The creditors' committee is putting its foot down over the appraiser fee because it’s concerned about an apparent pileup of expenses in the case. It’s particularly miffed about a budget for “professionals” involved in the case being one month late.
“The committee has just recently received a draft wind down budget, which still
fails to include budgets for the majority of the professionals approved for employment in this case," the committee wrote in its objection.
Appraise the argument, after the jump
The appraisal fee, the objection notes, "is a relatively minor expense in the overall professional cost of this case, but absent a budget, it is very difficult for the committee to consent to additional professional expenditures that on the face do not appear to be necessary or even warranted given the anticipated auction procedure.”
Oakland-based Clars Auction Gallery put together a proposal to appraise the art for between $8,000 and $12,000 based on an hourly rate of $150. The artwork is scattered across Heller Ehrman’s former offices in San Francisco, Los Angeles, New York, Seattle, San Diego and Washington, DC. A summary balance sheet filed in the bankruptcy estimates the artworks’ value at around $2.3 million.
The firm already spent $5,000 on the gallery, which appraised two-thirds of the San Francisco collection, estimated to be worth over $1 million, before the firm went bankrupt in December.
The plan is to put the art up for auction and sell it in one fell swoop. An independent appraisal apparently helps keep the auction house from setting the minimum bid too low, guaranteeing a better price paid at auction overall.
— Amanda Royal