In re Airspect Air, Inc‪.‬

The bankruptcy court authorized Airspect Air, Inc. ("Airspect"), then in Chapter 11 proceedings, to retain Jeffrey Nischwitz as special counsel in order to prosecute a breach of contract action against the City of Akron (the "City"). Airspect retained Nischwitz under a contingency fee agreement, and, after the lawsuit settled, Nischwitz filed an application for his contingency fee. The bankruptcy court denied the application, however, finding pursuant to 330 of the Bankruptcy Code that the fee sought by Nischwitz was unreasonable. Nischwitz appealed to the Bankruptcy Appellate Panel of the Sixth Circuit (the "BAP"), which held that the bankruptcy court had "pre-approved" the contingency fee agreement under 328 of the Bankruptcy Code and, thus, was obligated to honor the agreement unless intervening circumstances had rendered the agreement "improvident." On remand, the bankruptcy court held that an intervening circumstance had, in fact, rendered the agreement "improvident," but, on a second appeal, the BAP disagreed. Spasoje Miskovic, the sole interest holder in Airspect, appeals, arguing that (1) the bankruptcy court never "pre-approved" the contingency fee agreement, and alternatively that (2) the termination of the lease by operation of law rendered the agreement "improvident." We hold that the bankruptcy court never "pre-approved" the contingency fee agreement and REVERSE and REMAND.