737 F.

2d 115

Bankr. L. Rep. P 69,896

In re CERTAIN SPECIAL COUNSEL TO the BOSTON &
MAINE
CORPORATION, Petitioners.
No. 84-1248.

United States Court of Appeals,

First Circuit.
Submitted April 6, 1984.
Decided June 12, 1984.

William S. Green, Sheehan, Phinney, Bass & Green, Manchester, N.H.,

Edward I. Masterman, Cargill, Masterman & Culbert, Boston, Mass.,
Ralph J. Moore, Jr., Shea & Gardner, Washington, D.C., John J.C.
Herlihy, Herlihy and O'Brien, Edward F. McLaughlin, Herrick & Smith,
Boston, Mass., Charles H. White, Jr., and Arnall, Golden & Gregory,
Washington, D.C., on Petition for Mandamus.
Robert W. Meserve, Benjamin H. Lacy, and Hill & Barlow, Boston,
Mass., on Memorandum of Robert W. Meserve and Benjamin H. Lacy,
Trustees in Reorganization of the Boston and Maine Corporation, in
response to Petition for Mandamus.
Joseph J. Hurley, and Nutter, McClennen & Fish, Boston, Mass., on
Memorandum for respondents in response to petitioners' reply.
Before CAMPBELL, Chief Judge, BOWNES and BREYER, Circuit
Judges.
PER CURIAM.

Petitioners, six attorneys who performed legal services during the

reorganization of the Boston & Maine (B & M) Corporation,1 have filed a
petition for writ of mandamus seeking a prompt disposition of their outstanding
fee petitions. Their chief complaint is that the reorganization judge, in the
District Court for the District of Massachusetts, has been dilatory in ruling on

the question of their fees.

2

Petitioners' fee applications were filed at different times between December

1980 and June 1983. Certain of them were then approved by the ICC, and were
heard by respondent in 1981 or 1982; others have yet to be referred to the ICC
or scheduled for hearing. The judge has not ruled on any of them.

Action on the petitions was complicated by the question of whether the trustees
had ever received proper judicial authorization to hire petitioners as special
counsel. Respondent, the reorganization judge, first cast doubt on the
sufficiency of the trustees' authorization in January 1982, when sua sponte he
revoked Orders 65, 65-A, 65-B, and 105 entered in 1971 and 1972 by his
predecessor reorganization judge. (See Appendix.) The revoked orders, inter
alia, had purported to authorize the reorganization trustees to appoint and
substitute special counsel to represent the debtor's interests in tort claims,
eminent domain proceedings, and "other types of court and administrative
litigation." The problem with the revoked orders was as follows: General Order
44, in effect at the time the orders had entered, as well as successor procedural
provisions (see, e.g., former Bankruptcy Rule 215, Interim Bankruptcy Rule
2006, and current Bankruptcy Rule 2014) directed that the trustees seek court
approval of the employment of counsel by application stating the name of the
counsel to be employed, the reasons for counsel's selection, the services to be
rendered, the necessity for employing counsel, and the attorney's connections
with the debtor, creditors, or other parties in interest. Neither the revoked
orders nor the applications supporting them, however, had specifically named
petitioners or contained the detail required by General Order 44 and successor
procedural rules. Rather, the revoked orders, apparently in an attempt to
expedite the handling of the numerous2 law suits in which the railroad was
involved, had purported, in a more blanket form, to authorize the trustees to hire
counsel.

