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ENGROSSED HOUSE
BILL NO. 4236 By: Kannady of the House
and
Howard of the Senate
An Act relating to receivership; creating the Uniform
Commercial Receivership Act; defining terms;
requiring notice and opportunity for hearing to issue
an order under the act; permitting issuance of an
order without prior notice and an opportunity for
hearing under certain circumstances; providing for
application of act to certain property interests;
excluding certain property interests from act;
excluding governmental property from act; clarifying
court authority to appoint a receiver under other
laws of the state; authorizing exclusive jurisdiction
for courts that appoint receiver under this act;
permitting a court to appoint a receiver under
certain circumstances; requiring a potential receiver
to submit certain information before he or she can be
appointed; providing for disqualification of persons
from being a receiver; preventing disqualification of
certain persons; allowing nominations of potential
receivers for court consideration; requiring
receivers to post a bond or alternative security;
providing receiver shall have same status as lien
creditor; authorizing a security agreement covering
after-acquired property; permitting a receiver to
make certain demands; requiring turnover of
receivership property; authorizing courts to impose
sanctions for failure to turn over property; listing
powers and duties of a receiver; providing duties of
an owner; directing the appointment of a receiver
operates as a stay; authorizing an injunction;
authorizing the court to void any act in violation of
a stay or injunction; permitting the court to award
damages for a violation and sanction the violation as
civil contempt; authorizing receiver to engage
professional services to perform receiver duties;
requiring certain disclosures to the court; defining
good faith; permitting use or transfer of
receivership property not in the ordinary course of
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business with court approval; defining timeshare
interest; authorizing a receiver to adopt or reject
an executory contract of the owner relating to
receivership property; prohibiting receiver from
rejecting an unexpired lease of real property under
certain circumstances; providing that a receiver
shall be entitled to all defenses and immunities
provided by law; permitting a receiver to be sued
personally for an act or omission in administering
receivership property with approval of the court;
directing receiver to file interim report; requiring
receiver to provide notice of appointment to
creditors; directing creditors to submit claims
against receivership property; providing for
distribution to creditors; permitting reasonable and
necessary fees and expenses; authorizing court to
remove a receiver for cause; providing for
replacement of receiver; providing for termination of
receivership; requiring receiver to file final
report; discharging receiver upon approval of final
report; providing procedure for receivership in
another state; describing effect of enforcement by
secured party; requiring uniformity of application
and construction of act; clarifying relation to
electronic signatures in global and national commerce
act; providing act does not apply to receivers
appointed before effective date of act; providing for
codification; and providing an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.1 of Title 12, unless there
is created a duplication in numbering, reads as follows:
This act shall be known and may be cited as the "Uniform
Commercial Receivership Act".
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SECTION 2. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.2 of Title 12, unless there
is created a duplication in numbering, reads as follows:
As used in this act:
1. "Affiliate" means:
a. with respect to an individual:
(1) a companion of the individual,
(2) a lineal ancestor or descendant, whether by blood
or adoption, of:
(a) the individual, or
(b) a companion of the individual,
(3) a companion of an ancestor or descendant
described in division (2) of this subparagraph,
(4) a sibling, aunt, uncle, great aunt, great uncle,
first cousin, niece, nephew, grandniece, or
grandnephew of the individual, whether related by
the whole or the half blood or adoption, or a
companion of any of them, or
(5) any other individual occupying the residence of
the individual, and
b. with respect to a person other than an individual:
(1) another person that directly or indirectly
controls, is controlled by, or is under common
control with the person,
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(2) an officer, director, manager, member, partner,
employee, or trustee or other fiduciary of the
person, or
(3) a companion of, or an individual occupying the
residence of, an individual described in
divisions (1) and (2) of this subparagraph;
2. "Collateral" means the property of the debtor subject to a
lien;
3. "Companion" means:
a. the spouse of an individual,
b. the domestic partner of an individual, or
c. another individual in a civil union with an
individual;
4. "Court" means the district court of the county in which an
action is pending wherein relief pursuant to this act is sought;
5. "Debtor" means a person having an interest, other than a
lien, in collateral, whether or not the person is liable for the
secured obligation. "Debtor" includes a mortgagor;
