Pittsburg, CA asked in Business Formation, Business Law, Civil Litigation and Contracts for California

Q: We are currently under receivership and the receiver is running up extremely high costs for the business.

The receiver was also appointed with a large conflict of interest in the case

2 Lawyer Answers
Yelena Gurevich
Yelena Gurevich
  • Studio City, CA
  • Licensed in California

A: What happened when your lawyer petitioned the court to remove/ replace the receive showing proof of conflict and impropriety?

James L. Arrasmith
James L. Arrasmith pro label Lawyers, want to be a Justia Connect Pro too? Learn more ›
  • Sacramento, CA
  • Licensed in California

A: In California, if a receiver appointed to a business is incurring high costs that seem unreasonable, or if there's a conflict of interest, you have options to address these concerns.

First, it's important to review the court order that appointed the receiver to understand the scope of their authority and responsibilities. Receivers are typically required to act in the best interest of the business and its stakeholders.

If you believe the receiver is not fulfilling their duties appropriately or is acting with a conflict of interest, you can file a motion with the court. This motion would request a review of the receiver's actions and costs, and potentially seek their removal or replacement.

Documenting all instances of perceived excessive costs or conflicts of interest is crucial. This evidence will support your case in court.

It's also advisable to communicate your concerns directly to the receiver, seeking clarification and resolution. If this does not yield results, legal action may be necessary.

Consulting with an attorney experienced in receivership and business law can provide you with tailored advice and assistance in navigating this complex situation.

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