Local Rule 2014-2: DUTY OF COUNSEL FOR THE ESTATE WITH REGARD TO ESTATE'S EMPLOYMENT OF OTHER PROFESSIONALS

2014-2. DUTY OF COUNSEL FOR THE ESTATE WITH REGARD TO ESTATE'S EMPLOYMENT OF OTHER PROFESSIONALS [Former Rule 5 B]

A. Appraisers, auctioneers, accountants, brokers, special counsels, consultants, independent managers, and other professional persons employed by the debtors' estates are often unfamiliar with the requirements of bankruptcy law regarding the need for prior Court approval of their employment; regarding the record keeping and reporting requirements applicable to sustain their claim to subsequent compensation from the estate; and regarding the risk that there may be insufficient assets in the estate to satisfy such claims. Whether or not a professional person is familiar with such considerations, it is necessary and desirable that the responsibility for obtaining Court approval of such employment and for advising professionals of the responsibilities and risks of such employment be placed on the attorney for the estate.

B. Whenever the estate employs any other professional whose employment requires Court approval under the Bankruptcy Code or Rules, it is the duty of counsel for the estate to ensure that such approval is properly sought, and to advise the professional of the requirements and risks, if any, pertaining to the professional's ability to subsequently obtain compensation and reimbursement of expenses from the estate.

C. Estate counsel who fails to satisfy such duties may be determined by the Court to be personally responsible for any compensation and reimbursement of expenses lost to any professional as a result thereof.