6. "Executory contract" means a contract, including a lease,
under which each party has an unperformed obligation and the failure
of a party to complete performance would constitute a material
breach;
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7. "Governmental unit" means an office, department, division,
bureau, board, commission, or other agency of this state or a
political subdivision of this state;
8. "Lien" means an interest in property which secures payment
or performance of an obligation;
9. "Mortgage" means a record, however denominated, that creates
or provides for a consensual lien on real property or rents, even if
the mortgage also creates or provides for a lien on personal
property;
10. "Mortgagee" means a person entitled to enforce an
obligation secured by a mortgage;
11. "Mortgagor" means a person that grants a mortgage or a
successor in ownership of the real property described in the
mortgage;
12. "Owner" means the person for whose property a receiver is
appointed;
13. "Person" means an individual, estate, business or nonprofit
entity, public corporation, government or governmental political
subdivision, agency, or instrumentality, or other legal entity;
14. "Proceeds" means the following property:
a. whatever is acquired on the sale, lease, license,
exchange, or other disposition of receivership
property,
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b. whatever is collected on, or distributed on account
of, receivership property,
c. rights arising out of receivership property,
d. to the extent of the value of receivership property,
claims arising out of the loss, nonconformity, or
interference with the use of, defects or infringement
of rights in, or damage to the property, or
e. to the extent of the value of receivership property
and to the extent payable to the owner or secured
party, insurance payable by reason of the loss or
nonconformity of, defects or infringement of rights
in, or damage to the property;
15. "Property" means all of a person's rights, title, and
interest, both legal and equitable, in real and personal property,
tangible and intangible, wherever located and however acquired.
"Property" includes proceeds, products, offspring, rents, or profits
of or from the property;
16. "Receiver" means a person appointed by the court as the
court's agent, and subject to the court's direction, to take
possession of, manage, and, if authorized by this act or court
order, transfer, sell, lease, license, exchange, collect, or
otherwise dispose of receivership property;
17. "Receivership" means a proceeding in which a receiver is
appointed;
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18. "Receivership property" means the property of an owner
which is described in the order appointing a receiver or a
subsequent order. "Receivership property" includes any proceeds,
products, offspring, rents, or profits of or from the property;
19. "Record" means information that is inscribed on a tangible
medium or that is stored on an electronic or other medium and is
retrievable in perceivable form;
20. "Rents" means:
a. sums payable for the right to possess or occupy, or
for the actual possession or occupation of, real
property of another person,
b. sums payable to a mortgagor under a policy of rental-
interruption insurance covering real property,
c. claims arising out of a default in the payment of sums
payable for the right to possess or occupy real
property of another person,
d. sums payable to terminate an agreement to possess or
occupy real property of another person,
e. sums payable to a mortgagor for payment or
reimbursement of expenses incurred in owning,
operating, and maintaining real property or
constructing or installing improvements on real
property, or
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f. other sums payable under an agreement relating to the
real property of another person which constitute rents
under law of this state other than this act;
21. "Secured obligation" means an obligation the payment or
performance of which is secured by a security agreement;
22. "Secured party" means a person entitled to enforce a
secured obligation. "Secured party" includes a mortgagee;
23. "Security agreement" means an agreement that creates or
provides for a lien. "Security agreement" includes a mortgage;
24. "Sign" means, with present intent to authenticate or adopt
a record:
a. to execute or adopt a tangible symbol, or
b. to attach to or logically associate with the record an
electronic sound, symbol, or process; and
25. "State" means a state of the United States, the District of
Columbia, Puerto Rico, the United States Virgin Islands, or any
territory or insular possession subject to the jurisdiction of the
United States.
SECTION 3. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.3 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. Except as otherwise provided in subsection B of this
section, the court may issue an order under this act only after
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notice and opportunity for a hearing appropriate in the
circumstances.
B. The court may issue an order under this act:
1. Without prior notice if the circumstances require issuance
of an order before notice is given;
2. After notice and without a prior hearing if the
circumstances require issuance of an order before a hearing is held;
or
3. After notice and without a hearing if no interested party
timely objects to the request for appointment of a receiver and
requests a hearing.
