Should the Federal rules of bankruptcy procedure be amended to expressly authorize United States district and bankruptcy courts to appoint a special master in an appropriate...

University of Memphis Law Review, The, Winter 2001 by Clift, R Spencer III

This suggestion, of course, should not be interpreted as a call for the appointment of a special master in a routine bankruptcy case or proceeding. However, litigants involved in contentious bankruptcy cases or proceedings requiring analysis of multiple, contingent, and unliquidated claims might greatly benefit from a special master appointment.74 Unquestionably, the use of special masters should be utilized in extremely complex and rare bankruptcy cases or proceedings involving, for example, multiple, contingent, or unliquidated claims in highly complicated antitrust, product liability, or securities fraud litigation. A bankruptcy court, like other courts administering and adjudicating statutory provisions, should be allowed to implement "abbreviated procedures"" and use innovative case management tools on a case-by-case and proceeding-by-- proceeding basis to serve the interest of all parties and to accomplish the judicial goal set forth in Federal Rule of Bankruptcy Procedure 1001 "to secure the just, speedy, and inexpensive determination of every case and proceeding."76

Difficult accountings often require a special master to compute damage award or interest amounts in non-bankruptcy civil litigation where competing statistical methods are at issue.77 In appropriate and rare bankruptcy cases and proceedings, litigants and courts would greatly benefit from the appointment of a special master, especially where complex and difficult computations are necessary. For example, issues such as employee compensation in corporate litigation,78 fee disputes requiring complex scientific analysis,79 and business marketing analysis80 can be synthesized and organized by technically trained, skilled professionals alleviating the bankruptcy court's substantial workload. Additionally, special masters additionally may provide expertise when the "court's machinery" is insufficient.81 The utilization of such special masters or technical advisors also may provide an expertise and procedural fluidity not possessed by courts or generalist judges.82 Moreover, litigants and busy federal courts could utilize the unique skills of a special master, who could perform the function of organizing and analyzing the claims and estimates of adversaries who have a stake in a highly complex bankruptcy case or proceeding.

The bankruptcy court is the de facto commercial court of America and manages more people and funds than all the other federal courts combined.83 Of all the bankruptcy courts in the world, it is said that the United States bankruptcy court has become the most sophisticated and progressive, and its influence is being felt worldwide as the needs of the global economy reach out for meaningful, international solutions to financial distress.

Many in the bankruptcy community believe that the bankruptcy and district courts, as courts of equity and adjudicators of highly complex, commercial bankruptcy litigation, should be entitled to the use of such an equitable case management device to efficiently adjudicate highly complex issues arising out of appropriate and rare bankruptcy cases and proceedings for the financially challenged and their creditors, especially in resource-exhausting areas of litigation such as discovery.84