersuasive, however, as Ms. Connolly's detour into juvenile court was a function of her appointment by this court, not a separate appointment by that tribunal. The test of the reasonableness of her fee request should be judged by the standards typically employed in this forum, and this court has weighed her request in light of the multiple factors which our appellate court, in Ernst v. Deere Co., 92 Conn.App. 572 (2005), has recently said are pertinent in setting such fees: (1) the time and labor required, (2) the novelty and difficulty of the questions, (3) the skill requisite to perform the legal service properly, (4) the preclusion of other employment by the attorney due to acceptance of the case, (5) the customary fee for similar work in the community, (6) whether the fee is fixed or contingent, (7) time limitations imposed by the client or the circumstances, (8) the amount involved and the results obtained, (9) the experience, reputation, and ability of the attorneys, (10) the undesirability of the case, (11) the nature and length of the professional relationship with the client, and (12) awards in similar cases. 92 Conn.App. 572, 576.
As noted above, the bankruptcy court has also deferred to this court the determination of whether the fees of either the AMC or the GAL may be discharged in plaintiff's bankruptcy proceedings. While the dischargeability of a debt under Title 11 of the United States Code involves a question of federal law, state courts are competent to resolve such issues when neither the Constitution nor any statute withdraws such jurisdiction from them. That this court is competent to decide the dischargeability of an attorney fee award in a family case has recently been definitively determined by the appellate court, in Larson v. Larson, 89 Conn.App. 57 (2005).
A review of cases which have considered whether or not a bankruptcy petitioner may discharge a fee awarded to the GAL or AMC for his children in a divorce case reveals a general rule that he or she may not. An illustrative decision is that of In re Peters, 133 B.R. 291 (Bankr.S.D.N.Y. 1991), aff'd sub nom. Peters v. Heffenhoeffer, 964 F.2d 166 (2d. Cir. 1992). It examined the reach of the governing statute, 11 U.S.C. § 523, as applied to the fee request of a court-appointed guardian, and held that
11 U.S.C. 523, captioned "Exceptions to Discharge," provides at paragraph (a) that "[a] discharge under . . . this title does not discharge an individual debtor from any debt . . . (5) to a spouse, former spouse, or child of the debtor, for alimony to, maintenance of, or support for such spouse or child, in connection with a separation agreement, divorce decree, or other order of a court of record . . .", provided that "such liability is actually in the nature of alimony, maintenance, or support . . ."
`[t]he nature of support' is a broadly construed term in bankruptcy law. Unlike child support laws which require merely that child support orders ensure adequate basic living expenses for the child . . . federal bankruptcy courts addressing the term in the context of guardian ad litem fees have broadened the meaning of `support' pursuant to 11 U.S.C. § 523(a)(5)(B) to include any services inuring to the benefit of the child in a litigation connected with a matrimonial dispute . . . The reason for such a policy is clear. In any matrimonial action, whether it concerns the divorce, maintenance, support, custody, or post-decree proceedings implicating any of the foregoing, it is essential that each party be able to adequately represent its interest; accordingly, attorneys fees owed to spouses are deemed to be in the nature of support . . . Similarly, as the appointment of a guardian ad litem is for the purpose of effectively representing a minor child's best interests in a matrimonial dispute . . . the fees owed to the guardian ad litem can be deemed to be in the nature of support. 133 B.R. 291, 295; (citations omitted).
The fifth, ninth, and tenth circuits have reached a similar conclusion as to the general rule of nondischargeability of fee awards to court-appointed counsel for a child; see, respectively, In re Dvorak, 986 F.2d 940 (5th Cir. 1993), In re Chang, 163 F.3d 1138 (9th. Cir 1998), and In re Jones, 9 F.3d 878 (10th Cir. 1993). Previously, district courts across the country had reached the same conclusion; see, e.g., In re Morris, 14 B.R. 217 (Bankr.D.Colo. 1981); In re Yarns, 23 B.R. 370 (Bankr.N.D.Ill. 1982); In re Coleman, 37 B.R. 120 (Bankr.W.D.Wis. 1984); In re Laney, 53 B.R. 231 (Bankr.N.D.Tex. 1985); and In re Hicks, 65 B.R. 227 (Bankr.D.N.Mex. 1986). This list is not intended to be exhaustive. In 1992, a bankruptcy judge here in Connecticut considered the issue to be well enough settled as to be capable of resolution in a summary proceeding: In re Glynn, 138 B.R. 360 (Bankr.D.Ct. 1992) (Shiff, J.)