SECTION 4. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.4 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. Except as otherwise provided in subsections B and C of this
section, this act shall apply to a receivership for an interest in
any one or more of the following:
1. Real property and any personal property related to or used
in operating the real property; or
2. Personal property and fixtures.
B. This act shall not apply to a receivership for an interest
in real property improved by one to four dwelling units unless:
1. The interest is used for agricultural, commercial,
industrial, or mineral-extraction purposes, other than incidental
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uses by an owner occupying the property as the owner's primary
residence;
2. The interest secures an obligation incurred at a time when
the property was used or planned for use for agricultural,
commercial, industrial, or mineral-extraction purposes;
3. The owner planned or is planning to develop the property
into one or more dwelling units to be sold or leased in the ordinary
course of the owner's business; or
4. The owner is collecting or has the right to collect rents or
other income from the property from a person other than an affiliate
of the owner.
C. This act shall not apply to a receivership authorized by law
of this state, other than this act, in which the receiver is a
governmental unit or an individual acting in an official capacity on
behalf of the governmental unit except to the extent provided by the
authorizing law.
D. This act shall not limit the authority of a court to appoint
a receiver under other laws of this state. However, Sections 1551
through 1559 of Title 12 of the Oklahoma Statutes shall not apply to
any receiverships within the scope of this act.
E. Unless displaced by a particular provision of this act, the
principles of law and equity shall supplement this act.
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SECTION 5. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.5 of Title 12, unless there
is created a duplication in numbering, reads as follows:
Any court that appoints a receiver under this act shall have
exclusive jurisdiction to direct the receiver and determine any
controversy related to the receivership or receivership property.
SECTION 6. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.6 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. A court may appoint a receiver:
1. Before judgment, to protect a party that demonstrates an
apparent right, title, or interest in property that is the subject
of the action, if the property or its revenue-producing potential:
a. is being subjected to or is in danger of waste, loss,
dissipation, or impairment, or
b. has been or is about to be the subject of a voidable
transaction;
2. After judgment:
a. to carry the judgment into effect, or
b. to preserve nonexempt real property pending appeal or
when an execution has been returned unsatisfied and
the owner refuses to apply the property in
satisfaction of the judgment;
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3. In an action in which a receiver may be appointed on
equitable grounds; or
4. During the time allowed for redemption, to preserve property
sold in an execution or foreclosure sale and secure its rents to the
person entitled to the rents.
B. In connection with the foreclosure or other enforcement of a
security agreement, the court may appoint a receiver for the
collateral if:
1. Appointment is necessary to protect the collateral from
waste, loss, transfer, dissipation, or impairment;
2. The debtor agreed in a signed record to appointment of a
receiver on default;
3. The owner agreed, after default and in a signed record, to
appointment of a receiver;
4. The collateral and any other collateral held by the secured
party are not sufficient to satisfy the secured obligation;
5. The owner fails to turn over to the secured party proceeds
or rents the secured party was entitled to collect; or
6. The holder of a subordinate lien obtains appointment of a
receiver for the property.
C. The court may condition appointment of a receiver without
prior notice under paragraph 1 of subsection B of Section 3 of this
act or without a prior hearing under paragraph 2 of subsection B of
Section 3 of this act on the giving of security by the person
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seeking the appointment for the payment of damages, reasonable
attorney fees, and costs incurred or suffered by any person if the
court later concludes that the appointment was not justified. If
the court later concludes that the appointment was justified, the
court shall release the security.
SECTION 7. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.7 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. The court may not appoint a person as receiver unless the
person submits to the court a statement under penalty of perjury
that the person is not disqualified.
B. Except as otherwise provided in subsection C of this
section, a person shall be disqualified from appointment as receiver
if the person:
1. Is an affiliate of a party;
2. Has an interest materially adverse to an interest of a
party;
3. Has a material financial interest in the outcome of the
action, other than compensation the court may allow the receiver;
4. Has a debtor-creditor relationship with a party; or
5. Holds an equity interest in a party, other than a
noncontrolling interest in a publicly-traded company.
C. A person shall not be disqualified from appointment as
receiver solely because the person:
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1. Was appointed receiver or is owed compensation in an
unrelated matter involving a party or was engaged by a party in a
matter unrelated to the receivership;
2. Is an individual obligated to a party on a debt that is not
in default and was incurred primarily for personal, family, or
household purposes; or
3. Maintains with a party a deposit account as defined in
paragraph 29 of subsection a of Section 1-9-102 of Title 12A of the
Oklahoma Statutes.
