Receiverships: Resolving Disputes with Management of a Small Business
September 24, 2013
Northern Nevada Business Weekly, Business Law Guide
As a creditor to or co-owner of a failing and mismanaged business, you are probably watching your investment or secured collateral disappear. What can you do to preserve value in your investment?
Receiverships are powerful tools for co-owners or creditors of failing businesses. A court-ordered receivership allows one to remove present management and install an independent manager to direct the day-to-day operations of the business, sell assets for the benefit of creditors, or wind-up the company’s affairs when there is a dispute among the shareholders. In the case of an ongoing business, a court-appointed receiver can act to turn the company around, preserving the assets and long-term viability of the business.