Lest plaintiff argue that the instant case is distinguishable, in that he has not stipulated, as did Ms. Glynn, that the attorney fees in question were "in the nature of support", this court notes, in light of the holdings in Peters and the other cases cited above, that such a concession on her part merely recognized a well established rule; had she not made it, other paths to the decision's conclusion could have been found.
Plaintiff has cited two bankruptcy court decisions which hold otherwise: In re Lanza, 100 B.R. 1989 (Bankr.M.D.Fla. 1989), and In re Aughenbaugh, 119 B.R. 861 (Bankr.M.D.Fla. 1990). Both are short, perfunctory readings of the statute, and both were authored by the same judge. They focus exclusively upon the statute's goal of providing a debtor with a fresh start, free of debts related to his life prior to filing a bankruptcy petition. However, the "fresh start" objective is not Congress's only concern. The second circuit has recently noted that the work of a guardian ad litem in contested dissolution proceedings helps to protect the best interests of the child, and is thus intrinsically connected with the statute's core concern for protection of family obligations. In Maddigan v. Maddigan, 312 F.3d 589 (2002), the court held that while
". . . the general purpose of bankruptcy law is `to provide the bankrupt with comprehensive, much needed relief from the burden of his indebtedness by releasing him from virtually all his debts' . . . the exceptions to discharge . . . prioritize considerations other than relief from indebtedness — § 523(a)(5), for example, reflects significant concern for the debtor's family obligations . . . Congress has chosen between two competing interests — those of bankrupts and those of their former spouses and offspring — and it chose in favor of the latter . . .
312 F.3d 589, 593 (citations omitted).
The two cases from the Middle District of Florida are in a distinct minority, and cannot be read as controlling in the face of such impressive authority to the contrary.
That minority includes a handful of other cases, apparently none of which is less than 20 years old.
While plaintiff cites a few other cases which he claims demonstrate that the general rule favors discharging the fees in question here, a close reading of those cases reveals them to be inapposite. In re Daulton, 139 B.R. 708 (Bankr.C.D.Ill 1992), dealt with an award of attorney fees to a former spouse and child, apparently related to property division issues; the decision turns upon the failure of the creditor opposing discharge to prove that the fees in question actually related to a support obligation. In re Duffy, (Bankr.S.D.N.Y. 2005) allowed the discharge of an order which the state court had characterized as a "support" order after the bankruptcy court held that it was, in fact, a mislabelled property settlement.
Discernment of that general rule against dischargeability, however, may not end the analysis. This court will be hearing evidence as to how the fees of the GAL and the AMC ought to be allocated between the plaintiff and the defendant. At that time, the court may scrutinize the financial circumstances of the parties to see whether they are so unusual as to justify some bending of that general rule. There is some authority at the federal level, seldom applied in any reported cases, that if payment of those fees would substantially impair the debtor's prospective ability to support the child or children who were the beneficiaries of the services for which the fees are sought then a court may fashion an equitable remedy, including allowing the debt to be discharged, in recognition of the priority of supporting the child. In Lowther v. Lowther, 321 F.3d 946 (10th Cir. 2002), the court affirmed a lower court order which had allowed the discharge of a $9,000 fee award in the case of a custodial parent whose total income, including child support from the noncustodian, was $1,060 per month. At such a meager level of existence, the court noted, strict adherence to the rule of nondischargeability would inevitably deprive the debtor of the means by which to fulfill her ongoing duty to support the child. Since the child is the putative beneficiary of the services rendered by his attorney or guardian ad litem, a rule that a parent must in every case fully compensate for those services might sometimes have to be tempered by an awareness of its effect upon that beneficiary's prospective best interests. The decision recognized that there may be cases, however few, in which the reasonable demand of the professional for services rendered conflicts with the child's need for future support from an indigent parent. How unusual the circumstances must be to achieve such an outcome is evident in the court's observation that this case, in 2002, is apparently one of first impression.