D. A person seeking appointment of a receiver may nominate a
person to serve as receiver, but the court shall not be bound by the
nomination.
SECTION 8. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.8 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. Except as otherwise provided in subsection B of this
section, a receiver shall post with the court a bond that:
1. Is conditioned on the faithful discharge of the receiver's
duties;
2. Has one or more sureties approved by the court;
3. Is in an amount the court specifies; and
4. Is effective as of the date of the receiver's appointment.
B. The court may approve the posting by a receiver with the
court of alternative security such as a letter of credit or deposit
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of funds. The receiver may not use receivership property as
alternative security. Interest that accrues on deposited funds
shall be paid to the receiver on the receiver's discharge.
C. The court may authorize a receiver to act before the
receiver posts the bond or alternative security required by this
section.
D. A claim against a receiver's bond or alternative security
shall be made not later than two (2) years after the date the
receiver is discharged.
SECTION 9. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.9 of Title 12, unless there
is created a duplication in numbering, reads as follows:
On appointment of a receiver, the receiver shall have the status
of a lien creditor under:
1. The Uniform Commercial Code – Secured Transactions as to
receivership property that is personal property or fixtures; and
2. The recording statute of this state as to receivership
property that is real property.
SECTION 10. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.10 of Title 12, unless there
is created a duplication in numbering, reads as follows:
Except as otherwise provided by law, property that a receiver or
owner acquires after appointment of the receiver shall be subject to
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a security agreement entered into before the appointment to the same
extent as if the court had not appointed the receiver.
SECTION 11. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.11 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. Unless the court orders otherwise, on demand by a receiver:
1. A person that owes a debt that is receivership property and
is matured or payable on demand or on order shall pay the debt to or
on the order of the receiver, except to the extent the debt is
subject to setoff or recoupment; and
2. Subject to subsection C of this section, a person that has
possession, custody, or control of receivership property shall turn
the property over to the receiver.
B. A person that has notice of the appointment of a receiver
and owes a debt that is receivership property may not satisfy the
debt by payment to the owner.
C. If a creditor has possession, custody, or control of
receivership property and the validity, perfection, or priority of
the creditor's lien on the property depends on the creditor's
possession, custody, or control, the creditor may retain possession,
custody, or control until the court orders adequate protection of
the creditor's lien.
D. Unless a bona fide dispute exists about a receiver's right
to possession, custody, or control of receivership property, the
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court may sanction as civil contempt a person's failure to turn the
property over when required by this section.
SECTION 12. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.12 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. Except as limited by court order or other laws of this
state, a receiver may:
1. Collect, control, manage, conserve, and protect receivership
property;
2. Operate a business constituting receivership property,
including preservation, use, sale, lease, license, exchange,
collection, or disposition of the property in the ordinary course of
business;
3. In the ordinary course of business, incur unsecured debt and
pay expenses incidental to the receiver's preservation, use, sale,
lease, license, exchange, collection, or disposition of receivership
property;
4. Assert a right, claim, cause of action, or defense of the
owner which relates to receivership property;
5. Seek and obtain instruction from the court concerning
receivership property, exercise of the receiver's powers, and
performance of the receiver's duties;
6. On subpoena, compel a person to submit to examination under
oath, or to produce and permit inspection and copying of designated
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records or tangible things, with respect to receivership property or
any other matter that may affect administration of the receivership;
7. Engage a professional as provided in Section 15 of this act;
8. Apply to a court of another state for appointment as
ancillary receiver with respect to receivership property located in
that state; and
9. Exercise any power conferred by court order, this act, or
other laws of this state.
B. With court approval, a receiver may:
1. Incur debt for the use or benefit of receivership property
other than in the ordinary course of business;
2. Make improvements to receivership property;
3. Use or transfer receivership property other than in the
ordinary course of business as provided in Section 16 of this act;
4. Adopt or reject an executory contract of the owner as
provided in Section 17 of this act;
5. Pay compensation to the receiver as provided in Section 21
of this act, and to each professional engaged by the receiver as
provided in Section 15 of this act;
6. Recommend allowance or disallowance of a claim of a creditor
as provided in Section 20 of this act; and
7. Make a distribution of receivership property as provided in
Section 20 of this act.
