CHAPTER 3CASE ADMINISTRATION
Sub Chapter II Officers
Sec. 328. Limitation on compensation of professional persons
(a) The trustee, or a committee appointed under section 1102 of this
title, with the court's approval, may employ or authorize the employment
of a professional person under section 327 or 1103 of this title, as the
case may be, on any reasonable terms and conditions of employment,
including on a retainer, on an hourly basis, or on a contingent fee
basis. Notwithstanding such terms and conditions, the court may allow
compensation different from the compensation provided under such terms
and conditions after the conclusion of such employment, if such terms
and conditions prove to have been improvident in light of developments
not capable of being anticipated at the time of the fixing of such terms
(b) If the court has authorized a trustee to serve as an attorney or
accountant for the estate under section 327(d) of this title, the court
may allow compensation for the trustee's services as such attorney or
accountant only to the extent that the trustee performed services as
attorney or accountant for the estate and not for performance of any of
the trustee's duties that are generally performed by a trustee without
the assistance of an attorney or accountant for the estate.
(c) Except as provided in section 327(c), 327(e), or 1107(b) of this
title, the court may deny allowance of compensation for services and
reimbursement of expenses of a professional person employed under
section 327 or 1103 of this title if, at any time during such
professional person's employment under section 327 or 1103 of this
title, such professional person is not a disinterested person, or
represents or holds an interest adverse to the interest of the estate
with respect to the matter on which such professional person is
(Pub. L. 95-598, Nov. 6, 1978, 92 Stat. 2563; Pub. L. 98-353, title III,
Sec. 431, July 10, 1984, 98 Stat. 370.)
Historical and Revision Notes
Section 328(c) adopts a technical amendment contained in the Senate
amendment indicating that an attorney for the debtor in possession is
not disqualified for compensation for services and reimbursement of
expenses simply because of prior representation of the debtor.
senate report no. 95-989
This section, which is parallel to section 326, fixes the maximum
compensation allowable to a professional person employed under section
327. It authorizes the trustee, with the court's approval, to employ
professional persons on any reasonable terms, including on a retainer,
on an hourly or on a contingent fee basis. Subsection (a) further
permits the court to allow compensation different from the compensation
provided under the trustee's agreement if the prior agreement proves to
have been improvident in light of development unanticipatable at the
time of the agreement. The court's power includes the power to increase
as well as decrease the agreed upon compensation. This provision is
permissive, not mandatory, and should not be used by the court if to do
so would violate the code of ethics of the professional involved.
Subsection (b) limits a trustee that has been authorized to serve as
his own counsel to only one fee for each service. The purpose of
permitting the trustee to serve as his own counsel is to reduce costs.
It is not included to provide the trustee with a bonus by permitting him
to receive two fees for the same service or to avoid the maxima fixed in
section 326. Thus, this subsection requires the court to differentiate
between the trustee's services as trustee, and his services as trustee's
counsel, and to fix compensation accordingly. Services that a trustee
normally performs for an estate without assistance of counsel are to be
compensated under the limits fixed in section 326. Only services that he
performs that are normally performed by trustee's counsel may be
compensated under the maxima imposed by this section.
Subsection (c) permits the court to deny compensation for services
and reimbursement of expenses if the professional person is not
disinterested or if he represents or holds an interest adverse to the
estate on the matter on which he is employed. The subsection provides a
penalty for conflicts of interest.
1984--Subsec. (a). Pub. L. 98-353 substituted ``not capable of being
anticipated'' for ``unanticipatable''.
Effective Date of 1984 Amendment
Amendment by Pub. L. 98-353 effective with respect to cases filed 90
days after July 10, 1984, see section 552(a) of Pub. L. 98-353, set out
as a note under section 101 of this title.
Section Referred to in Other Sections
This section is referred to in sections 326, 330 of this title.