In hiring petitioners as well as other attorneys who are not parties to the present
mandamus proceeding, the trustees had relied on these orders which the
respondent subsequently revoked.3 To clarify the doubt about the attorneys'
status and entitlement to compensation raised by the respondent's January 1982
revocation order, the trustees in April 1982 filed Application for Order No. 652
asking respondent to confirm and authorize the appointment of counsel
effective retroactively as of the date work had been assigned to them.
Accompanying the application was a list of counsel affected and the matters on
which they had worked. Application for Order No. 652 was supplemented by
three more applications (numbers 658, 659, 660) addressed to the retroactive
confirmation of the employment of three of the present six petitioners. A

hearing was held on the latter three applications in July 1982. One of the
reorganization trustees testified, describing the valuable services the three
petitioners had rendered the estate, and representatives of the first mortgage
trustees and second mortgage trustees endorsed the retroactive confirmation of
the three petitioners' appointments.
5

Two months later (September 1982), respondent referred the trustees' original
application for confirmation (application for Order 652) to a master, and the
master rendered his report in early January 1983. The report chronicled the
services the attorneys had performed, found that the appointments had been in
the best interest of the estate, and that the attorneys had not held interests
adverse to the trustees or estate, and recommended retroactive confirmation of
the attorneys' appointments. As to most attorneys and as to most matters
handled by those attorneys, the master found that their employment was within
the scope of the revoked orders. In a limited number of matters, the master
expressed the view that the matters were not within the literal scope of the
revoked orders but that, in such cases, counsel had relied on the apparent
authority granted by the orders to the trustee. A hearing on the master's report
was held in March 1983 at which time a copy of the Fifth Circuit's decision, In
re Triangle Chemicals, Inc., 697 F.2d 1280 (5th Cir.1983), which
comprehensively treats the subject of retroactive confirmations, was given to
respondent. By the end of July 1983, briefs from petitioner Moore and the
trustees discussing the relevant legal issues had been filed.

The issues raised by the revocation of the 1971 and 1972 orders in January
1982 concerning petitioners' status and entitlement to compensation out of the
estate remain unresolved today. We must agree with petitioners that the judge
has delayed too long. As petitioners point out, the passage of time erodes the
value of any fees recovered, and we see no reason why a decision could not
have been rendered more seasonably. Respondent first raised the issue in
January 1982. Thereafter it was explored first by a master and then in
proceedings on the master's report. By August of 1983 at latest it was plainly
ripe for decision, and we would have expected a decision in the fall of 1983.
Not until February 17, 1984, however, did respondent give some indication of
his intentions. At this time he sent to the trustees advance copies of a
memorandum which he proposed to file shortly. The memorandum concluded
that the attorneys who had been retained without full compliance with General
Order 44 (or successor procedural provisions), and without the court's advance
confirmation of their specific appointments, were not authorized to render
services for the estate. It rejected the trustees' view that entering orders nunc
pro tunc could properly validate the appointments retroactively, concluding,
instead, that the function of a nunc pro tunc order is limited to correcting the

record to note that which had actually been done, but not recorded, at an earlier
time.
7

The memorandum would not entirely foreclose compensation--it indicated that

some compensation might still be awarded under the application of equitable
principles--but concluded that the attorneys were the real parties in interest; that
"[i]f the trustees were allowed to press the compensation petitions on the basis
of equitable principles, their efforts would appear incompatible with their
fiduciary duty to the creditors still unpaid"; that therefore the matter should be
resolved in the context of the attorneys' applications for compensation; and that
an order would be entered inviting the affected attorneys to argue equitable
principles in supplementation of their applications for compensation.

The trustees requested that the February 17, 1984 memorandum not be filed
until they had a chance to respond. This request was granted; the trustees
replied; and the memorandum has not yet been filed. Correspondence between
the trustees and the reorganization judge indicated that in applying equitable
principles to the attorneys' fee applications, the judge might be considering
some sort of weighing of the relative equities of the attorneys' position against
the position of unsecured creditors (who under the plan earlier approved by the
judge were entitled to receive a ceiling of 10 percent of their claims).

On March 13, 1984, respondent entered the order contemplated in the still
unentered February 17, 1984 memorandum. The March 13, 1984 order
enumerated certain matters which should be included with fee petitions and
directed that any attorney whose appointment had not been specifically
confirmed by court order to submit a memorandum "of factual particulars,
reasons and citations of authority relied upon in support of legal and equitable
principles relevant to the compensation claimed." Believing they had already
submitted everything called for by the March 13, 1984 order and perceiving the
order as heralding further delay in the resolution of their fee petitions, some of
which had been outstanding for years, petitioners filed the present petition for
mandamus.

