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Samuel Morreale v. United States Bankruptcy Court for the District of Colorado, 18-63 (2019)

Court: Bankruptcy Appellate Panel of the Tenth Circuit Number: 18-63 Visitors: 10
Filed: Jan. 22, 2019
Latest Update: Mar. 03, 2020
Summary: Before NUGENT, Chief Judge, MICHAEL, and SOMERS, Bankruptcy Judges. Debtors, Objection to First Interim Application of Tom Connolly, Chapter 7 Trustee, for, Allowance of Compensation and Expenses (Objection), in Appellants App.debtor under a court order.the MHLLC Chapter 11 case.
                                                                                      FILED
                                                                            U.S. Bankruptcy Appellate Panel
                                                                                  of the Tenth Circuit

                                                                               January 22, 2019

                                      PUBLISH                                   Blaine F. Bates
                                                                                    Clerk
            UNITED STATES BANKRUPTCY APPELLATE PANEL
                            OF THE TENTH CIRCUIT
                       _________________________________

 IN RE SAMUEL JESSE CHRISTIAN                          BAP No. CO-18-063
 MORREALE,

            Debtor.
 _____________________________
                                                       Bankr. No. 13-27310
 TOM H. CONNOLLY,                                          Chapter 7

             Appellant,
 v.
                                                             OPINION
 OFFICE OF THE UNITED STATES
 TRUSTEE and SAMUEL JESSE
 CHRISTIAN MORREALE,

             Appellees.
                      _________________________________

                   Appeal from the United States Bankruptcy Court
                             for the District of Colorado
                      _________________________________

Michael Panko (Andrew J. Roth-Moore with him on the brief) of Brownstein Hyatt
Farber Schreck, LLP, Denver, Colorado for the Appellant.

Jordan Factor (Matthew M. Wolf with him on the brief) of Allen Vellone Wolf Helfrich
& Factor P.C., Denver, Colorado for the Appellee.
                       _________________________________

Before NUGENT, Chief Judge, MICHAEL, and SOMERS, Bankruptcy Judges.
                   _________________________________

NUGENT, Chief Judge.
                    _________________________________
      11 U.S.C. § 326(a)1 limits the maximum commission to be paid to a Chapter 7

trustee to a percentage of the moneys disbursed or turned over “in the case.”2 Appellee

Morreale’s individual Chapter 7 trustee asked to be paid commissions based on his

disbursements, not only in Morreale’s individual Chapter 7 case, but also in Morreale’s

single-member limited liability company’s Chapter 11 case. The parties agreed that the

only legal issue was whether the Chapter 11 disbursements had been made “in the

[Chapter 7] case”3 and could be included in the commission base before applying

§ 326(a)’s graduated commission formula. Applying the plain language of § 326(a) in a

straightforward manner, the bankruptcy court concluded that the section is unambiguous,

that the Chapter 11 disbursements were not part of the Chapter 7 disbursement base, and

that the Chapter 7 trustee could not be paid a commission based upon the Chapter 11

disbursements. We agree and AFFIRM.

      Facts

      We adopt the bankruptcy court’s factual statement, summarized as follows.

Samuel Morreale (“Morreale”) organized, owned, and managed a single-member limited

liability company, Morreale Hotels, LLC (“MHLLC” or “LLC”), that acquired,

renovated, and operated two properties in Denver. MHLLC filed a Chapter 11 petition in

December of 2012. Morreale filed an individual Chapter 11 case in October of 2013 that




      1
         All future references to “Code,” “Section,” and “§” are to the Bankruptcy Code,
Title 11 of the United States Code, unless otherwise indicated.
       2
         11 U.S.C § 326(a).
       3
         
Id. 2 was
converted to Chapter 7 in late 2014.4 Appellant Tom Connolly (“Connolly”) was

appointed Chapter 7 trustee in Morreale’s individual case; 5 the Chapter 7 estate included

Morreale’s interest in MHLLC. Connolly obtained an order in MHLLC’s Chapter 11

case substituting himself for Morreale as manager of MHLLC and authorizing him to

manage and operate the business of MHLLC (“Operating Order”).6 Upon gaining control

of MHLLC, Connolly abandoned MHLLC’s plan of reorganization and ultimately

proposed a plan of liquidation after seeking and obtaining bankruptcy court approval to

sell the MHLLC properties.7 Acting as MHLLC’s manager, Connolly sold the two

properties in MHLLC’s Chapter 11 case and disbursed the proceeds of those sales to

