law receivership |
RECEIVERSHIP CASE LAW | APPOINTMENT OF RECEIVER
Fite, MD v. Emtel, Inc. (Tex.App.- Houston [1st Dist.] Oct. 2, 2008)(op. on motion for rehearing by Hanks)
(corporate receivership)(corporate receivership, bond)
AFFIRM TC JUDGMENT: Opinion by Justice Hanks
Before Justices Taft, Hanks and Higley
01-07-00273-CV Diana Fite, M.D. and Intervenor Patrick J. Woods, M.D. v. Emtel, Inc., Joseph Degioanni, M.
D., Individually and on behalf of BEPA
Appeal from 152nd District Court of Harris County
Trial Court Judge: Hon. Kenneth P. Wise
The appointment of a receiver [ ... ] is a harsh, drastic, and extraordinary remedy, to be used cautiously. Hunt
v. Merch. Mart, Inc., 391 S.W.2d 141, 145 (Tex. Civ. App.—Dallas 1965, writ ref’d n.r.e.); see Balias v. Balias,
Inc., 748 S.W.2d 253, 257 (Tex. App.—Houston [14th Dist.] 1988, writ denied). Even if a specific statutory
provision authorizes a receivership, as in this case, a trial court should not appoint a receiver if another
remedy exists, either legal or equitable. Rowe v. Rowe, 887 S.W.2d 191, 200 (Tex. App.—Fort Worth 1994,
writ denied) (observing that statute permitting appointment of receiver over corporation authorizes
appointment only if party seeking relief convinces trial court that all other legal and equitable remedies are
inadequate). Rather, receivership is warranted only if the evidence shows a threat of serious injury to the
applicant. Parness v. Parness, 560 S.W.2d 181, 182 (Tex. Civ. App.—Dallas 1977, no writ); Hughes v.
Marshall Nat’l Bank, 538 S.W.2d 820, 824 (Tex. Civ. App.—Tyler 1976, writ ref’d n.r.e.); Gunther v. Dorff, 296
S.W.2d 638, 640 (Tex. Civ. App.—Waco 1956, writ dism’d). Our review focuses on whether the pleadings and
evidence are sufficient to justify a receivership. See Covington Knox, Inc. v. State, 577 S.W.2d 323, 325 (Tex.
Civ. App.—Houston [14th Dist.] 1979, no pet.) (noting that when appeal from order overruling motion to vacate
receivership is perfected, question becomes simply one of sufficiency of petition to support appointment of
receiver). SOURCE: Benefield v. State of Texas (Tex.App.- Houston [1st Dist.] Aug. 14, 2008)(Bland) (quo
warranto proceeding, receivership, interlocutory appeal, orders granting a temporary injunction and order
appointing receiver reversed)
A court may appoint a receiver over an entire corporation only if all other remedies are deemed inadequate.
See Aubin v. Territorial Mortgage Co. of Am., Inc., 640 S.W.2d 737, 741–42 (Tex. App.—Houston [14th Dist.]
1982, no writ). The burden of proof to show the existence of circumstances justifying the appointment of a
receiver rests on the party seeking the appointment. See Furgerson v. First Nat’l Bank, 218 S.W.2d 1019,
1020 (Tex. Civ. App.—Texarkana 1949, no writ).
Because the appointment of a receiver over the assets and business affairs of a corporation is a “radical
remedy,” it should never be applied “unless some serious injury to the complainant will result, or is
threatened.” See Tex. Consol. Oils v. Hartwell, 240 S.W.2d 324, 327 (Tex. Civ. App.—Dallas 1951, orig.
proceeding). Brazoria County has failed to demonstrate that a serious injury is threatened or will result to the
county or its residents, and thus we hold that the court abused its discretion in appointing a receiver over all of
ACHE’s assets and business affairs.
REVERSE TC JUDGMENT AND REMAND CASE TO TC FOR FURTHER PROCEEDINGS: Opinion by Justice
Bland
Before Justices Taft, Jennings and Bland
01-07-00970-CV Nancy Benefield, Nancy S. McNulty, Naomi Morales, Robert Seton, Ruthie Parker, Susan
Berkley, Gloria Reeves, Shirley Buelow and Angela Breedlove v. The State of Texas on Relation of the Alvin
community Health Endeavor, Inc. and Brazoria County, Texas
Appeal from 239th District Court of Brazoria County
Appellate courts have jurisdiction to consider immediate appeals of interlocutory orders only if a statute
expressly provides appellate jurisdiction. Stary v. DeBord, 967 S.W.2d 352, 352–53 (Tex. 1998). The Texas
Civil Practice and Remedies Code allows for an appeal from an interlocutory order that appoints a receiver or
grants a temporary injunction. Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(1), (4) (Vernon 2008) (listing
appealable interlocutory orders).
Foreclosure Sale Renders Receivership Issue Moot
Pirate's Lake Ltd. v. Vestin Realty Mortgage I, Inc., No. 14-08-00085-CV (Tex.App.- Houston [14th Dist.] Aug.
12, 2008)(challenge to appointment of receiver, foreclosure of property moots issue)
In two issues, Pirate's Lake contends that the trial court erred in appointing a receiver to take possession of
and sell the Property. In its first issue, Pirate's Lake argues that it was not given the minimum three-day notice
of the hearing on Vestin's application for appointment of a receiver, as required by Rule 695 of the Texas
Rules of Civil Procedure. In its second issue, Pirate's Lake asserts that there were no contractual, statutory,
or equitable bases for the appointment of a receiver.
We conclude that, because the Property was sold at a foreclosure sale after Pirate's Lake perfected its
appeal, Pirate's Lake's appeal is moot.
Therefore, because the Property was sold by foreclosure sale after Pirate's Lake perfected its appeal, Pirate's
Lake's appeal is moot. Accordingly, without reference to the merits, we vacate the trial court's order
appointing a receiver to take possession of and sell the Property, and dismiss the underlying cause of action
and this appeal.
Sheik v. Sheikh (Tex.App.- Houston [1st Dist.] Dec. 13, 2007)(Taft)(divorce, receivership, turnover)
REVERSE TC JUDGMENT AND REMAND CASE TO TC FOR FURTHER PROCEEDINGS: Opinion by Justice
Taft
Before Justices Taft, Hanks and Higley
01-05-01022-CV Wasim Ahmed Sheikh v. Shama Sheikh
Appeal from 311th District Court of Harris County (Hon. Doug Warne)
In Re McCormick (Tex.App.- Houston [14th Dist.] Oct. 25, 2007)(per curiam)
(divorce property division enforcement, receiver)
MOTION OR WRIT DENIED: Per Curiam
Before Chief Justice Hedges, Justices Frost and Seymore
14-07-00712-CV In Re: William E. McCormick, Jr.
Appeal from County Court No. 3 of Galveston County (Hon. Roy M. Quintanilla)