10

Petitioners ask this court to settle the question of their entitlement to

compensation and then to direct that their fee petitions be reassigned to a
different judge. Respondent has agreed that the mandamus petition might
usefully be employed as a vehicle for resolving the legal issue of fee
entitlement. The trustees would also like to have this question decided. In view
of the requests of all parties, because of the lengthy delay already experienced,
and to speed the ultimate resolution of the fee petitions, we rule on the legal
issue. In a later part of the opinion we also rule on the request that the fee

petitions be reassigned to another judge.

11

A. Petitioners' Entitlement to Fees.

12

From what has been presented, we conclude that petitioners should receive
appropriate fees for the services they rendered.

13

To decide this matter, we do not have to go so far as to determine the broad

question of whether a bankruptcy court may validate nunc pro tunc the
appointment of special counsel who have performed services for the debtor
without prior authorization of any type from the court. In re Triangle
Chemicals, Inc., 697 F.2d 1280 (5th Cir.1983). Petitioners were hired pursuant
to preexisting orders of court authorizing the hiring of special counsel in the
manner adopted. While in some limited instances, the master, at least, felt that
the employment may have been beyond the scope of the orders, the trustees, in
our view, acted within a reasonable reading of the orders. The orders did not
completely comply with the applicable general order or rule, but it is not
suggested that the prior reorganization judge and the trustees did not act in
good faith. They apparently believed that because of the many legal matters in
which the railroad was regularly involved, and the normal turnover in
attorneys, that it was not necessary to file separate applications seeking
confirmation of each appointment every time, for example, a tort action was
filed. The trustees apparently drew a distinction between counsel hired for legal
work peculiar to a reorganization and counsel hired for legal work of a type
which any railroad, whether or not in reorganization, might carry on in the
normal course of business. They concluded General Order 44 was aimed at the
former. That the trustees (and original reorganization judge) may have erred in
their interpretation of the law (a question we need not pursue here) does not
negate the fact that, in hiring petitioners, the trustees were acting in reasonable
reliance on a court order. It also does not negate the fact that petitioners
accepted employment in good faith pursuant to the court's order.

14

Courts, including this one, have taken a strong stand against paying legal fees
to counsel whose appointment was not properly authorized. In allowing fees on
these facts we in no way mean to suggest any retreat from the requirement both
that the rule be carefully observed and that fees normally be denied absent
proper advance authorization. We hold only that in these exceptional
circumstances where counsel were hired by the trustees pursuant to preexisting
court orders issued in good faith, and where there was room for legitimate
confusion as to what type of order might be acceptable and what the exact
scope of that order might be, and where counsel were hired to work not on
reorganization matters but on legal matters arising in the course of the firm's

business, counsel should not be denied payment for services of value to the
estate. We observe that payment of these fees appears to have been anticipated,
and a reservation of funds made at the time the final plan of reorganization was
negotiated and approved. No one opposed the trustees' application to confirm
counsels' appointment. In fact, major creditors urged that the appointments be
confirmed. There was no suggestion that counsels' appointments would have
been disapproved by the court had prior court approval of each appointment
been individually sought. According to the master's report relative to certain
petitioners, substantial and valuable services were conferred. What was done,
insofar as appears, was necessary to the survival of the railroad and contributed
to its rehabilitation, to the advantage of all creditors.
15

Thus we hold that in these special circumstances, particularly given the

trustees' reasonable reliance on the court orders for authority to employ
petitioners,4 their appointments should be confirmed, to be effective as of the
date work was assigned to them.5 This means that petitioners will be placed in
the status they would have occupied had prior court orders been entered which
complied strictly with the rule.

16

Our ruling does not reach the question of the amounts of petitioners' fees. These
should be determined in the usual manner. Given the lapse of time, however,
they should be determined expeditiously. Respondent may, if he wishes, refer
such matters to a master. To avoid any question as to what we mean by
"expeditiously", we direct that petitioners' fee petitions be finally resolved
within four months from the date of this opinion.

