Receivers - Other Provisional Remedies In Civil Actions - Civil Procedure - CA

Section § 564

This section of the law explains when a court can appoint a receiver, which is someone who manages property in certain legal situations. Receivers can be appointed in cases like disputes over property ownership, foreclosure proceedings, after a court judgment to carry it out or protect property during an appeal, if a corporation is in trouble, or when public utility or health officials request it. It also covers situations involving hazardous substances on property or the assignment of rents. The law ensures such appointments are necessary to protect property or rights and outlines the receiver's actions, including entering properties safely and with notice. It clarifies who a 'borrower' and 'secured lender' are and defines terms like 'hazardous substances' and 'release.'

(a) A receiver may be appointed, in the manner provided in this chapter, by the court in which an action or proceeding is pending in any case in which the court is empowered by law to appoint a receiver.

(b) A receiver may be appointed by the court in which an action or proceeding is pending, or by a judge of that court, in the following cases:

(1) In an action by a vendor to vacate a fraudulent purchase of property, or by a creditor to subject any property or fund to the creditor’s claim, or between partners or others jointly owning or interested in any property or fund, on the application of the plaintiff, or of any party whose right to or interest in the property or fund, or the proceeds of the property or fund, is probable, and where it is shown that the property or fund is in danger of being lost, removed, or materially injured.

(2) In an action by a secured lender for the foreclosure of a deed of trust or mortgage and sale of property upon which there is a lien under a deed of trust or mortgage, where it appears that the property is in danger of being lost, removed, or materially injured, or that the condition of the deed of trust or mortgage has not been performed, and that the property is probably insufficient to discharge the deed of trust or mortgage debt.

(3) After judgment, to carry the judgment into effect.

(4) After judgment, to dispose of the property according to the judgment, or to preserve it during the pendency of an appeal, or pursuant to the Enforcement of Judgments Law (Title 9 (commencing with Section 680.010)), or after sale of real property pursuant to a decree of foreclosure, during the redemption period, to collect, expend, and disburse rents as directed by the court or otherwise provided by law.

(5) Where a corporation has been dissolved, as provided in Section 565.

(6) Where a corporation is insolvent, or in imminent danger of insolvency, or has forfeited its corporate rights.

(7) In an action of unlawful detainer.

(8) At the request of the Public Utilities Commission pursuant to Section 1825 or 1826 of the Public Utilities Code.

(9) In all other cases where necessary to preserve the property or rights of any party.

(10) At the request of the Office of Statewide Health Planning and Development, or the Attorney General, pursuant to Section 129173 of the Health and Safety Code.

(11) In an action by a secured lender for specific performance of an assignment of rents provision in a deed of trust, mortgage, or separate assignment document. The appointment may be continued after entry of a judgment for specific performance if appropriate to protect, operate, or maintain real property encumbered by a deed of trust or mortgage or to collect rents therefrom while a pending nonjudicial foreclosure under power of sale in a deed of trust or mortgage is being completed.

(12) In a case brought by an assignee under an assignment of leases, rents, issues, or profits pursuant to subdivision (g) of Section 2938 of the Civil Code.

(c) A receiver may be appointed, in the manner provided in this chapter, including, but not limited to, Section 566, by the superior court in an action brought by a secured lender to enforce the rights provided in Section 2929.5 of the Civil Code, to enable the secured lender to enter and inspect the real property security for the purpose of determining the existence, location, nature, and magnitude of any past or present release or threatened release of any hazardous substance into, onto, beneath, or from the real property security. The secured lender shall not abuse the right of entry and inspection or use it to harass the borrower or tenant of the property. Except in case of an emergency, when the borrower or tenant of the property has abandoned the premises, or if it is impracticable to do so, the secured lender shall give the borrower or tenant of the property reasonable notice of the secured lender’s intent to enter and shall enter only during the borrower’s or tenant’s normal business hours. Twenty-four hours’ notice shall be presumed to be reasonable notice in the absence of evidence to the contrary.

(d) Any action by a secured lender to appoint a receiver pursuant to this section shall not constitute an action within the meaning of subdivision (a) of Section 726.

(e) For purposes of this section:

(1) “Borrower” means the trustor under a deed of trust, or a mortgagor under a mortgage, where the deed of trust or mortgage encumbers real property security and secures the performance of the trustor or mortgagor under a loan, extension of credit, guaranty, or other obligation. The term includes any successor in interest of the trustor or mortgagor to the real property security before the deed of trust or mortgage has been discharged, reconveyed, or foreclosed upon.

(2) “Hazardous substance” means any of the following:

(A) Any “hazardous substance” as defined in subdivision (h) of Section 25281 of the Health and Safety Code.

(B) Any “waste” as defined in subdivision (d) of Section 13050 of the Water Code.

(C) Petroleum including crude oil or any fraction thereof, natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel, or any mixture thereof.

