16 September 2022
Court Receiverships
In California, the court receiver is entitled to seek compensation. This is pursuant to California Rules of Court, rules 3.1183, 3.1184. Typically, the order appointing the receiver will set forth the procedures whereby the receiver may be compensated. Often, a receiver must circulate a notice of intent to pay fees along with a copy of the receiver’s invoice providing reasonable detail of work performed. Any party has an opportunity to object to the receivership fees and the receiver should not pay such fees prior to the objection period expiring.
Ordinarily, receivers are paid on an hourly basis. The payment of interim fees is generally subject to the ultimate approval and jurisdiction of the court at the end of the case. In addition, if a receiver circulates proposed fees to the parties and the parties do not object, the court may infer that the parties do not object to the payment of such fees. Block billing is frowned upon by courts and receivers are well advised to provide a reasonable level of detail and each monthly invoice.
The receiver’s fees and costs are expenses of the receivership estate. In the event that the estate does not have sufficient cash available to pay the receiver’s fees, the party that sought the appointment of the receiver may be responsible to pay such fees.
Receivers in California are generally compensated on an hourly basis from the assets or cash flow of the receivership estate. The Receiver typically submits a detailed monthly invoice and provides a “notice of intent to pay fees,” or as otherwise required by the Order Appointing Receiver, thereby giving all parties a chance to review and object before any funds are withdrawn.
If the receivership estate lacks sufficient cash or assets to cover the receiver’s costs, the financial burden may shift. In such cases, the court may hold the party who originally sought the appointment of the receiver responsible for paying their fees.
Yes, all compensation for a court receiver is subject to the ultimate approval and jurisdiction of the court. While interim fees can be paid if no parties object to the circulated invoices, the judge must review and grant final approval of all costs at the conclusion of the case.
Courts heavily frown upon “block billing” because it makes it difficult to understand exactly what work was performed. Receivers are generally required to provide a reasonable level of line-item detail in their invoices so that both the judge and the involved parties can verify that the fees are justified and fair. Receivers that are specialists in the area of fidiciary assignments, including receivership, partition, probate, and trustee work, should understand this concept.
3 December 2021
Court Receiverships, Resources
The California Code of Civil Procedure Section 564 lists many of the traditional types of cases in which receivers may be appointed. They include, but are not limited to, the following: Preservation of a common fund or property in dispute and in danger of injury or dissipation;Rents, Issues and Profits (Real Estate);Substandard Housing – The…
10 December 2021
Court Receiverships, Resources
A receivership can be structured in a variety of ways based on the nature of the dispute, the goals and objectives of the parties, the type of asset(s) that will be placed under the control of a receiver as well as the ruling of the court. There are two core types of receiverships – a…
11 May 2022
Court Receiverships, Resources
All court receiverships are not created equally, but the life-cycle of a court receivership has similarities that can be seen in almost every case.