17

B. Reassignment to Another Judge.

18

Petitioners have asked that the fee petitions be reassigned to a different judge.
Respondent and the trustees have opposed this request. We do not know the
position of other attorneys, not parties to this mandamus proceeding, who may
also be seeking attorneys' fees. At this point, we are not convinced
reassignment would be in the interest of the efficient winding up of the estate,
and we do not order it. Respondent's familiarity through many years'
involvement in the reorganization proceeding would be sacrificed were the fee
petitions reassigned. Assignment of petitioners' fee petitions to a different judge
while other fee petitions remained with respondent conceivably could result in
disparate treatment and conflicting results were the fund reserved for
administration expenses to be inadequate. Moreover, the reorganization
proceedings are nearly complete; and, unless there are major issues not revealed
in the proceedings descriptions that we have before us, we should expect to see
that termination occur in the near future. We believe it unwise to erect any

procedural obstacle to a final and speedy termination.

19

Petitioners suggest respondent took an aggressive adversarial position in his

response to the mandamus petition which may make it difficult for him "to rid
himself of his prior conclusions," O'Shea v. United States, 491 F.2d 774, 779
(1st Cir.1974), and to deal objectively with their fee petitions. We are not
convinced that this is so. The mandamus response reflects the legal views
expressed in the February 17, 1984 memorandum. In the circumstances
presented here, we do not think the expression of legal views necessitates
reassignment. The reorganization court was confronted with a troublesome
point on which any court might legitimately have entertained some concern.6
Now that we have made our ruling--namely, that, on the information presented
to us, petitioners' appointments should be confirmed--we are confident
respondent will deal fairly and expeditiously with petitioners' fee petitions. Cf.,
e.g., Halliday v. United States, 380 F.2d 270, 272-73 (1st Cir.1967)
(reassignment is especially desired "when the court is reweighing factual
inferences and credibility, as distinguished from applying rulings on issues of
law ") (emphasis added), aff'd on other grounds, 394 U.S. 831, 89 S.Ct. 1498,
23 L.Ed.2d 16 (1969).

20

Our views having been expressed, there is no need for formal issuance of a writ
of mandamus. In re United States, 348 F.2d 624, 626 (1st Cir.1965).
Consequently, the petition for a writ of mandamus is denied without prejudice
to reapplication should the fee petitions not be materially resolved within the
time ordered.

21

So ordered.

22

APPENDIX
---------------------

Petition for Order No

DISTRICT COURT OF THE UNITED STATES
FOR THE DISTRICT OF MASSACHUSETTS
In Proceedings for the Reorganization of a Railroad
----------------------------------------------------------------------------------------------------In the Matter of
)
BOSTON AND MAINE
)
No. 70-250-F
CORPORATION
Debtor )
--------------------------PETITION OF TRUSTEES FOR CONFIRMATION OF
THE APPOINTMENT OF SPECIAL COUNSEL
IN THE FIELD OF TORT CLAIMS
--------------------------------------------------------------------------Now come Robert W. Meserve, Paul W. Cherington, and Charles W.