MHLLC’s secured and unsecured creditors. Surplus funds were paid to Morreale’s

Chapter 7 estate. Neither the Operating Order, the confirmed amended Chapter 11 plan of

liquidation, nor the sale motions filed in MHLLC’s Chapter 11 case addressed whether

Connolly would be compensated in connection with the MHLLC sales.8 Nor did

Connolly seek appointment as a Chapter 11 trustee or a professional in the Chapter 11



       4
          Judgment, in Appellant’s App. at 130.
       5
          Notice of Appointment of Interim Trustee in Appellant’s App. at 131.
        6
          Motion to Approve Change in Management of the Debtor [MHLCC], in
Appellant’s App. at 600; Minute Order dated April 21, 2015 at 2, in Appellant’s App. at
647.
        7
          Chapter 11 Plan dated January 8, 2016, in Appellee’s App. at 81; Amended
Chapter 11 Plan dated January 8, 2016 [sic], in Appellee’s App. at 95.
        8
          We note that the initial Chapter 11 plan of liquidation provided for Connolly to
be compensated for his services as manager of MHLCC, but after the United States
Trustee objected, that compensation provision was withdrawn from the amended Chapter
11 plan. Compare Chapter 11 Plan at 6, ¶ 5.2.c., in Appellee’s App. at 86 with Amended
Chapter 11 Plan at 6, ¶ 5.2.c., in Appellee’s App. at 100 (“This subsection intentionally
left blank.”).
                                                3
case. When he filed his Application requesting to be paid commissions in the Chapter 7

case based upon disbursements made in both cases, Morreale objected.9 Because the

Chapter 7 estate also contained more funds than necessary to pay all its creditors,

Morreale claimed an interest in the surplus. Morreale asserted that under § 326(a)’s

formula, Connolly should only be granted a commission on disbursements made in the

Chapter 7 case. Connolly responded that because his actions in MHLLC’s Chapter 11

case benefitted the Chapter 7 estate, he should receive § 326(a) commissions on what he

disbursed in the Chapter 11 case. No evidence was presented at the bankruptcy court

hearing on the Application and the parties agreed that the sole issue before the

bankruptcy court was whether § 326(a) included the Chapter 11 disbursements in the

Chapter 7 commission base, for purposes of calculating his compensation as Chapter 7

trustee.10 The bankruptcy court concluded it did not and denied Connolly a commission

on the Chapter 11 disbursements.11 This appeal followed.

       Jurisdiction

       This is an appeal from the bankruptcy court’s Compensation Order denying

Connolly’s request for additional compensation based on disbursements made in the


       9
         First Interim Application of Tom Connolly, Chapter 7 Trustee, for Allowance of
Compensation and Expenses (“Application”), in Appellant’s App. at 281; Debtor’s
Objection to First Interim Application of Tom Connolly, Chapter 7 Trustee, for
Allowance of Compensation and Expenses (“Objection”), in Appellant’s App. at 316.
       10
          Tr. of Non-Evidentiary Hearing on First Interim Application of Tom Connolly,
Chapter 7 Trustee and Debtor’s Objection held on Aug. 17, 2017, in Appellant’s App. at
502, 505, 520-22, 552.
       11
          Supplemental Order on Trustee’s First Interim Application of Tom Connolly,
Chapter 7 Trustee, for Allowance of Compensation and Expenses (“Compensation
Order”), in Appellant’s App. at 381.
                                                4
Chapter 11 case of MHLLC.12 The motions panel granted the Trustee’s Motion for Leave

to Appeal Compensation Order,13 determining that the interlocutory appeal involved a

controlling question of law to which there is substantial ground for difference of opinion

and that an immediate resolution of the compensation issue may materially advance

disposition of the Chapter 7 bankruptcy case.14 We agree and find that this Court has

jurisdiction under 28 U.S.C. § 158(a)(3).

       Standard of Review

       The parties presented no relevant disputed facts that require our review.15 We

review the bankruptcy court’s interpretation of § 326(a) as a question of law de novo.16

