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ULLCA 503(b)(1) Receiver
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Receiver [[!Code]] [--ULLCASecton503b1Receiver--]
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Receiver [[!Code]] [--ULLCASection503b1Receiver--]
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(:title ULLCA 503(b)(1) Receiver:)
(:Summary: ULLCA 503(b)(1) Receiver:)
(:description ULLCA 503(b)(1) Receiver:)
(:keywords charging order, receiver:)
(:linebreaks:)
Receiver [[!Code]] [--ULLCASecton503b1Receiver--]
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!(b) To the extent necessary to effectuate the collection of [[CodeDistribution | distributions]] pursuant to a charging order in effect under subsection (a), the court may:
!(1) appoint a receiver of the [[CodeDistribution | distributions]] subject to the charging order, with the power to make all inquiries the judgment debtor might have made; and
[[ULLCASection503b2OtherOrders|(2)]] make all other orders necessary to give effect to the charging order.
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!!!Reporter's Comment to Subsection (b).
->Paragraph (2) refers to "other orders" rather than "additional orders."
->Therefore, given appropriate circumstances, a court may invoke Paragraph (1), Paragraph (2), or both.
!!!Reporter's Comment to Subsection (b)(1).
->The receiver contemplated here is emphatically not a receiver for the limited liability company, but rather a receiver for the [[CodeDistribution | distributions]] subject to the charging order.
->The principal advantage provided by this paragraph is an expanded right to information.
->However, that right goes no further than "the extent necessary to effectuate the collections of [[CodeDistribution | distributions]] pursuant to a charging order."
->For a correctly narrow reading of this provision, see Wells Fargo Bank, Nat. Ass'n v. Continuous Control Solutions, Inc., No. 11-1285, 2012 WL 3195759 (Iowa Ct. App. Aug. 8, 2012).
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!!!JayNote
->As the comment states, the receiver appointed under ¶ (b) is not, negative, a receiver for the LLC itself, but instead is only a receiver for the [[CodeDistribution | distributions]], and for the creditor the main tactical advantage to such a receiver is for informational rights.
->''Example:'' Creditor holds a judgment against debtor, who has disappeared or is recalcitrant. Normally, the creditor would obtain information about [[CodeDistribution | distributions]] from the debtor, but the court may appoint a receiver to obtain this information in the debtor's place.
->Creditors routinely use this provision, quite appropriately, to have a "limited purpose receiver" appointed by the court with these powers only to enforce the charging order, but then work to expand the receiver's portfolio over matters to eventually become a general-purpose receiver for the debtor's estate generally.
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For court opinions discussing the role of receivers and charging orders [[TopicsReceiverAppointment | click here]].
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!!!RECEIVER OPINIONS
(:pagelist link=Category.Receiver list=normal fmt=title:)
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(:Summary: ULLCA 503(b)(1) Receiver:)
(:description ULLCA 503(b)(1) Receiver:)
(:keywords charging order, receiver:)
(:linebreaks:)
Receiver [[!Code]] [--ULLCASecton503b1Receiver--]
[[<<]]
[[<<]]
!(b) To the extent necessary to effectuate the collection of [[CodeDistribution | distributions]] pursuant to a charging order in effect under subsection (a), the court may:
!(1) appoint a receiver of the [[CodeDistribution | distributions]] subject to the charging order, with the power to make all inquiries the judgment debtor might have made; and
[[ULLCASection503b2OtherOrders|(2)]] make all other orders necessary to give effect to the charging order.
[[<<]]
[[<<]]
----
!!!Reporter's Comment to Subsection (b).
->Paragraph (2) refers to "other orders" rather than "additional orders."
->Therefore, given appropriate circumstances, a court may invoke Paragraph (1), Paragraph (2), or both.
!!!Reporter's Comment to Subsection (b)(1).
->The receiver contemplated here is emphatically not a receiver for the limited liability company, but rather a receiver for the [[CodeDistribution | distributions]] subject to the charging order.
->The principal advantage provided by this paragraph is an expanded right to information.
->However, that right goes no further than "the extent necessary to effectuate the collections of [[CodeDistribution | distributions]] pursuant to a charging order."
->For a correctly narrow reading of this provision, see Wells Fargo Bank, Nat. Ass'n v. Continuous Control Solutions, Inc., No. 11-1285, 2012 WL 3195759 (Iowa Ct. App. Aug. 8, 2012).
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!!!JayNote
->As the comment states, the receiver appointed under ¶ (b) is not, negative, a receiver for the LLC itself, but instead is only a receiver for the [[CodeDistribution | distributions]], and for the creditor the main tactical advantage to such a receiver is for informational rights.
->''Example:'' Creditor holds a judgment against debtor, who has disappeared or is recalcitrant. Normally, the creditor would obtain information about [[CodeDistribution | distributions]] from the debtor, but the court may appoint a receiver to obtain this information in the debtor's place.
->Creditors routinely use this provision, quite appropriately, to have a "limited purpose receiver" appointed by the court with these powers only to enforce the charging order, but then work to expand the receiver's portfolio over matters to eventually become a general-purpose receiver for the debtor's estate generally.
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For court opinions discussing the role of receivers and charging orders [[TopicsReceiverAppointment | click here]].
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!!!RECEIVER OPINIONS
(:pagelist link=Category.Receiver list=normal fmt=title:)
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