C. A receiver shall:
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1. Prepare and retain appropriate business records, including a
record of each receipt, disbursement, and disposition of
receivership property;
2. Account for receivership property, including the proceeds of
a sale, lease, license, exchange, collection, or other disposition
of the property;
3. File with the appropriate real property recording office a
copy of the order appointing the receiver and, if a legal
description of the real property is not included in the order, the
legal description;
4. Disclose to the court any fact arising during the
receivership which would disqualify the receiver under Section 7 of
this act; and
5. Perform any duty imposed by court order, this act, or other
law of this state.
D. The powers and duties of a receiver may be expanded,
modified, or limited by court order.
SECTION 13. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.13 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. An owner shall:
1. Assist and cooperate with the receiver in the administration
of the receivership and the discharge of the receiver's duties;
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2. Preserve and turn over to the receiver all receivership
property in the owner's possession, custody, or control;
3. Identify all records and other information relating to the
receivership property, including a password, authorization, or other
information needed to obtain or maintain access to or control of the
receivership property, and make available to the receiver the
records and information in the owner's possession, custody, or
control;
4. On subpoena, submit to examination under oath by the
receiver concerning the acts, conduct, property, liabilities, and
financial condition of the owner or any matter relating to the
receivership property or the receivership; and
5. Perform any duty imposed by court order, this act, or other
laws of this state.
B. If an owner is a person other than an individual, this
section shall apply to each officer, director, manager, member,
partner, trustee, or other person exercising or having the power to
exercise control over the affairs of the owner.
C. If a person knowingly fails to perform a duty imposed by
this section, the court may:
1. Award the receiver actual damages caused by the person's
failure, reasonable attorney fees, and costs; and
2. Sanction the failure as civil contempt.
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SECTION 14. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.14 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. Except as otherwise provided in subsection D of this section
or as ordered by the court, an order appointing a receiver operates
as a stay, applicable to all persons, of an act, action, or
proceeding:
1. To obtain possession of, exercise control over, or enforce a
judgment against receivership property; and
2. To enforce a lien against receivership property to the
extent the lien secures a claim against the owner which arose before
entry of the order.
B. Except as otherwise provided in subsection D of this
section, the court may enjoin an act, action, or proceeding against
or relating to receivership property if the injunction is necessary
to protect the property or facilitate administration of the
receivership.
C. A person whose act, action, or proceeding is stayed or
enjoined under this section may apply to the court for relief from
the stay or injunction for cause.
D. An order under subsection A or B of this section does not
operate as a stay or injunction of:
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1. An act, action, or proceeding to foreclose or otherwise
enforce a security agreement by the person seeking appointment of
the receiver;
2. An act, action, or proceeding to perfect, or maintain or
continue the perfection of, an interest in receivership property;
3. Commencement or continuation of a criminal proceeding;
4. Commencement or continuation of an action or proceeding, or
enforcement of a judgment other than a money judgment in an action
or proceeding, by a governmental unit to enforce its police or
regulatory power;
5. Establishment by a governmental unit of a tax liability
against the owner or receivership property or an appeal of the
liability; or
6. The exercise of rights of a party to a swap agreement,
securities contact, repurchase agreement, commodity contract,
forward contract or master netting agreement, as those terms are
defined in the federal Bankruptcy Code, to the extent that a court
would not have the power to stay the exercise if the owner were a
debtor under the Bankruptcy Code.
E. The court may void an act that violates a stay or injunction
under this section.
F. If a person knowingly violates a stay or injunction under
this section, the court may:
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1. Award actual damages caused by the violation, reasonable
attorney fees, and costs; and
2. Sanction the violation as civil contempt.
SECTION 15. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.15 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. With court approval, a receiver may engage an attorney,
accountant, appraiser, auctioneer, broker, or other professional to
assist the receiver in performing a duty or exercising a power of
the receiver. The receiver shall disclose to the court:
1. The identity and qualifications of the professional;
2. The scope and nature of the proposed engagement;
3. Any potential conflict of interest; and
4. The proposed compensation.
B. A person shall not be disqualified from engagement under
this section solely because of the person's engagement by,
representation of, or other relationship with the receiver, a
creditor, or a party. This act shall not prevent the receiver from
serving in the receivership as an attorney, accountant, auctioneer,
or broker when authorized by law.