       Analysis



       12
           
Id. at Appellant’s
App. at 381.
       13
           Appellant’s App. at 398; BAP ECF No. 3.
        14
           Order Granting Leave to Appeal at 2, BAP ECF No. 9.
        15
           Before we reach the merits of the appeal, we consider Morreale’s unopposed
motion to supplement the record on appeal previously referred to the merits panel. See
BAP ECF No. 25. He requests that we supplement the record with the Joint Status Report
on Debtor’s Motion for Partial Interim Disbursement of Surplus Estate Funds (the “Joint
Status Report”) filed by the parties in this appeal, and with the transcript of the
confirmation hearing in the MHLLC case. See BAP ECF No. 22. Neither of these
documents bear on our interpretation of § 326(a), the legal issue before us. The Joint
Status Report was filed after the bankruptcy court issued its Compensation Order and
likely not considered by that court in reaching its decision. The MHLLC confirmation
hearing transcript likewise sheds no light on the pure legal issue before us. Morreale’s
motion to supplement the record is DENIED.
        16
           Dalton v. I.R.S., 
77 F.3d 1297
, 1299 (10th Cir. 1996) (citing Murray v.
Montrose Cty. Sch. Dist. RE-1J, 
51 F.3d 921
, 928 (10th Cir. 1995)); In re BDT Farms,
Inc., 
21 F.3d 1019
, 1021 (10th Cir. 1994) (citing FDIC v. Lowery, 
12 F.3d 995
, 966 (10th
Cir. 1993)). See also In re JFK Capital Holdings, L.L.C., 
880 F.3d 747
, 751 (5th Cir.
2018) (reviewing an award of Chapter 7 trustee fees for abuse of discretion; an abuse of
discretion occurs if the bankruptcy court “applies an improper legal standard [, reviewed
de novo,] or follows improper procedures in calculating the fee award.”).
                                                5
       We begin with the general statute governing compensation of trustees and

professional persons, § 330(a)(1). When applicable, the amount of reasonable

compensation of such persons is determined by considering “the nature, the extent, and

the value of such services,”17 accounting for the factors enumerated in § 330(a)(3). But

§ 330 expressly removes the determination of a Chapter 7 trustee’s reasonable

compensation from the factors’ analysis by making it “subject to section[ ] 326”18 and

omitting Chapter 7 trustees from the persons whose reasonable compensation is

determined by the § 330(a)(3) factors.19

       Section 326(a) caps the maximum compensation a Chapter 7 trustee can receive in

a case by establishing a multi-tiered commission formula for calculating a Chapter 7

trustee’s reasonable compensation. The subsection provides:

               In a case under chapter 7 or 11, the court may allow reasonable
       compensation under section 330 of this title of the trustee for the trustee’s
       services, payable after the trustee renders such services, not to exceed 25
       percent on the first $5,000 or less, 10 percent on any amount in excess of
       $5,000 but not in excess of $50,000, 5 percent on any amount in excess of
       $50,000 but not in excess of $1,000,000, and reasonable compensation not
       to exceed 3 percent of such moneys in excess of $1,000,000, upon all moneys
       disbursed or turned over in the case by the trustee to parties in interest,
       excluding the debtor, but including holders of secured claims.20




       17
          11 U.S.C. § 330(a)(3).
       18
          11 U.S.C. § 330(a)(1). See In re Salgado-Nava, 
473 B.R. 911
, 921 (9th Cir.
BAP 2012) (noting Congress removed Chapter 7 trustee fees from § 330’s reasonableness
factors and set commission rates for trustees in § 326).
       19
          11 U.S.C. § 330(a)(3) (determining “amount of reasonable compensation to be
awarded to an examiner, trustee under chapter 11, or professional person”).
       20
          11 U.S.C. § 326(a) (emphasis added).
                                                6
In addition to § 326(a), Congress added subsection (a)(7) to § 330 when it enacted the

Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.21 That section

requires Chapter 7 trustee compensation to be calculated under § 326(a):

               In determining the amount of reasonable compensation to be awarded
       to a trustee, the court shall treat such compensation as a commission, based
       on section 326.22

       Some courts that have considered the interplay between § 326(a) and § 330(a)(7)

have concluded that a Chapter 7 trustee’s commission calculated under § 326(a)

establishes a presumptively reasonable trustee fee.23 Section 330(a)(2) gives the

bankruptcy court discretion to award less compensation than the amount sought where

extraordinary circumstances exist (but not more).24 Nothing in these fee statutes

authorizes bankruptcy courts to award more than § 326(a)’s maximum compensation to




