The committee does not request compensation for its services or the services of its members, of its secretary, except in so far as the services of its secretary are included in services of its New York counsel. Of the $150,739.89 allowance requested for the period through July 31, 1944, $12,922.76 is for interest to January 1, 1945, on payments made from advances by members of the committee aggregating $144,498.67. There is also included in the committee's statement of expenses an item of $364.17, representing interest on $9,754.48 of advances made by members of the committee prior to October 31, 1939. Interest on such advances to October 31, 1939, was included in the allowance previously made to the committee, but the committee states that such advances could not be repaid until October 1, 1940, because the allowances previously made to the committee were not received by it in time to repay the advances prior to that date. Also included in the $151,818.10 allowance requested by the committee is $110,000 for services of its New York counsel, of which $83,000 has been paid on account, and $4,250 for services of its San Francisco counsel, of which $3,750 has been paid on account.

Following the certification of the plan by the Commission to the district court, counsel prepared and filed with the court the committee's objections to the plan. The committee stated, however, that if the plan were approved by the court in its entirety, it would waive its objections. Committee counsel took the initiative in preparing for submission to other parties stipulations defining the issues and setting forth the facts for filing at the pretrial conference. Counsel attended the pretrial conference held before the court, as a result of which there was filed with the court a stipulation in which the parties agreed upon substantially all of the facts. No agreement having been reached on the issues, two drafts of proposed summaries of the issues were filed, one by the committee and the other by the A. C. James Co. and the Western Pacific Railroad Corporation.

Subsequent to the pretrial conference, counsel prepared and filed the committee's brief in support of the plan. Briefs filed by the objectors to the plan were studied and counsel filed a long memorandum in reply to certain of the arguments contained therein. At the hearing on the plan before the district court, counsel made the principal argument in support of the plan. Counsel were equally prominent in the proceedings before the circuit court of appeals after the district court had approved the plan, participating in the designation of the portions of the record to be included in the record on appeal and the oral argument before the court.

Counsel, on behalf of the committee, applied to the Supreme Court for a writ of certiorari to review the decree of the circuit court disapproving the plan. Counsel also prepared and filed with the court

a brief in reply to the briefs submitted by the parties opposing the petitions for certiorari; filed a memorandum in opposition to the motion of the refunding-mortgage trustee to defer consideration of the petition for certiorari until action by the circuit court on petitions filed with that court by the refunding-mortgage trustee and the debtor for rehearing, the circuit court having dismissed the appeals of those parties; and filed a memorandum in reply to the crosspetition of the debtor.

An ambiguous order having been entered by the circuit court of appeals upon the petitions for rehearing, counsel, acting through San Francisco counsel, obtained a clarifying order from the court which set aside that portion of the decree dismissing the appeals of the refunding-mortgage trustee and the debtor, but denied their petitions for other relief. Thereafter the Supreme Court granted writs of certiorari on all petitions before it in the proceedings, including that of the committee, and counsel immediately began preparation of the main brief, on behalf of the committee, for the Supreme Court. After the filing of the committee's main brief, counsel reviewed and made suggestions with respect to the detailed answering brief filed by the first-mortgage trustees in respect to the controversy concerning the lien of the first and refunding mortgages, and also prepared a shorter brief on behalf of the committee, dealing with the more important aspects of the disputed issues. Counsel also filed a reply brief to the answering briefs of the junior interests on the main questions. Counsel made the opening argument in defense of the plan and also an argument in reply. As previously stated herein, the Supreme Court rendered an opinion reversing the circuit court of appeals and affirming the judgment of the district court approving the plan. The opinion upheld the contentions of committee counsel in all respects. Subsequently the debtor filed a petition for rehearing with the Supreme Court, to which counsel filed an answer. The petition was denied.

Prior to the decision of the Supreme Court, counsel had several conferences with counsel for the interests opposing the plan with respect to the procedure to follow the Court's decision. There being grounds to believe that further protracted litigation would ensue following the submission of the plan to the various classes for acceptance or rejection, committee counsel deemed it advisable to explore the possibilities of agreement among the interested parties upon modifications of the approved plan which would be acceptable to the Commission and the court. Arrangements were made for a conference with the district court and at the conference which counsel attended, the court expressed willingness, if formal request were made, to delay certification of the plan to the Commission for submission. Counsel

devoted about 12 months to bring about an agreement upon a compromise plan. The parties failing to agree upon a compromise, a conference was held by representatives of the interested parties, and agreement was reached by all to support the approved plan. Following the certification by the Commission of the vote upon the plan, the court confirmed the plan. Thereafter counsel from time to time reviewed proposals of the reorganization committee for effectuation of the plan.

In addition to the services performed in connection with the plan, the committee and its counsel, together with representatives of the Finance Corporation and the first-mortgage trustees, bore the burden of opposing the efforts of other of the parties to have the trustees' certificates refunded through private parties or paid off prior to the confirmation of the plan. In this connection, counsel were required to make several trips to San Francisco to confer with the trustees, attend and participate in hearings before the district court, prepare and file memoranda with the district court, and prepare and file briefs on the appeal. Counsel also gave constant attention to numerous matters involved in the administration of the debtor's properties. In respect of these, New York counsel worked in close cooperation with the committee's San Francisco counsel, who, in general, attended the hearings before the district court and kept New York counsel advised in respect thereof.