Shortly before the circuit court decision in Lowther was published, a judge of the Bankruptcy Court for the District of Connecticut (citing the lower court order which the appellate court affirmed) also commented, with some tentative approval, upon the "unusual circumstances" issue. In a "Memorandum of Partial Decision" in the matter of In re Manzi, 283 B.R. 103 (Bankr.D.Ct. 2002), Judge Weil rendered preliminary findings in a case in which an unemployed debtor, faced with supporting her children, sought to discharge a debt of $11,681 owed to the attorney who had served as AMC/GAL in debtor's dissolution action. There was no issue as to the fairness of the attorney's claim. Judge Weil's decision concludes by finding that the attorney had made out a prima facie case that the fee award was nondischargeable. However, she reserved to another day, and after a more thorough evidentiary hearing, the question whether satisfaction of the debt to the attorney-creditor could be accomplished without severely impairing the well-being of the very children whom § 523(a)(5) was designed to protect. Their interests, she ruled, are also at stake, and no final order could justly be entered without the court at least understanding how such an order would impact upon those interests.
It is of interest that the decision deems any distinction between fees of a guardian ad litem for minor children and a court-appointed attorney for minor children to be immaterial for the purpose of dischargeability determinations, and that the state court's failure to label the attorney fee award as "support" was likewise deemed immaterial. See Footnote 17 of decision, which also expressly rejects the conclusion of In re Lanza, supra.
Unfortunately, the result of that second round of inquiry does not appear in any published decision. At such a hearing, her partial decision indicates, the debtor would have the burden of going forward to produce sufficient evidence to warrant an exception to the general rule of nondischargeability. The memorandum forecasts caution on her part in weighing such evidence, in order that the general rule of nondischargeability not be swallowed up by the exception in every case in which the debtor is the custodial parent. In addition, she indicated, the result would not necessarily be "all or nothing," as she assumed she had broad authority to fashion a just remedy, including the authority to defer (by staying enforcement of) the attorney fee debt without going so far as to allow its full and final discharge.
See Footnote 18 of the decision.
Only three other decisions have been found which discuss the "unusual circumstances" discharge, and none of these ended happily for the debtor. In In re Sonntag, 2004 U.S.Dist. LEXIS 28599, the District Court for the Northern District of Texas affirmed a bankruptcy court decision holding that the debtor seeking a discharge on this basis had not proven facts which would entitle him to relief on this basis should such relief be legally available. In re Tyler, 2004 Bankr. LEXIS 1834, is a decision out of the bankruptcy court for Kansas which discussed the rule of Lowther with some implicit skepticism and ultimately held it not applicable on the facts of the case before it, in that the debtor was the noncustodial parent, and also because the state court which had ordered him to pay the attorneys fees at issue had already trimmed its award in light of his difficult financial situation. Finally, in In re Douglas, 330 B.R. 245 (Bankr.S.D.Cal. 2005), the court expressly declined to adopt the "unusual circumstances" analysis as a proper question under the guiding statute, and held that once court-ordered fees of an attorney professional are determined to be in the nature of support, it is the congressional intention that they not be dischargeable.
In light of all these three cases, it is not clear that the Lowther decision is anything other than an aberration. This court feels constrained against so ruling on this question of federal law, however, especially in light of the relevant local bankruptcy court decision in Manzi. Once an equitable apportionment of the parties' respective liabilities for the fees of Attorney Hellum and Guardian Asselin-Connolly has been made, this court may hear the parties out as to any claims they have that their particular circumstances are so unusual as to warrant an exception in their cases from the general rule with respect to their payment of the accounts of these professionals. It is prudent to await the laying of a proper factual foundation for such relief if it is to be afforded here.