       21
           BAPCPA, Pub. L. 109-8, § 407, 119 Stat. 23 (2005).
       22
           11 U.S.C. § 330(a)(7) (emphasis added).
        23
           See In re JFK Capital Holdings, L.L.C., 
880 F.3d 747
, 753 (5th Cir. 2018)
(concluding § 326’s percentage amounts are presumptively reasonable compensation for
Chapter 7 trustee fees); In re Rowe, 
750 F.3d 392
, 398-99 (4th Cir. 2014) (requiring
Chapter 7 trustee fees to be calculated on the commission rates provided in § 326(a) and
determining them presumptively reasonable, absent extraordinary circumstances); In re
Salgado-Nava, 473 B.R. at 921
(noting Congress would not have set commission rates
for Chapter 7 trustees, and removed Chapter 7 trustee compensation from § 330’s
reasonableness factors, unless it generally considered the commission rate reasonable); In
re Turner Grain Merch., Inc., 
568 B.R. 96
, 102 (Bankr. E.D. Ark. 2017) (characterizing
the “trending view” of § 330(a)(7) and § 326(a)).
        24
           In re 
Rowe, 750 F.3d at 398
. See also 3 Collier on Bankruptcy ¶ 326.02[1][a]
(Richard Levin and Henry J. Sommer eds., 16th ed. rev. 2015) (For cases filed after
BAPCPA, the reasonableness factors in § 330 may be considered in determining whether
extraordinary circumstances exist that warrant a downward departure from § 326(a)’s
statutory cap).
                                                7
Chapter 7 trustees.25 The issue here is whether the bankruptcy court correctly interpreted

and applied § 326(a) in determining Connolly’s compensation for services rendered as

trustee in Morreale’s Chapter 7 case.

       Because this appeal presents an issue of statutory interpretation, we look first to

the language of § 326(a) to ascertain whether the language is plain and unambiguous.26 If

it is, the inquiry ends, and those plain terms must be applied as written.27 The parties and

the bankruptcy court considered the meaning of the phrase “in the case” in § 326(a) to be

the key dispute. That phrase is not defined in the Bankruptcy Code, but its meaning here

is critical to determining the amount of the base to which § 326(a)’s tiered commission

rates are applied.28 Connolly suggests that “in the case” only relates to the words “turned

over,” and not “moneys disbursed.”29 He contends that the base may include amounts

disbursed in other, separate cases such as MHLLC’s Chapter 11 case where his services

benefited the Chapter 7 estate. We disagree. Not only does that interpretation insert

words into the statute that simply aren’t there, but it also collides with our understanding

of grammar. The word “or” is a coordinating conjunction used to “join clauses of equal

stature.”30 Here, “or” conjoins two concepts—disbursement and turnover—that describe




       25
          3 Collier on Bankruptcy ¶ 326.02[d] (courts lack discretion to award
compensation in excess of what § 326(a) allows).
       26
          United States v. Ron Pair Enters., Inc., 
489 U.S. 235
, 241 (1989).
       27
          Lamie v. U.S. Trustee, 
540 U.S. 526
, 534 (2004).
       28
          Hamilton v. Lanning, 
560 U.S. 505
, 513 (2010) (giving undefined statutory
terms their ordinary meaning).
       29
          11 U.S.C. § 326(a).
       30
          See Bryan A. Garner, The Redbook: A Manual on Legal Style ¶ 10.46 (2002).
                                                 8
kinds of disposition and are, in that respect, two similar elements. In § 326(a), both are

related to and modified by the words “in the case.”31

       The larger phrase “upon all moneys disbursed or turned over in the case” is

prepositional: the preposition “upon” relates the concept of “all moneys disbursed or

turned over in the case” to the “reasonable compensation” the court may allow a trustee,

“payable” as calculated using the sliding scale.32 Within that prepositional phrase is

another, “in the case.” The preposition “in” relates the “all moneys disbursed or turned

over” concept to “the case.” Thus, this single-sentence subsection essentially means that a

Chapter 7 or 11 trustee receives as compensation a certain percentage of funds he or she

receives and pays out in the Chapter 7 or 11 case. It is not ambiguous.

       Our reading of § 326(a) is not just cabined by our reading of the isolated phrase

“in the case.”33 Section 326(a) contains other language indicating that the Chapter 7

trustee’s compensation is confined to the case in which he was appointed. Section 326(a)

limits trustee compensation, not that of an individual acting as a manager or professional

in a Chapter 11 case. That person’s compensation is governed by §§ 328 and 330.

