What Is a 329(b) Motion?
Section 329(b) gives the bankruptcy court the power to review any compensation paid to the debtor's attorney and to order return of excessive amounts. A 329(b) motion is the formal mechanism for requesting this review.
11 U.S.C. Section 329(b): "If such compensation exceeds the reasonable value of any such services, the court may cancel any such agreement, or order the return of any such payment, to the extent excessive, to -- (1) the estate, if the property would have been property of the estate; or (2) the entity that made such payment."
Who Has Standing
Standing to request fee review under 329(b) is intentionally broad:
- The debtor -- The most common movant. The debtor who paid the fees can request review at any time during the case
- The case trustee -- In Chapter 7, the trustee can challenge fees that depleted the estate
- The U.S. Trustee -- The UST actively monitors fee practices and can file motions sua sponte
- Any creditor -- Creditors have standing because excessive fees reduce the pool available for distribution
- The court itself -- The court can raise fee issues on its own motion, even without a request from any party
Pro se debtors: If you are representing yourself, you can file a 329(b) motion against your former attorney. See prosedebtors.org for guidance on pro se filings.
What the Motion Should Contain
A 329(b) motion should include:
- Identification of the fees at issue -- The amount paid, when paid, and the source
- The fee disclosure statement -- Reference the attorney's Rule 2016(b) disclosure (or note its absence)
- Basis for challenge -- Why the fees are excessive. Compare to local norms, identify work not performed, point to disclosure failures
- Evidence -- Receipts, retainer agreements, correspondence about fees, billing records if available
- Relief requested -- Specific dollar amount to be disgorged, or complete disgorgement if disclosure was deficient
The motion is filed with the bankruptcy court and served on the attorney. The court will typically schedule a hearing.
What to Expect at the Hearing
At the hearing, the burden shifts to the attorney to justify the fees. The attorney must demonstrate:
- The services were actually performed
- The fees are consistent with local norms
- The work was necessary and beneficial
- Full disclosure was made
If the court finds fees excessive, it will order disgorgement -- either to the estate (if the fees would have been estate property) or to the entity that paid (typically the debtor).
Timing: 329(b) motions can be filed at any time during the case. Some courts have allowed post-discharge fee challenges, though this varies by circuit. File promptly to preserve your rights.
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