The opinion of the court was delivered by: MEANEY
Applications having been made for allowances in the matter of the Star Electric Motor Company, debtor the following determinations have been made by the Court.
On February 18, 1946, the debtor, seeking reorganization in this Court under Chapter X of the Bankruptcy Act, 11 U.S.C.A. § 501 et seq., through its counsel, filed a petition under the provisions of the said Act. An order was entered approving the petition as filed in good faith and the Court appointed Augustus C. Studer, Jr., as trustee. Subsequently, on notice to all parties in interest, this appointment was made permanent.
Thereafter a creditors' committee was recognized by the Court. The committee through its counsel I. Charles Lifland and Sydney L. Jacobs, applied for the appointment of a co-trustee, to be possessed of technical training, and requested an independent audit of the books and records of the debtor, the expense thereof to be borne by the debtor. After argument, the request for a co-trustee was withdrawn and on the court's intimation that any independent audit would be at the expense of the creditors' committee, this phase of the matter was not pressed. Ensuing events proved that there was no need for the appointment of either a co-trustee or an independent audit.
On the date of appointment, the trustee took over the management and operation of the debtor company, the assets of which had a conservative valuation of approximately $ 5,000,000. There was, however, very little working capital. It was necessary for the trustee to borrow, on his certificate, money sufficient to meet the current payroll. Thereafter, in cooperation with the counsel for the debtor, the affairs of the company were carried on by the trustee with such skill and foresight that liquidation was averted and a dismissal of the proceedings effected, although in the course of the administration of the debtor's affairs liquidation seemed inevitable on several occasions.
The Court was in constant touch with the proceedings and is familiar with all of its details.
It was decided by the trustee, counsel for the debtor, and the officers and directors of the debtor, that the plant and adjoining real estate of the debtor should be sold. At the request of the trustee and after full consideration of the situation, the court appointed Ralph G. Schwebmeyer & Company sole agent for the sale of the property. Through the agent an arrangement was made and a deal consummated whereby the Prudential Insurance Company of America bought the real estate for $ 1,000,000 and leased the entire property to Tung-Sol Lamp Works, Inc., for a period of 25 years, Tung-Sol Lamps Works, Inc., in turn leasing approximately 55% of the total building space to the debtor company. Through this operation the debtor company was enabled to make application for dismissal of the proceedings. All creditors with claims aggregating nearly $ 1 400,000 have been paid in full, with interest.
On July 1st, 1946, the proceedings were dismissed, jurisdiction being retained for certain details only.
Now comes the question of allowances to be made upon applications submitted to the Court. These applications were as follows:
I. Charles Lifland and Sydney I. Jacobs, jointly as counsel for the Creditors' Committee $ 10,000.00
Nathan Bilder, as counsel for certain creditors $ 750.00
Mortimer J. Davis, Secretary of the Creditors' Committee $ 3,500.00
August C. Studer, Jr., Trustee $ 50,000.00
Andrew B. Crummy, Counsel for the Debtor $ 45,000.00
In determining the amount of allowances, the factors to be considered include 'the extent of the services contributed, the experience and skill required and exercised, the benefit resulting therefrom to the debtor and its security holders, the size of the debtor and the consequent responsibility undertaken, and the ability of the debtor to pay'. Newman v. Ambassador ...