Subsection 326(a) begins “[i]n a case under chapter 7 or 11”34 and ends with


       31
           See Antonin Scalia & Bryan A. Garner, Reading Law: The Interpretation of
Legal Texts 147-151 (2012) (discussing prepositive and postpositive modifiers of a series
of nouns or verbs).
        32
           Garner, supra note 30, ¶ 10.42 (“A preposition is so called because it is usually
positioned before a noun, pronoun, or nominative phrase or clause and relates its subject
to another word in the sentence.”).
        33
           King v. Burwell, 576 U.S. ___, 
135 S. Ct. 2480
, 2489 (2015) (courts “construe
statutes, not isolated provisions” and therefore, must read a phrase in its context and place
in the overall statutory scheme).
        34
           11 U.S.C § 326(a) (emphasis added).
                                                 9
compensation calculated upon all moneys disbursed by the trustee “in the case,”35 thus

speaking to compensation in the single case in which a trustee is appointed. Certainly, “a

case” and “the case” refer to the same case. To receive compensation in a case under

§ 326(a), Connolly must be a Chapter 7 trustee or a Chapter 11 trustee. His compensation

must be for performance of “trustee’s services” in “the case.”36 Here, as trustee in the

Chapter 7 case, Connolly’s compensation is based upon the amounts he disbursed or

turned over in the Chapter 7 case. As we discuss below, not having been appointed in the

Chapter 11 case, Connolly cannot receive commission compensation for his services in

that case.

       The bankruptcy court further examined the “in the case” phrase in the broader

context of the Bankruptcy Code to support its interpretation of § 326. It correctly noted in

its Compensation Order other provisions in the Bankruptcy Code indicating that “the

case” refers to a single, specific bankruptcy case commenced by filing a petition.37 The

bankruptcy court further cited other Code sections specific to Chapter 7 indicating that

“in the case,” refers to the case in which the trustee was appointed and serves.38 We agree

with the bankruptcy court’s analysis of these statutory provisions.




       35
          
Id. (emphasis added).
       36
          
Id. 37 Compensation
Order at 11, in Appellant’s App. at 391. See 11 U.S.C.
§§ 101(42), 301-303.
       38
          Compensation Order at 11, in Appellant’s App. at 391. See 11 U.S.C.
§ 701(a)(1) (appointment of interim trustee “in the case”); § 702(b) and (d) (interim
trustee serves as trustee “in the case” if a trustee is not elected to serve as trustee “in the
case”); § 703 (successor trustee appointed “in the case”).
                                                   10
       Nothing in § 326(a) or § 330(a)(7) speaks to additionally compensating a Chapter

7 trustee who is simultaneously acting as a manager of a separate or related Chapter 11

debtor under a court order. Connolly acted as manager of MHLLC, not its trustee, when

he secured bankruptcy court approval to manage MHLLC and sell the MHLLC

properties. It is true that Morreale’s Chapter 7 estate included his single-member interest

in MHLLC. It is also true that, as Morreale’s Chapter 7 trustee, Connolly succeeded to

that interest.39 That positioned him to control and manage the LLC and its assets, but that

did not bring MHLLC’s property into Morreale’s Chapter 7 estate. As a matter of general

limited liability company law, Morreale’s interest in the LLC did not entitle him to

possession of its assets.40 Just as Morreale and MHLLC are distinct legal entities, so are

their respective bankruptcy estates.41 Any moneys disbursed to MHLLC creditors as a

result of the sales in MHLLC’s Chapter 11 case were distributed by Connolly as




       39
          In re B&M Land and Livestock, LLC, 
498 B.R. 262
, 266 (Bankr. D. Nev. 2013)
(Chapter 7 trustee controls single-member limited liability company owned by Chapter 7
debtor, automatically including the right to manage the entity); In re Albright, 
291 B.R. 538
, 540-41 (Bankr. D. Colo. 2003) (Debtor’s 100% interest in limited liability company
on date of Chapter 7 filing is personal property of debtor becoming property of the estate;
trustee obtains all of debtor’s rights, including right to control management of the LLC).
       40
          Under Colorado law, for instance, a member’s interest in a limited liability
company constitutes personal property of the member; that membership interest entitles
the member to share in profits (and losses) of the LLC and distributions of the LLC’s
assets according to the value of the member’s contributions. Colo. Rev. Stat. Ann. § 7-
80-702(1), -503, to -504 (2018).
       41
          An individual and a corporate entity are both persons who may be bankruptcy
debtors, but they may not be joint debtors in the same case. See 11 U.S.C. § 101(13)
(defining a “debtor”) and § 101(41) (defining “person”) and § 302 (authorizing a joint
case only by an individual debtor and debtor’s spouse).
                                                11
MHLLC’s manager, not as Chapter 7 trustee. What he disbursed in MHLLC’s Chapter 11

case cannot be included in his § 326(a) trustee compensation base.42

       Connolly’s actions in the Chapter 11 case, however valuable, were voluntary.

