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ARTICLE · 27 JUNE 2008

Could Receivership Be The Answer?

Buchalter Nemer
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The number of global corporate defaults in 2008 has already surpassed the total for all of last year, and businesses in varied industries are suffering from the present economic downturn.

United StatesInsolvency/Bankruptcy/Re-Structuring
Monique Jewett-Brewster
Monique Jewett-Brewster

The number of global corporate defaults in 2008 has already surpassed the total for all of last year, and businesses in varied industries are suffering from the present economic downturn. As more and more companies default on their obligations, creditors of such companies should be aware of their rights and remedies in the face of continued default; and one of the most powerful tools in their collective arsenal may be the court-appointed receiver.

What (or Who) is a Receiver?

In general, a receiver is a person appointed by the court to take possession and charge of designated assets or property. The receiver is a fiduciary and officer of the court, and must administer the assets or property in accordance with the court's directives. A receivership can be an alternative to filing a bankruptcy case to liquidate a company's assets; or, a receiver can be appointed to operate a troubled company's

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