Bartlett, the Trustees of the Debtor's property, and respectfully represe

to the Court:
1. That they deem it advisable, in addition to the legal staff of the
Debtor, to appoint Special Counsel to represent their interest in the
preparation and trial of negligence cases and to supervise the settlement
personal injury and death claims.
2. Prior to the appointment of Trustees the Debtor had retained for the
purposes the following atorneys and/or firms:
John Russell
Walter F. Henneberry
73 Tremont Street
Hale, Sanderson,
Boston, Massachusetts
Byrnes & Morton
10 Post Office Square
Boston, Massachusetts
Robert O'Leary
Lawrence R. Cohen
11 Beacon Street
McCormack, Elcock,
Cohen & Matera
19 Congress Street
Boston, Massachusetts
Docket No. 287 (handwritten)
Filed- April 21, 1971 (handwrit
Joseph J. Mulhern, Jr.
Robert Crowley
Mulhern & Mulhern
1 Court Street
15 Court Square
Boston, Massachusetts
Boston, Massachusetts
Joseph L. Tauro
Stephen A. Moynahan
Jaffee & Tauro
1387 Main Street
1 Center Plaza
Springfield,
Boston, Massachusetts
Massachusetts
Pierce, Atwood,
Henry F. Black
Scribner, Allen & McKusick
Black & Plante
465 Congress Street
Municipal Building
Portland, Maine
White River Jct., Verm
Donald P. Bryant
William Phinney
Burns, Bryant & Hinchey
Sheehan, Phinney,
Bucabrey Building
Bass & Green
Dover, New Hampshire
Amoskeag Bank Building
Manchester, New Hampsh
Walter D. Hinckley
Earl H. Gallup, Jr.
Hinckley & Donovan
McNamee, Nichols,
Lancaster, New Hampshire
Lochner & Titus
75 State Street
Albany, New York 12207
Michael J. Kenny
60 East 42nd Street
New York, New York
3. Petitioners have appointed, subject to the approval of this Court, a
Special Counsel for these purposes the attorneys and/or firms listed in
Paragraph Two.
4. Petitioners believe that said counsel are eminently qualified to per
such services for your Petitioners due to counsel's experience and their
background in this field, as well as their past association with the Debt
Petitioners further believe that the best interests of the present estate
the Debtor will be served by continuity of counsel in the matters involve
the proposed appointments.

5. It is proposed that said counsel be compenstated for their services

the preparation, trial and/or settlement of such cases in accordance with
general standard of compensation to attorneys for like services in the ar
in which they will perform such services, subject to the approval of this
Court.
6. To the best of Petitioners' knowledge, based on special review of th
facts and representations of said attorneys. Petitioners are satisfied t
said attorneys represent no interest adverse to Petitioners or to the Tru
Estate in the aforesaid matters upon which said special counsel are to be
engaged; and
7. In the event of the employment of said Counsel as proposed herein, t
services to be rendered to the Trustees by said Special Counsel represent
services that would have been required absent reorganization. Said servi
will not be rendered in or in connection with the present proceeding for
reorganization of the Debtor or any plan for the reorganization of the De
in such proceeding. Under these circumstances, Petitioners are informed
counsel, and they therefore allege that any payments to be made to said
Special Counsel for their services as proposed herein will be such to the
approval of this Court without necessity for the fixing of any maximum li
by the I.C.C. pursuant to Section 77 of the Bankruptcy Act.
WHEREFORE, Petitioners pray that orders be entered herein:
1. Approving the appointment by Petitioners of those attorneys and/or f
listed in Paragraph Two as Special Counsel for the purposes set within
Paragraph One hereof; and
2. Authorizing Petitioners to compensate said Special Counsel for their
services, and to reimburse said Special Counsel for their expenses in
connection therewith, from the Debtor's Estate in such amounts as may be
approved herafter by the Court as reasonable.
Robert W. Meserve, Pau
Cherington, and Charle
Bartlett as
Trustees of the proper
of Boston and
Maine Corporation, Deb
By /s/(signature)
---------------------------------------------Trustees
ORDER NO
DISTRICT COURT OF THE UNITED STATES
FOR THE DISTRICT OF MASSACHUSETTS
In Proceedings for the Reorganization of a Railroad
----------------------------------------------------------------------------------------------------In the Matter of
)
BOSTON AND MAINE
)
No. 70-250-F
CORPORATION
Debtor )
--------------------------ORDER CONFIRMING APPOINTMENT OF SPECIAL COUNSEL
IN THE FIELD OF TORT CLAIMS
--------------------------------------------------------------------------The verified petition of the Trustees of the property of the Debtor for
confirmation of their appointment of Special Counsel in the field of tort
claims having come on for hearing on May 3, 1971, duly noticed pursuant t