While his work undoubtedly benefitted the Chapter 11 as well as the Chapter 7 estates,

and by all accounts he devoted substantial hours to managing MHLLC, Connolly was not

employed or appointed in the Chapter 11 case as a § 327 professional, nor was he the

Chapter 11 trustee.43 The Tenth Circuit’s case law in this regard is as unforgiving as it is

crystal clear: Absent court approval of an individual’s employment as a professional or

Chapter 11 trustee, the individual is a volunteer and is entitled to no compensation from




       42
         The Court is mindful of its limited role in interpreting a statute. As the Supreme
Court stated in Lamie v. U.S. Trustee, addressing compensation of attorneys for Chapter 7
debtors and limiting compensation from the bankruptcy estate:

       Our unwillingness to soften the import of Congress’ chosen words even if we
       believe the words lead to a harsh outcome is longstanding. It results from
       deference to the supremacy of the Legislature . . . .

       ....

       If Congress enacted into law something different from what it intended, then it
       should amend the statute to conform it to its intent. It is beyond our province to
       rescue Congress from its drafting errors, and to provide for what we might think . .
       . is the preferred result.

540 U.S. 526
, 542 (2004) (citations omitted) (internal quotation marks omitted).
       43
          Had Connolly been appointed a professional in the Chapter 11 case, his
compensation would have been determined by considering the § 330(a)(3) factors with
due consideration given to the time he spent and the benefit of those services. Those
factors are simply irrelevant to determining reasonable compensation of a Chapter 7
trustee and applying the commission formula under § 326.
                                                 12
the estate for any services rendered.44 Connolly’s only appointment was as case trustee in

Morreale’s Chapter 7 case, and his compensation is limited by the terms of § 326(a) to

“trustee services”45 in an amount based upon the moneys he disbursed as trustee in the

Chapter 7 case.

       Connolly’s heavy reliance on In re Macco Properties, Inc. as support for allowing

compensation based upon the amount disbursed in the Chapter 11 case is misplaced.46

While we recognize that the fact pattern here is somewhat similar to that in Macco, that

court did not have occasion to analyze in detail § 326(a)’s “in the case” language.47 In

that case, the Chapter 11 trustee was allowed compensation based on distributions made

in multiple Chapter 11 cases and the liquidation of related non-debtor entities and assets.

A key distinction in Macco is that the bankruptcy court entered an order authorizing the

Chapter 11 trustee to jointly administer assets held by wholly-owned debtor entities—for

entities both in and outside of bankruptcy.48 No similar authorization was sought or

granted to Connolly as Chapter 7 trustee in this case. Even if the Macco court had

interpreted § 326(a), its decision, while persuasive, would not be controlling authority on

this Court. Instead, we are compelled by the plain language of the statute to hold that


       44
          See In re Schupbach Invs., L.L.C., 
808 F.3d 1215
, 1219 (10th Cir. 2015)
(quoting Interwest Bus. Equip., Inc. v. U.S. Tr. (In re Interwest Bus. Equip., Inc.), 
23 F.3d 311
, 318 (10th Cir. 1994)); In re Albrecht, 
245 B.R. 666
, 671-72 (10th Cir. BAP 2000),
aff’d 
233 F.3d 1258
(10th Cir. 2000). See also 11 U.S.C. § 330(a)(1).
       45
          11 U.S.C. § 326(a).
       46
          In re Macco Properties, Inc., 
540 B.R. 793
(Bankr. W.D. Okla. 2015).
       47
          
Id. at 799-804.
       48
          
Id. at 817-18.
Another important distinction is that, unlike Chapter 7 trustees,
Chapter 11 trustee compensation has not been removed from the factors’ analysis in
§ 330. See 11 U.S.C. § 330(a)(3).
                                                13
“moneys disbursed or turned over in the case”49 means what it says. A Chapter 7 trustee’s

§ 326(a) compensation is limited to that trustee’s services in the case in which he or she

was appointed to serve and must be calculated solely upon the moneys the trustee

disbursed in that case. It does not allow compensation based upon amounts disbursed to

creditors in a separate Chapter 11 case, even one as closely related as MHLLC’s.

       Conclusion

       We affirm the bankruptcy court’s Compensation Order denying Connolly’s

request for Chapter 7 trustee compensation under § 326(a) based on amounts disbursed in

the MHLLC Chapter 11 case.




       49
            11 U.S.C. § 326(a).
                                                14

Source:  CourtListener

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