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IN RE AMHERST ORTHOPEDIC ASSOCIATES, P.C.

No. 05-11873 B.

355 B.R. 420 (2006)

In re AMHERST ORTHOPEDIC ASSOCIATES, P.C., Debtor.

United States Bankruptcy Court, W.D. New York.

October 26, 2006.

Attorney(s) appearing for the Case

Kelly C. Griffith, Esq., of counsel, Kevin Tompsett, Esq., of counsel, Harris Beach PLLC, Syracuse, NY, for Charter One Bank.

Zdarsky, Sawicki & Agostinelli, Buffalo, NY (Mark J. Schlant, of counsel), Damon & Morey LLP, Buffalo, NY (William F. Savino, Thomas L. Kennedy, of counsel), for Amherst Orthopedic Associates, P.C.

DECISION & ORDER

CARL L. BUCKI, Bankruptcy Judge.

Loan agreements frequently contain the borrower's promise to pay legal fees that a secured lender may subsequently incur in the enforcement of its rights. In bankruptcy, such covenants will never create an unfettered entitlement to recover the costs and expenses of counsel. Rather, section 506(b) of the Bankruptcy Code imposes the further requirement of reasonableness. Thus, in the present dispute...

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