the order of this Court, and the parties in interest having been heard or
given an opportunity to be heard, and the Court being duly advised in the
premises, and the Court being satisfied that the Counsel proposed in said
petition represent no interest adverse to said Trustees or to the trust
estate in the matters upon which they are to be engaged, that their
employment is to the best interests of the trust estate, and that the fix
by the Interstate Commerce Commission of a maximum limit of allowance as
compensation for the ervices of said Counsel is not required under the
provisions of Section 77 of the Bankruptcy Act, it is
ORDERED, ADJUDGED and DECREED:
1. That the appointment by the Trustees of the Special Counsel as liste
paragraph 2, of the Trustee's petition (Docket No. 287) be and hereby is
confirmed;
Docket No. 294
ENTERED-May 3, 1971
2. That the Trustees be and they hereby are authorized to compensate sa
Special Counsel for their services, and to reimburse the said Counsel for
their expenses in connection therewith, for the period commencing March 1
1970, from the Debtor's estate, in such amounts as may be approved by the
Court as reasonable.
WITNESS, the Honorable Francis J. W. Ford, Judge of said Court, and the
seal thereof, at Boston, in said District, this 3d day of May, 1971.
s/ Austin W. Jones, Jr.
---------------------------------------------Deputy Clerk
Enter:
s/FORD, J.
A TRUE COPY ATTEST:
May 3-71
/s/ signature
DEPUTY CLERK
Order No.
DISTRICT COURT OF THE UNITED STATES
FOR THE DISTRICT OF MASSACHUSETTS
In Proceedings for the Reorganization of a Railroad
----------------------------------------------------------------------------------------------------In the Matter of
)
BOSTON AND MAINE
)
No. 70-250-F
CORPORATION
Debtor )
--------------------------ORDER AUTHORIZING TRUSTEES TO APPOINT AND
SUBSTITUTE SPECIAL COUNSEL IN THE
FIELD OF TORT CLAIMS
--------------------------------------------------------------------------The petition of the Trustees of the property of the Debtor for authorit
appoint and substitute Special Counsel in the field of tort claims having
come on for hearing on March 27, 1972, duly noticed pursuant to the order
this Court, and the parties in interest having been heard or given an
opportunity to be heard, and the Court being duly advised in the premises
is
ORDERED, ADJUDGED and DECREED:
1. That the Trustees be, and they hereby are, authorized to appoint and
substitute additional Special Counsel in the field of tort claims;
2. That the Trustees be, and they hereby are, authorized to pay or sati

bills from said additional Special Counsel, in amounts of less than $5,00
WITNESS, the Honorable Francis J. W. Ford, Judge of said Court, and the
seal thereof, at Boston, in said District, this 27 day of March, 1972.
s/ Austin W. Jones, Jr.
---------------------------------------------Deputy Clerk
Enter:
s/FORD, J.
A TRUE COPY ATTEST:
/s/ signature
DEPUTY CLERK
DOCKET NO. 551
ENTERED MARCH 27, 1972
--------------------------------------------------------------------------Petition for Order No.
DISTRICT COURT OF THE UNITED STATES
FOR THE DISTRICT OF MASSACHUSETTS
In Proceedings for the Reorganization of a Railroad
----------------------------------------------------------------------------------------------------In the Matter of
)
BOSTON AND MAINE
)
No. 70-250-F
CORPORATION
Debtor )
--------------------------PETITION OF TRUSTEES FOR AUTHORITY TO APPOINT AND
SUBSTITUTE SPECIAL COUNSEL FOR EMINENT DOMAIN
PROCEEDINGS AND FOR OTHER LITIGATION PURPOSES
--------------------------------------------------------------------------Now come Robert W. Meserve and Charles W. Bartlett, the Trustees of the
Debtor's property, and respectfully represent to the Court:
1. By Orders No. 28, 64, 65 and 65-A (Docket Nos. 90, 292, 294 and 504)
previously entered herein, your Trustees have been authorized to appoint
Special Counsel in the areas of arbitration, tort claims and creditor's
rights;
2. The Trustees, in operating the Debtor's business, are regularly requ
to retain or employ Special Counsel to represent the Debtor's interests i
eminent domain proceedings and other types of court and administrative
proceedings;
3. The Trustees have appointed, subject to the approval of this Court,
Special Counsel for these purposes the following attorneys:
Paul K. Marshall, Esq.
Thomas D. Burns, Esq
1 Center Plaza
45 School Street
Boston, Massachusetts
Boston,
MassachusettsB
The Trustees are of the opinion that said counsel are eminently qualified
perform such services for your Petitioners due to your Petitioners due to
counsels' experience and their background in these fields. Petitioners
further believe that the best interests of the present estate of the Debt
will be served by these proposed appointments.
4. In the ordinary course of the Debtor's business, additional Special
Counsel for these purposes will regularly be needed. The Trustees believ
that presentation of separate petitions for authorty to appoint or substi
such Special Counsel would unnecessarily delay or burden the Court;
5. The Trustees are of the opinion that it is in the best interests of
Debtor's estate that they be empowered, in their discretion, to appoint o