(3) “Real property security” means any real property and improvements, other than a separate interest and any related interest in the common area of a residential common interest development, as the terms “separate interest,” “common area,” and “common interest development” are defined in Sections 4095, 4100, and 4185 of the Civil Code, or real property consisting of one acre or less that contains 1 to 15 dwelling units.

(4) “Release” means any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment, including continuing migration, of hazardous substances into, onto, or through soil, surface water, or groundwater.

(5) “Secured lender” means the beneficiary under a deed of trust against the real property security, or the mortgagee under a mortgage against the real property security, and any successor in interest of the beneficiary or mortgagee to the deed of trust or mortgage.

receiver appointment property management foreclosure ...

Section § 565

If a corporation is shutting down, the court in the area where the company operates can appoint someone to manage its assets if a creditor, stockholder, or member asks. This person, known as a receiver or trustee, will handle the company's assets, pay off its debts, and distribute any remaining funds or property to stockholders or members.

Upon the dissolution of any corporation, the Superior Court of the county in which the corporation carries on its business or has its principal place of business, on application of any creditor of the corporation, or of any stockholder or member thereof, may appoint one or more persons to be receivers or trustees of the corporation, to take charge of the estate and effects thereof, and to collect the debts and property due and belonging to the corporation, and to pay the outstanding debts thereof, and to divide the moneys and other property that shall remain over among the stockholders or members.

corporation dissolution receivers trustees ...

Section § 566

This section outlines who can and cannot be appointed as a receiver in a legal case. Specific people, like a party in the case, their attorneys, or anyone related to the judge, can only be appointed as a receiver if everyone involved agrees in writing. Additionally, if a receiver is appointed without informing the other party first (ex parte), the court must ask the person requesting this to promise to cover any harm done if it turns out the appointment was made without good reason.

(a) No party, or attorney of a party, or person interested in an action, or related to any judge of the court by consanguinity or affinity within the third degree, can be appointed receiver therein without the written consent of the parties, filed with the clerk.

(b) If a receiver is appointed upon an ex parte application, the court, before making the order, must require from the applicant an undertaking in an amount to be fixed by the court, to the effect that the applicant will pay to the defendant all damages the defendant may sustain by reason of the appointment of the receiver and the entry by the receiver upon the duties, in case the applicant shall have procured the appointment wrongfully, maliciously, or without sufficient cause.

receiver appointment consanguinity affinity ...

Section § 567

Before starting their role, a receiver must take an oath to do their job faithfully. They also need to provide a financial guarantee, called an undertaking, to the state. This guarantee ensures they will faithfully carry out their responsibilities and follow the court's orders. The receiver can be reimbursed for the cost of this guarantee.

Before entering upon the duties of a receiver:

(a) The receiver must be sworn to perform the duties faithfully.

(b) The receiver shall give an undertaking to the State of California, in such sum as the court or judge may direct, to the effect that the receiver will faithfully discharge the duties of receiver in the action and obey the orders of the court therein. The receiver shall be allowed the cost of the undertaking.

receiver duties oath of performance undertaking ...

Section § 568

A receiver, who is appointed by the court, can manage property by bringing or defending lawsuits under their name, collecting rents, and settling debts. They can also make agreements about the property and perform any actions the court allows.

The receiver has, under the control of the Court, power to bring and defend actions in his own name, as receiver; to take and keep possession of the property, to receive rents, collect debts, to compound for and compromise the same, to make transfers, and generally to do such acts respecting the property as the Court may authorize.

receiver bring and defend actions court control ...

Section § 568.1

This law allows a receiver to deposit securities in their possession into a licensed securities depository, as managed by the court. The depository must follow certain rules and regulations as defined in the Financial Code.

Any securities in the hands of a receiver may, under the control of the court, be deposited by the receiver in a securities depository, as defined in Section 30004 of the Financial Code, which is licensed under Section 30200 of the Financial Code or exempted from licensing thereunder by Section 30005 or 30006 of the Financial Code, and such securities may be held by such securities depository in the manner authorized by Section 775 of the Financial Code.

securities depository receiver court control ...

Section § 568.2

If someone is appointed to manage rental property that has unsafe or poor conditions, they must tell the court about any repair orders they can't complete on time. They have 30 days after getting the job or 15 days if the problem appears later to report it. Their report needs to include details about the problems, the risk they pose, the estimated cost and time needed to fix them, and whether there's enough money to pay for the repairs. If there's not enough money, they should ask the court for more guidance or instructions. The court may then give further directions or decide to end the management period if needed.

(a) A receiver of real property containing rental housing shall notify the court of the existence of any order or notice to correct any substandard or unsafe condition, as defined in Section 17920.3 or 17920.10 of the Health and Safety Code, with which the receiver cannot comply within the time provided by the order or notice.

(b) The notice shall be filed within 30 days after the receiver’s appointment or, if the substandard condition occurs subsequently, within 15 days of its occurrence.

(1) The substandard conditions that exist.

(2) The threat or danger that the substandard conditions pose to any occupant of the property or the public.

