Albert E Wolske and Karen Wolske

SUMMARY ORDER - 1
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF IDAHO
IN RE 	)
)
ALBERT E. WOLSKE and 	) 	Case No. 05-00515-TLM
KAREN WOLSKE, 	)
)
Debtors. 	) 	SUMMARY ORDER
)
________________________________ )
Albert and Karen Wolske (“Debtors”) filed their voluntary chapter 11
petition on February 18, 2005. The petition and related documents indicated they
were assisted by attorney Gale Merrick (“Counsel”).
On March 10, Debtors applied for the Court’s approval of their
employment of Counsel. See Doc. No. 9 (“Application”). Such an application
for approval of the employment of a professional under § 327(a) must be
accompanied by a verified statement of the proposed professional under Fed. R.
Bankr. P. 2014(a). This Application was not. Further, an application for approval
of employment of a professional must be filed, served and presented in accord
with Local Bankruptcy Rule 2014.1. The Application here was not. Among other
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SUMMARY ORDER - 2
things, the Application did not contain the detail required by LBR 2014.1(a) and it
was not served in compliance with LBR 2014.1(b).
The affidavit required under Fed. R. Bankr. P. 2014(a) was filed on August
10. See Doc. No. 43 (“Affidavit”). This Affidavit is perfunctory. It is doubtful
that it meets the command of the Rule as it has been interpreted by decisions of
this Court.
The Affidavit indicates Counsel holds no interest adverse to the “unsecured
creditors” of the case. The reason for this limitation is not clear.
The Affidavit also does not disclose whether or not Counsel performed
services prior to bankruptcy, though it would seem some services were necessarily
performed. The Affidavit does not indicate whether or not those services were
paid for or whether Counsel is a creditor of the estate. If a creditor, Counsel is not
disinterested and may not be employed at least absent a waiver of all unpaid
pre-petition claims.
On March 16, Counsel filed a Rule 2016(b) disclosure of compensation.
See Doc. No. 13. This disclosure indicates that prior to the filing of the disclosure
Counsel received $5,000.00 plus the amounts needed for Debtors’ filing fee.
Oddly, in the statement of financial affairs filed the same day (and as an
attachment to Doc. No. 13), Debtors indicated in response to question number 9
that they had made no payments within the year proceeding the commencement of
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SUMMARY ORDER - 3
the case to any person, including attorneys, regarding bankruptcy services. The
two documents are thus inconsistent.
Under LBR 2014.1(c), an order approving employment of a professional
will relate back to the date of service of the application. In this case, proper
service of the Application in compliance with the Local Rule has not yet been
made. Even if it might be argued that an order of approval of employment (once
the other noted defects are cured and such an order could properly be entered)
should relate back to the March 10 Application date, Debtors and Counsel want
more. The Application asks that the effective date of the approval be February 18,
2005, the petition filing date. A request for such nunc pro tunc approval must be
accompanied by submissions sufficient under controlling Ninth Circuit case law to
allow the Court to exercise its discretion and make the approval retroactive to
some earlier date. That, too, has not been done.
An order was submitted by Counsel and Debtors shortly after the August
10 Affidavit was filed. The Court has rejected that order and instead set forth in
this Summary Order the reasons why an order may not properly be entered at this
time. Approval of Debtors’ employment of Counsel is therefore DENIED. Denial
is without prejudice to further submissions in accord herewith.
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SUMMARY ORDER - 4
DATED: 	August 15, 2005
TERRY L. MYERS
CHIEF U. S. BANKRUPTCY JUDGE
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