TAKING SIDES across a widening rift between the circuit courts of appeal, the Fourth Circuit recently ruled that the debtor’s attorney in a case converted from Chapter 11 to Chapter 7 of the Bankruptcy Code is not entitled to be compensated by the bankruptcy estate for legal services provided subsequent to the conversion.
In United States Trustee v. Equipment Services, Inc. (In re Equipment Services, Inc.),[1]� the Court of Appeals held that because Congress, when it amended the Bankruptcy Code in 1994, omitted the “debtor’s attorney” from the list of persons eligible for compensation from the estate, a Chapter 7 debtor’s attorney cannot be paid with bankruptcy estate assets for services rendered during the case.