The recorded time spent by the committee's New York counsel in the above matters between November 1, 1939, to July 31, 1944, totaled 5,046 hours, of which 1,498 represented partners' time, 2,648 hours the time of senior associates, and 900 hours the time of junior associates. Robert T. Swaine, a senior member of the firm of Cravath, Swaine & Moore, the committee's New York counsel, estimates that time spent on this work is at least 20 percent in excess of the recorded time.

As previously stated herein, the time spent by the secretary of the committee is included in the time of New York counsel. Counsel testified that since most of the services required of the secretary involved legal questions, better results were achieved through having an associate lawyer in the firm represent the committee as secretary than by one not a lawyer.

The recorded time spent by the committee's San Francisco counsel is stated at 179 hours and 35 minutes, and a member of the firm acting as such counsel estimates that time devoted to this matter is between 15 to 20 percent in excess of the recorded time.

A. C. James Co.-This company holds a secured claim in the principal amount of $4,999,800, together with accrued unpaid interest of $1,249,950 to January 1, 1939, the effective date of the plan. Petitioner has been represented throughout the proceedings by the firm of Whit

man, Ransom, Coulson & Goetz of New York, and from about November 1, 1939, to August 3, 1942, by San Francisco counsel, Messrs. Grant W. McEnerney and Andrew F. Burke. McEnerney died on or about August 3, 1942, and since that date petitioner has been represented in San Francisco by Andrew F. Burke. Separate petitions for allowances have been filed by counsel.

Petitioner seeks no allowance for the services of its officers or staff, but requests $10,399.57 as an allowance for its actual expenses from November 1, 1939, through December 31, 1944. The company received an allowance of $14,839.61 for expenses, other than attorneys' fees, from the estate of the debtor through October 31, 1939. Petitioner and its counsel have participated actively throughout these proceedings. The nature and extent of such participation will be discussed in connection with the petitions of its counsel.

Whitman, Ransom, Coulson & Goetz.-In addition to the formal representation of A. C. James Co. in the proceedings, petitioners have functioned as counsel for corporations affiliated with A. C. James Co. and individuals connected therewith, who hold or control approximately $9,000,000 of the debtor's first-mortgage bonds, and also hold or control approximately 40 percent of the outstanding capital stock of the Western Pacific Railroad Corporation which had a substantial claim as a general creditor against the debtor and also owned all of the outstanding capital stock of the debtor. While this fact was generally known, no formal appearances were entered by petitioners as counsel for those affiliated corporations and individuals. Petitioners also have been named counsel for the reorganization committee for the debtor, but their pending petition covers services performed solely for A. C. James Co. An allowance of $75,000 as compensation for their services and an allowance of $9,151.16 for reimbursement of expenses incurred during the period from November 31, 1939, through July 31, 1944, is requested by petitioners. An allowance of $10,000 was made out of the estate of the debtor for services rendered by petitioners through October 31, 1939.

The services of the petitioners in the reorganization proceeding included preparation and filing of objections to the plan approved by the Commission, participation at the pretrial conference, appearance and argument before the district court at the hearing on the plan, appearance and argument before the circuit court, and appearance and argument before the Supreme Court. Petitioners also participated in numerous conferences in San Francisco, New York, and Washington. Counsel prepared and submitted various memoranda of law and briefs to the district court, the circuit court, and the Supreme Court. Counsel made continuous and extended studies of the operations of the debtor, cooperated with the attorneys for the other parties in form

ulating the stipulation of facts submitted to the district court. Counsel also petitioned and secured an order of the district court in April 1941, to supplement the record on appeal before the circuit court, of reports showing results of the debtor's operations up to the time of the argument of the appeal. In like manner, after the decision of the circuit court of appeals, and pending appeals to the Supreme Court, counsel took the leading part in securing a stipulation by all parties for placing before the Supreme Court current reports of operations and earnings of the debtor's properties. As a result of these actions, counsel state it was not open to any party to claim that the decision of any of the courts involved was based upon inadequate data.

The record shows that counsel have taken an active and important part throughout the reorganization proceedings. While their efforts, in the main, have been in opposition to the plan approved by the Commission, counsel take the position and their efforts were required in order that the courts might fully and fairly determine the basic issues involved.

As previously stated herein, A. C. James Co. through counsel were the moving spirit in the attempt to have the trustees' certificates refunded through private parties. From the record it is impossible to segregate the amount of time devoted by counsel to this matter, but it is evident that counsel devoted a very large amount of time to it, conferring on numerous occasions with officials of their client and the debtor and the debtor's trustees, appearing and participating in the hearings before the district court, appealing from the order of the district court denying their motion in respect thereof, and preparing and filing briefs with the circuit court of appeals in support of their appeal. Counsel state that, although they were unsuccessful in their efforts to have the trustees' certificates refunded through private parties or paid off in whole or in part, a material reduction in interest charges with a corresponding savings to the debtor's estate resulted through their efforts in inducing the trustees to propose and deposit cash collateral with the Finance Corporation. Counsel also devoted considerable time in respect of other administrative matters during the course of the proceedings.

A total of 5,21314 hours of time was devoted to the various matters arising in connection with the reorganization proceeding and plan by counsel, of which 1,39334 hours represent the work of Robert E. Coulson, a partner, and 2,49214 hours the work of Horace E. Whiteside, who has been associated with petitioners in the capacity of consultant. Most of the rest of the time was spent by associates in petitioners' firm.