C. A receiver or professional engaged under subsection A of
this section shall file with the court an itemized statement of the
time spent, work performed, and billing rate of each person that
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performed the work and an itemized list of expenses. The receiver
shall pay the amount approved by the court.
SECTION 16. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.16 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. In this section, "good faith" means honesty in fact and the
observance of reasonable commercial standards of fair dealing.
B. With court approval, a receiver may use receivership
property other than in the ordinary course of business.
C. With court approval, a receiver may transfer receivership
property other than in the ordinary course of business by sale,
lease, license, exchange, or other disposition. Unless the
agreement of sale provides otherwise, a sale under this section
shall be free and clear of a lien of the person that obtained
appointment of the receiver, any subordinate lien, and any right of
redemption but shall be subject to a senior lien.
D. A lien on receivership property which is extinguished by a
transfer under subsection C of this section attaches to the proceeds
of the transfer with the same validity, perfection, and priority the
lien had on the property immediately before the transfer, even if
the proceeds are not sufficient to satisfy all obligations secured
by the lien.
E. A transfer under subsection C of this section may occur by
means other than a public auction sale. A creditor holding a valid
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lien on the property to be transferred may purchase the property and
offset against the purchase price part or all of the allowed amount
secured by the lien, if the creditor tenders funds sufficient to
satisfy in full the reasonable expenses of transfer and the
obligation secured by any senior lien extinguished by the transfer.
F. A reversal or modification of an order approving a transfer
under subsection C of this section shall not affect the validity of
the transfer to a person that acquired the property in good faith or
revive against the person any lien extinguished by the transfer,
whether the person knew before the transfer of the request for
reversal or modification, unless the court stayed the order before
the transfer.
SECTION 17. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.17 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. In this section, "timeshare interest" means an interest
having a duration of more than three (3) years which grants its
holder the right to use and occupy an accommodation, facility, or
recreational site, whether improved or not, for a specific period
less than a full year during any given year.
B. Except as otherwise provided in subsection H of this
section, with court approval, a receiver may adopt or reject an
executory contract of the owner relating to receivership property.
The court may condition the receiver's adoption and continued
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performance of the contract on terms appropriate under the
circumstances. If the receiver does not request court approval to
adopt or reject the contract within a reasonable time after the
receiver's appointment, the receiver shall be deemed to have
rejected the contract.
C. A receiver's performance of an executory contract before
court approval under subsection B of this section of its adoption or
rejection shall not be an adoption of the contract and shall not
preclude the receiver from seeking approval to reject the contract.
D. A provision in an executory contract which requires or
permits a forfeiture, modification, or termination of the contract
because of the appointment of a receiver or the financial condition
of the owner shall not affect a receiver's power under subsection B
of this section to adopt the contract.
E. A receiver's right to possess or use receivership property
pursuant to an executory contract terminates on rejection of the
contract under subsection B of this section. Rejection shall be a
breach of the contract, effective immediately, before appointment of
the receiver. A claim for damages for rejection of the contract
shall be submitted by the later of:
1. The time set for submitting a claim in the receivership; or
2. Thirty (30) days after the court approves the rejection.
F. If at the time a receiver is appointed, the owner has the
right to assign an executory contract relating to receivership
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property under other laws of this state, the receiver may assign the
contract with court approval.
G. If a receiver rejects under subsection B of this section an
executory contract for the sale of receivership property that is
real property in possession of the purchaser or a real-property
timeshare interest, the purchaser may:
1. Treat the rejection as a termination of the contract, and in
that case the purchaser has a lien on the property for the recovery
of any part of the purchase price the purchaser paid; or
2. Retain the purchaser's right to possession under the
contract, and in that case the purchaser shall continue to perform
all obligations arising under the contract and may offset any
damages caused by nonperformance of an obligation of the owner after
the date of the rejection, but the purchaser has no right or claim
against other receivership property or the receiver on account of
the damages.
