How to compensate a Chapter 7 Trustee

The problem in LeJeune v. JFK Capital Holdings LLC was the following: “Two approaches for determining the appropriate ‘commission’ for Chapter 7 trustees have emerged in recent years. Under the first approach, some courts hold that Section 326(a) is not simply a maximum but also a presumptively reasonable fixed commission rate to be reduced only in rare instances.Other courts hold that the presumptively reasonable approach is nonetheless subject to adjustment in ‘extraordinary circumstances.’ Some courts similarly presume that the Section 326(a) percentages are reasonable, but perform a more in-depth review of the trustee’s services to ensure the presumption is justified.'” (citations omitted). After reviewing the applicable statutes, the Fifth Circuit aligned itself with the first approach and the analysis of Mohns, Inc. v. Lanser, 522 B.R. 594, 601 (E.D. Wis.), aff’d sub nom. In re Wilson, 796 F.3d 818 (7th Cir. 2015). No. 16-31151-CV (Jan. 26, 2018).

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