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David L
David L, Attorney
Category: Business Law
Satisfied Customers: 3255
Experience:  Corporate and Business lawyer since 1997
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If a judge didn't grant a receivership in a business

Customer Question

If a judge didn't grant a receivership in a business (corporation) lawsuit, does that mean the party asking for the receivership lost, or will the lawsuit continue
Submitted: 1 year ago.
Category: Business Law
Expert:  David L replied 1 year ago.

Hi and thanks for asking your question. My name is ***** ***** I will be assisting you. A receivership can be considered a pretty drastic remedy. Therefore, it would not be unusual for the request to be denied. Basically, by granting a receivership, the court is allowing a third party to step in and manage the business while the lawsuit is ongoing. To your question, the lawsuit is not over if the receiver is denied. The lawsuit continues. It only means that the business can continue to manage its own affairs without a receiver doing it for them.

Customer: replied 1 year ago.
Ok, that's good news, however, his attorney provided so many instances where this partner blatantly broke so many contracts within the partnership that he told my husband the receivership was a slam dunk. My husband has a $800,000 note that we are paying 30,000 interest payments on at this point wrapped up in this company that he has not seen a dime of income on, while the other partner is receiving income. Why would the judge not decide for a receivership when things are so drastically not fair compensation wise?
Expert:  David L replied 1 year ago.

Thanks very much for your follow up post. It's hard for me to make specific comments regarding the ruling without fully reviewing the entire case. Thus, I can't really tell you why the judge denied the receivership request. I can say that appointing a receiver is a pretty drastic remedy, so I wouldn't be surprised that the request was denied. But I can tell you that the litigation doesn't end there. In fact, the denial shouldn't have any effect on the litigation going forward.