(3) The approximate cost and time involved in abating the conditions. If more time is needed to approximate the cost, then the notice shall provide the date on which the approximate cost will be filed with the court and that date shall be within 10 days of the filing.

(4) Whether the receivership estate is likely to contain sufficient funds to abate the conditions.

(d) If the receivership estate does not contain sufficient funds to abate the conditions, the receiver shall request further instructions or orders from the court.

(e) The court, upon receipt of a notice pursuant to subdivision (d), shall consider appropriate orders or instructions to enable the receiver to correct the substandard conditions or to terminate or limit the period of receivership.

receiver of real property rental housing substandard conditions ...

Section § 568.3

This law allows tenants, tenant groups, or government agencies to ask a court for help if there are problems with a rental property under receivership. They can do this if the property is in poor condition or if there is a disagreement about what the receiver, the person managing the property during receivership, can or should do that affects tenants or the public.

Any tenant of real property that is subject to receivership, a tenant association or organization, or any federal, state, or local enforcement agency, may file a motion in a receivership action for the purpose of seeking further instructions or orders from the court, if either of the following is true:

(a) Substandard conditions exist, as defined by Section 17920.3 or 17920.10 of the Health and Safety Code.

(b) A dispute or controversy exists concerning the powers or duties of the receiver affecting a tenant or the public.

receivership tenant rights property management ...

Section § 568.5

This law allows a court-appointed receiver, who is responsible for managing property during legal proceedings, to sell property they are holding. However, they must provide notice about the sale as required by specific rules, and the sale isn't complete until the court approves it.

A receiver may, pursuant to an order of the court, sell real or personal property in the receiver’s possession upon the notice and in the manner prescribed by Article 6 (commencing with Section 701.510) of Chapter 3 of Division 2 of Title 9. The sale is not final until confirmed by the court.

receiver court-appointed property sale ...

Section § 568.6

This law means that if the Public Utilities Commission asks, a court can appoint someone called a receiver to take control of and run Pacific Gas and Electric Company. The court will decide the specific rules and conditions for how the receiver will operate the company.

A receiver appointed at the request of the Public Utilities Commission pursuant to Section 1825 of the Public Utilities Code shall control and operate Pacific Gas and Electric Company upon such terms and conditions as the court prescribes.

receiver Public Utilities Commission Pacific Gas and Electric Company ...

Section § 569

This law allows a court-appointed receiver to deposit funds they're managing into interest-bearing accounts, as long as certain conditions are met. These funds must be held in accounts that are fully insured by federal law. The bank or financial institution holding the funds cannot be involved in the legal action that led to the receiver's appointment. Additionally, the receiver cannot have significant personal or family connections to the institution.

Funds in the hands of a receiver may be deposited in one or more interest bearing accounts in the name and for the benefit of the receivership estate with one or more financial institutions, provided that all of the following conditions are satisfied:

(a) The deposits are fully guaranteed or insured under federal law.

(b) The financial institution in which the funds are deposited is not a party to the action in which the receiver was appointed.

(c) The receiver does not own 1 percent or more in value of the outstanding stock of the financial institution, is not an officer, director, or employee of the financial institution, and is not a sibling, whether by the whole or half-blood, spouse, aunt, uncle, nephew, niece, ancestor, or lineal descendant of an owner, officer, employee, or director.

receiver funds interest-bearing accounts receivership estate ...

Section § 570

If a receiver has money that belongs to someone they can't locate, they must announce it in local newspapers once a week for four weeks, listing the owner’s name, last known address, and the amount. If the money remains unclaimed 30 days after the last notice, the court orders it be sent to the State Treasury. Costs for the notice are taken from these unclaimed funds.

A receiver having any funds in his hands belonging to a person whose whereabouts are unknown to him, shall, before receiving his discharge as such receiver, publish a notice, in one or more newspapers published in the county, at least once a week for four consecutive weeks, setting forth the name of the owner of any unclaimed funds, the last known place of residence or post office address of such owner and the amount of such unclaimed funds. Any funds remaining in his hands unclaimed for 30 days after the date of the last publication of such notice, shall be reported to the court, and upon order of the court, all such funds must be paid into the State Treasury accompanied with a copy of the order, which must set forth the facts required in the notice herein provided. Such funds shall be deemed to have been received by the State under Chapter 7 (commencing with Section 1500) of Title 10 of Part 3 of this code and may be recovered in the manner prescribed therein.

All costs and expenses connected with such advertising shall be paid out of the funds the whereabouts of whose owners are unknown.

receiver obligations unclaimed funds publishing notice ...

Other Provisional Remedies In Civil Actions

Other Provisional Remedies in Civil ActionsReceivers

Section § 564

Section § 565

Section § 566

Section § 567

Section § 568

Section § 568.1

Section § 568.2

Section § 568.3

Section § 568.5

Section § 568.6

Section § 569

Section § 570

Struggling to fill out your Divorce Forms?

COMPANY

WHAT YOU CAN DO

RESOURCES

FOLLOW US

ARTICLES