substitute additional Special Counsel to represent the Debtor's interests

eminent domain proceedings and other types of court and administrative
litigation;
6. That the services described above are such that they would have been
required absent reorganization. Said services have not been, and will no
rendered in or in connection with the present proceeding for the
reorganization of the Debtor on any plan of reorganization of the Debtor
such proceeding. Any payments to be made to said Special Counsel for the
services as proposed herein will be such as not to require the fixing of
maximum limits by the I.C.C. pursuant to Section 77 of the Bankruptcy Act
7. The Trustees anticipate that, in the ordinary course of the Debtor's
business, numerous bills from said Special Counsel will be received, that
presentation of separate petitions for authority to pay or satisfy such b
would unnecessarily delay and burden the Court, and that they should be
authorized, in their discretion, to pay or satisfy bills for amounts of l
than $5,000. without further orders from the Court, but that approval of
Court should be required for payment of bills for amounts in excess of
$5,000.
WHEREFORE, your Petitioners pray that orders be entered herein:
1. Authorizing the Trustees to appoint or substitute Special Counsel to
represent the Debtor's interesst in eminent domain proceedings and other
types of court and administrative lititgation;
2. Authorizing the Trustees, in their discretion, to pay or satisfy bil
from said Special Counsel for amounts of less than $5,000;
3. Granting such other and further relief as the Court may deem
appropriate.
Robert W. Meserve and
Charles W. Bartlett,
Trustees
of the property of Bos
and Maine Corporation,
Debtor
By: /s/ signature
---------------------------------------------One of the Trustees
VERIFICATION
--------------------------------------------------------------------------Commonwealth of Massachusetts
February 25,
Suffolk,
Then personally appeared before me the above Charles W. Bartlett who, b
duly sworn, deposes and says that he is a Trustee of the property of Bost
and Maine Corporation, Debtor, and is duly authorized by his fellow Trust
to make the above petition on behalf of both said Trustees, and that the
statements contained in said petition are true to the best of his knowled
information and belief.
Before me,
/s/ signature
----------------------Notary Public
My commission expires September 15, 1978
Order No.
DISTRICT COURT OF THE UNITED STATES
FOR THE DISTRICT OF MASSACHUSETTS
In Proceedings for the Reorganization of a Railroad
---------------------------------------------------------------------------

