Our Court Appointed San Bernardino Partnership Dispute Receivers Are Here to Help

Partnership or LLC receivership appointments in California are governed under California Code of Civil Procedure section 564. When appointed as an equity receiver, the receiver takes control of 100% of the receivership entities, stepping into the shoes of the manager and making decisions about the LLC’s/partnership’s operations and assets, as outlined in the court order. The receiver acts as a neutral agent of the court and works to preserve the status quo between parties pending the litigation. Their actions benefit all interested parties, including creditors, and assets are held by the court through the receiver rather than the parties involved.

California Civil Code procedure section 664 outlines the statutory circumstances supporting the appointment of a receiver in various cases, including:

(b) A receiver may be appointed by the court handling the pending action or by a judge from that court, in the following instances:

(1) In a case where a vendor seeks to vacate a fraudulent property purchase or a creditor needs to secure a property or fund for a claim, or if there’s a dispute between joint owners (such as partners or others sharing interest in property or funds). A receiver may be appointed if it’s shown that the property or fund is in danger of being lost, removed, or materially harmed.

(2) If a borrower defaults and a secured lender seeks foreclosure of a deed of trust or mortgage, a receiver may be appointed to preserve the property and prevent it from being lost, damaged, or destroyed. This applies when the lender believes the property is insufficient to cover the debt.

(3) Receivers may be appointed to ensure compliance with a judgment or to facilitate the judgment’s enforcement.

(4) Receivers can also be appointed to carry out the disposition of property as per a judgment or to preserve it during an appeal. They may be involved in managing property during the redemption period following a foreclosure, collecting rents, or distributing proceeds as ordered by the court.

(5) A receiver can be appointed if a corporation is being dissolved, as specified in Section 565.

(6) If a corporation is insolvent, or at risk of insolvency, or has forfeited its corporate rights, a receiver can be appointed to handle its affairs.

(7) In unlawful detainer actions, a receiver can be appointed to manage the property or collect rent during the legal process.

(8) A receiver may be appointed at the request of the Public Utilities Commission, as outlined in Section 1825 or 1826 of the Public Utilities Code.

(9) In any other situation where a receiver is necessary to preserve property or rights that are at risk due to mismanagement or disputes.

(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 cases where a secured lender requests a receiver to perform a specific assignment of rents provision in a deed of trust, mortgage, or separate document. This may continue after a judgment is entered for specific performance, especially if it’s necessary to protect the property or collect rent during a nonjudicial foreclosure.

(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.

The most commonly invoked provisions in LLC disputes are (b)(1) (claims between partners jointly owning property or funds) and (b)(9) (where a receiver is needed to preserve the property or rights of any party).