H. A receiver may not reject an unexpired lease of real
property under which the owner is the landlord if:
1. The tenant occupies the leased premises as the tenant's
primary residence;
2. The receiver was appointed at the request of a person other
than a mortgagee; or
3. The receiver was appointed at the request of a mortgagee
and:
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a. the lease is superior to the lien of the mortgage,
b. the tenant has an enforceable agreement with the
mortgagee or the holder of a senior lien under which
the tenant's occupancy will not be disturbed as long
as the tenant performs its obligations under the
lease,
c. the mortgagee has consented to the lease, either in a
signed record or by its failure timely to object that
the lease violated the mortgage, or
d. the terms of the lease were commercially reasonable at
the time the lease was agreed to and the tenant did
not know or have reason to know that the lease
violated the mortgage.
SECTION 18. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.18 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. A receiver shall be entitled to all defenses and immunities
provided by law for an act or omission within the scope of the
receiver's appointment.
B. A receiver may be sued personally for an act or omission in
administering receivership property only with approval of the court
that appointed the receiver.
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SECTION 19. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.19 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A receiver may file or, if ordered by the court, shall file an
interim report that includes:
1. The activities of the receiver since appointment or a
previous report;
2. Receipts and disbursements, including a payment made or
proposed to be made to a professional engaged by the receiver;
3. Receipts and dispositions of receivership property;
4. Fees and expenses of the receiver and, if not filed
separately, a request for approval of payment of the fees and
expenses; and
5. Any other information required by the court.
SECTION 20. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.20 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. Except as otherwise provided in subsection F of this
section, a receiver shall give notice of appointment of the receiver
to creditors of the owner by:
1. Deposit for delivery through first-class mail or other
commercially reasonable delivery method to the last-known address of
each creditor; and
2. Publication as directed by the court.
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B. Except as otherwise provided in subsection F of this
section, the notice required by subsection A of this section shall
specify the date by which each creditor holding a claim against the
owner which arose before appointment of the receiver must submit the
claim to the receiver. The date specified shall be at least ninety
(90) days after the letter of notice under paragraph 1 of subsection
A of this section or last publication under paragraph 2 of
subsection A of this section. The court may extend the period for
submitting the claim. Unless the court orders otherwise, a claim
that is not submitted timely shall not be entitled to a distribution
from the receivership.
C. A claim submitted by a creditor under this section shall:
1. State the name and address of the creditor;
2. State the amount and basis of the claim;
3. Identify any property securing the claim;
4. Be signed by the creditor under penalty of perjury; and
5. Include a copy of any record on which the claim is based.
D. An assignment by a creditor of a claim against the owner
shall be effective against the receiver only if the assignee gives
timely notice of the assignment to the receiver in a signed record.
E. At any time before entry of an order approving a receiver's
final report, the receiver may file with the court an objection to a
claim of a creditor, stating the basis for the objection. The court
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shall allow or disallow the claim according to the laws of this
state.
F. If the court concludes that receivership property is likely
to be insufficient to satisfy claims of each creditor holding a
perfected lien on the property, the court may order that:
1. The receiver need not give notice under subsection A of this
section of the appointment to all creditors of the owner, but only
such creditors as the court directs; and
2. Unsecured creditors need not submit claims under this
section.
G. Subject to Section 21 of this act:
1. A distribution of receivership property to a creditor
holding a perfected lien on the property shall be made in accordance
with the creditor's priority under the laws of this state; and
2. A distribution of receivership property to a creditor with
an allowed unsecured claim shall be made as the court directs
according to the laws of this state.
SECTION 21. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.21 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. The court may award a receiver from receivership property
the reasonable and necessary fees and expenses of performing the
duties of the receiver and exercising the powers of the receiver.
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B. The court may order one or more of the following to pay the
reasonable and necessary fees and expenses of the receivership,
including reasonable attorney fees and costs:
1. A person that requested the appointment of the receiver, if
the receivership does not produce sufficient funds to pay the fees
and expenses; or
2. A person whose conduct justified or would have justified the
appointment of the receiver under paragraph 1 of subsection A of
Section 6 of this act.
SECTION 22. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.22 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. The court may remove a receiver for cause.
B. The court shall replace a receiver that dies, resigns, or is
removed.
