Travelers Casualty & Surety Co. of America v. Pacific Gas & Electric Co. (2006)
- Docket
- 05-1429
- Decided
- 2006-01-01
Summary
Question: Can a litigant in a bankruptcy case involving federal bankruptcy law collect attorneys' fees that are granted by a contract or a state law? Conclusion: Yes. Justice Samuel Alito issued the unanimous opinion, which found that the Bankruptcy Code did not expressly waive the contractual obligation to reimburse attorney fees even if incurred in federal litigation. Because the Bankruptcy Code "says nothing about unsecured claims for contractual attorney's fees incurred while litigating issues of bankruptcy law," the Court could "presume that claims enforceable under applicable state law will be allowed in bankruptcy unless they are expressly disallowed." Since none of the nine exemptions waiving contractual obligation to reimburse attorney fees set forth in 11 U.S.C. Section 502(b) applied to Travelers, nothing undermined the debtor's contractual or state-law obligation to pay.