Memorandum of Decision Re: Violation of Local Rule

FOR THE NORTHERN DISTRICT OF CALIFORNIA In re PIZZA TIME THEATRE, INC.,                                     No. 584-00941-M      Debtor. ___________________________/ INNSBROOK LIQUIDATING CORP.,      Plaintiff,    v.                                                                                  A.P. No. 860487 R. T. MONTGOMERY, et al.,      Defendants. ______________________________/
Memorandum of Decision
     On April 21, 1988, the court granted summary judgment in favor of plaintiff on defendants' counterclaims. Since summary judgment had already been granted in favor of plaintiff as to the issues raised in the complaint, the April 21 ruling disposed of the entire matter. The summary judgment included an award of reasonable attorneys' fees. Defendants immediately appealed.      District Court Local Rule 270-1, which is made applicable to this adversary proceeding by Local Rule 700-1, requires that applications for attorneys' fees be filed within 60 days of the entry of judgment terminating the action. Plaintiffs failed to file the present application for attorneys' fees until after the judgment was affirmed on appeal. Thus, there will have to be a second appeal if defendants dispute an award of attorneys' fees. Defendants argue that the fees sought are excessive, and should be denied in toto for violation of the local rule.      The Ninth Circuit held in Visa Intern. Service v. Bankcard Holders (9th Cir.1986) 784 F.2d 1472, 1476, that it is within this court's discretion to deny all attorneys' fees for violation of Local Rule 270-1. However, the court also has discretion to excuse violation of the rule in the interests of justice. In re Comer (9th Cir.BAP 1983) 27 B.R. 1018, 1022-23, aff'd 723 F.2d 737. Thus, there is no binding authority which mandates a ruling in favor of one party or the other.      The court agrees with defendants that cause for enforcement of the rule exists where a second appeal may result from failure to file a timely application. However, defendants concede that they incurred $21,681.26 themselves and make no allegation that this amount is excessive. Thus, limiting the award to what defendants themselves have paid would defuse their legitimate concerns over the size of the award (about $37,000.00) requested by plaintiff.      The court does not buy defendants' argument that they did not bother to contest the validity of the award of attorneys' fees because no fees were actually requested. They knew that attorneys' fees could still be awarded for the appeal at least, and it was therefore incumbent upon them to raise the issue in their first appeal regardless of whether an application for attorneys' fees had actually be filed. Their failure to raise the issue at that time precludes an attack now on the basic right of plaintiff to attorneys' fees.      For the foregoing reasons, the court will deny the application as requested due to violation of Local Rule 270-1. However, the court will award attorneys' fees and costs in the lesser sum of $21,681.26.      Counsel for plaintiff shall submit an appropriate form of order, which counsel for defendants has approved as conforming to this ruling.
Dated: October 25, 1989                                                                                  _______________________                                                                                                                            Alan Jaroslovsky                                                                                                                            U.S. Bankruptcy