C. If the court finds that a receiver that resigns or is
removed, or the representative of a receiver that is deceased, has
accounted fully for and turned over to the successor receiver all
receivership property and has filed a report of all receipts and
disbursements during the service of the replaced receiver, the
replaced receiver shall be discharged.
D. The court may discharge a receiver and terminate the court's
administration of the receivership property if the court finds that
appointment of the receiver was improvident or that the
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circumstances no longer warrant continuation of the receivership.
If the court finds that the appointment was sought wrongfully or in
bad faith, the court may assess against the person that sought the
appointment:
1. The fees and expenses of the receivership, including
reasonable attorney fees and costs; and
2. Actual damages caused by the appointment, including
reasonable attorney fees and costs.
SECTION 23. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.23 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. On completion of a receiver's duties, the receiver shall
file a final report including:
1. A description of the activities of the receiver in the
conduct of the receivership;
2. A list of receivership property at the commencement of the
receivership and any receivership property received during the
receivership;
3. A list of disbursements, including payments to professionals
engaged by the receiver;
4. A list of dispositions of receivership property;
5. A list of distributions made or proposed to be made from the
receivership for creditor claims;
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6. If not filed separately, a request for approval of the
payment of fees and expenses of the receiver; and
7. Any other information required by the court.
B. If the court approves a final report filed under subsection
A of this section and the receiver distributes all receivership
property, the receiver shall be discharged.
SECTION 24. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.24 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. The court may appoint a receiver appointed in another state,
or that person's nominee, as an ancillary receiver with respect to
property located in this state or subject to the jurisdiction of the
court for which a receiver could be appointed under this act, if:
1. The person or nominee would be eligible to serve as receiver
under Section 7 of this act; and
2. The appointment furthers the person's possession, custody,
control, or disposition of property subject to the receivership in
the other state.
B. The court may issue an order that gives effect to an order
entered in another state appointing or directing a receiver.
C. Unless the court orders otherwise, an ancillary receiver
appointed under subsection A of this section has the rights, powers,
and duties of a receiver appointed under this act.
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SECTION 25. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.25 of Title 12, unless there
is created a duplication in numbering, reads as follows:
A. A request by a secured party for appointment of a receiver,
the appointment of a receiver, or application by a secured party of
receivership property or proceeds to the secured obligation shall
not:
1. Make the secured party a mortgagee in possession of real
property;
2. Impose any duty on the secured party under Section 1-9-207
of Title 12A of the Oklahoma Statutes;
3. Make the secured party an agent of the owner;
4. Constitute an election of remedies that precludes a later
action to enforce the secured obligation;
5. Make the secured obligation unenforceable;
6. Limit any right available to the secured party with respect
to the secured obligation; or
7. Except as otherwise provided in subsection B of this
section, bar a deficiency judgment pursuant to law of this state
other than this act governing or relating to a deficiency judgment.
B. If a receiver sells receivership property that pursuant to
subsection C of Section 16 of this act which is free and clear of a
lien, the ability of a creditor to enforce an obligation that had
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been secured by the lien shall be subject to laws of this state
relating to a deficiency judgment.
SECTION 26. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.26 of Title 12, unless there
is created a duplication in numbering, reads as follows:
In applying and construing this act, consideration shall be
given to the need to promote uniformity of the law with respect to
its subject matter among states that enact it.
SECTION 27. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.27 of Title 12, unless there
is created a duplication in numbering, reads as follows:
This act modifies, limits, or supersedes the Electronic
Signatures in Global and National Commerce Act, 15 U.S.C., Section
7001 et seq., but shall not be deemed to modify, limit, or supersede
Section 101(c) of that act, 15 U.S.C., Section 7001(c), or authorize
electronic delivery of any of the notices described in Section
103(b) of that act, 15 U.S.C., Section 7003(b).
SECTION 28. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 870.28 of Title 12, unless there
is created a duplication in numbering, reads as follows:
This act shall not apply to a receivership for which the
receiver was appointed before the effective date of this act.
SECTION 29. This act shall become effective November 1, 2026.
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Passed the House of Representatives the 23rd day of March, 2026.
Presiding Officer of the House
of Representatives
Passed the Senate the ___ day of __________, 2026.
Presiding Officer of the Senate