--------------------------In the Matter of

)
BOSTON AND MAINE
)
No. 70-250-F
CORPORATION
Debtor )
--------------------------ORDER AUTHORIZING THE TRUSTEES TO APPOINT AND
SUBSTITUTE SPECIAL COUNSEL FOR EMINENT DOMAIN
PROCEEDINGS AND OTHER LITIGATION PURPOSES
--------------------------------------------------------------------------The petition of the Trustees of the property of the Debtor for authorit
appoint and substitute Special Counsel for eminent domain proceedings and
other litigation purposes having come on for hearing on March 27, 1972, d
noticed pursuant to the order of this Court and the parties in interest
having been heard, and the Court being duly advised in the premises, it i
ORDERED, ADJUDGED and DECREED:
1. That the Trustees be, and they hereby are, authorized to appoint and
substitute Special Counsel to represent the Debtor's interests in eminent
domain proceedings and other types of court and adminstrative litigation;
2. That the Trustees be, and they hereby are, authorized, in their
discretion, to pay or satisfy bills from said Special Counsel for amounts
less than $5,000.
WITNESS, the Honorable Francis J. W. Ford, Judge of said Court, and the
seal thereof, at Boston, this 27 day of March, 1972.
s/ Austin W. Jones, J
----------------------Enter:
Deputy Clerk
s/FORD, J.
A TRUE COPY ATTEST:
/s/ signature
DEPUTY CLERK
DOCKET NO. 556 - ENTERED MARCH 27, 1972
-------------------------------------------------Petition for Order No.
DISTRICT COURT OF THE UNITED STATES
FOR THE DISTRICT OF MASSACHUSETTS
--------------------------------------------------------------------------In Proceedings for the Reorganization of a Railroad
----------------------------------------------------------------------------------------------------In the Matter of
)
BOSTON AND MAINE
)
No. 70-250-M
CORPORATION
Debtor )
--------------------------PETITION OF TRUSTEES FOR AUTHORITY TO
ENTER INTO ARBITRATION PROCEEDINGS
AND TO RETAIN COUNSEL
Now come Robert W. Meserve and Benjamin H. Lacy, the Trustees of the
Debtor's property,and respectfully represent to the Court:
1. Over the last two years, the Trustees have negotiated with the labor
organizations representing employees of the railroad with respect to wage
from January 1, 1978, and changes in certain work rules.
3. Granting such other and further relief as this Court may deem
appropriate.

Robert W. Meserve and

Benjamin H. Lacy,
as Trustees of the
Property of
BOSTON and MAINE
CORPORATION, DEBTOR
By: /s/ signature
---------------------------------------------One of the Trustees

DATED: January 30, 1980

The B & M reorganization proceedings commenced in 1970. A final plan of

reorganization became effective on June 30, 1983. The proceedings are
governed by section 77, Chapter VIII of the Bankruptcy Act. The railroad is
now once again in private hands, the reorganization having been successful.
The legal services for which petitioners seek compensation were mostly done in
1980 or earlier years, although some of the work was in 1981 and was ongoing
in 1982

One estimate is that 97 actions, on average, are filed annually against the B &
M. Many of these are personal injury and FELA claims. There have also been
numerous eminent domain proceedings, involving takings of the railroad's
extensive land holdings including two lines in New Hampshire; tax
proceedings; and extensive labor matters, including a critical labor arbitration

In the case of petitioner Moore reliance is also placed on Order No. 522. See
Appendix

Even in an area as strictly construed as the timeliness of a notice of appeal,

courts have excused technical violations where counsel acted in reasonable
reliance upon a judge's erroneous statement. Textor v. Board of Regents, 711
F.2d 1387 (7th Cir.1983)

In so saying we reiterate that we are not to be understood as ruling whether or

not retroactive authorization could be appropriate in a more conventional
bankruptcy setting, or in the absence of prior judicial authorization such as
existed here

In In re J.M. Wells, Inc., 575 F.2d 329, 331-32 n. 2 (1st Cir.1978), we cited
Beecher v. Leavenworth State Bank, 184 F.2d 498, 501 (9th Cir.1950) (denying
compensation for legal services rendered prior to compliance with General
Order 44) and, in the context of a receiver (and, later, trustee) who had
employed himself as attorney, expressed disapproval that compensation for

services rendered prior to court approval of the receiver/trustee's appointment

as attorney were sought and possibly allowed. The facts of these cases seem to
us quite distinguishable, but we nonetheless appreciate the court's concern
about any apparent departure from the strict rules that prevail in this area