CIVIL PRACTICE & REMEDIES CODE
CHAPTER 64. RECEIVERSHIP
SUBCHAPTER A. GENERAL PROVISIONS
§ 64.001. AVAILABILITY OF REMEDY. (a) A court of
competent jurisdiction may appoint a receiver:
(1) in an action by a vendor to vacate a fraudulent
purchase of property;
(2) in an action by a creditor to subject any property
or fund to his claim;
(3) in an action between partners or others jointly
owning or interested in any property or fund;
(4) in an action by a mortgagee for the foreclosure of
the mortgage and sale of the mortgaged property;
(5) for a corporation that is insolvent, is in
imminent danger of insolvency, has been dissolved, or has forfeited
its corporate rights; or
(6) in any other case in which a receiver may be
appointed under the rules of equity.
(b) Under Subsection (a)(1), (2), or (3), the receiver may
be appointed on the application of the plaintiff in the action or
another party. The party must have a probable interest in or right
to the property or fund, and the property or fund must be in danger
of being lost, removed, or materially injured.
(c) Under Subsection (a)(4), the court may appoint a
receiver only if:
(1) it appears that the mortgaged property is in
danger of being lost, removed, or materially injured; or
(2) the condition of the mortgage has not been
performed and the property is probably insufficient to discharge
the mortgage debt.
(d) A court having family law jurisdiction or a probate
court located in the county in which a missing person, as defined by
Article 63.001, Code of Criminal Procedure, resides or, if the
missing person is not a resident of this state, located in the
county in which the majority of the property of a missing person's
estate is located may, on the court's own motion or on the
application of an interested party, appoint a receiver for the
missing person if:
(1) it appears that the estate of the missing person is
in danger of injury, loss, or waste; and
(2) the estate of the missing person is in need of a
representative.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985. Amended
by Acts 1997, 75th Leg., ch. 1376, § 4, eff. Sept. 1, 1997; Acts
1999, 76th Leg., ch. 1081, § 1, 3, eff. Sept. 1, 1999.
§ 64.002. PERSONS NOT ENTITLED TO APPOINTMENT. (a) A
court may not appoint a receiver for a corporation, partnership, or
individual on the petition of the same corporation, partnership, or
individual.
(b) A court may appoint a receiver for a corporation on the
petition of one or more stockholders of the corporation.
(c) This section does not prohibit:
(1) appointment of a receiver for a partnership in an
action arising between partners; or
(2) appointment of a receiver over all or part of the
marital estate in a suit filed under Title 1 or 5, Family Code.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985. Amended
by Acts 1987, 70th Leg., ch. 167, § 3.12(a), eff. Sept. 1, 1987;
Acts 1997, 75th Leg., ch. 165, § 7.06, eff. Sept. 1, 1997.
§ 64.003. FOREIGN APPOINTMENT. A court outside this
state may not appoint a receiver for:
(1) a person who resides in this state and for whom
appointment of a receiver has been applied for in this state; or
(2) property located in this state.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.004. APPLICATION OF EQUITY RULES. Unless
inconsistent with this chapter or other general law, the rules of
equity govern all matters relating to the appointment, powers,
duties, and liabilities of a receiver and to the powers of a court
regarding a receiver.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
SUBCHAPTER B. QUALIFICATIONS, OATH, AND BOND
§ 64.021. QUALIFICATIONS; RESIDENCE
REQUIREMENT. (a) To be appointed as a receiver for property that
is located entirely or partly in this state, a person must:
(1) be a citizen and qualified voter of this state at
the time of appointment; and
(2) not be a party, attorney, or other person
interested in the action for appointment of a receiver.
(b) The appointment of a receiver who is disqualified under
Subsection (a)(1) is void as to property in this state.
(c) A receiver must maintain actual residence in this state
during the receivership.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.022. OATH. Before a person assumes the duties of a
receiver, he must be sworn to perform the duties faithfully.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.023. BOND. Before a person assumes the duties of a
receiver, he must execute a good and sufficient bond that is:
(1) approved by the appointing court;
(2) in an amount fixed by the court; and
(3) conditioned on faithful discharge of his duties as
receiver in the named action and obedience to the orders of the
court.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
SUBCHAPTER C. POWERS AND DUTIES
§ 64.031. GENERAL POWERS AND DUTIES. Subject to the
control of the court, a receiver may:
(1) take charge and keep possession of the property;
(2) receive rents;
(3) collect and compromise demands;
(4) make transfers; and
(5) perform other acts in regard to the property as
authorized by the court.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.032. INVENTORY. As soon as possible after
appointment, a receiver shall return to the appointing court an
inventory of all property received.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.033. SUITS BY RECEIVER. A receiver may bring suits
in his official capacity without permission of the appointing
court.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.034. INVESTMENTS, LOANS, AND CONTRIBUTIONS OF
FUNDS. (a) Except as provided by Subsection (b), on an order of
the court to which all parties consent, a receiver may invest for
interest any funds that he holds.
(b) A receiver appointed for a missing person under Section
64.001(d) who has on hand an amount of money belonging to the
missing person in excess of the amount needed for current
necessities and expenses may, on order of the court, invest, lend,
or contribute all or a part of the excess amount in the manner
provided by Subpart L, Part 4, Chapter XIII, Texas Probate Code, for
investments, loans, or contributions by guardians. The receiver
shall report to the court all transactions involving the excess
amount in the manner that reports are required of guardians.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985. Amended
by Acts 1999, 76th Leg., ch. 1081, § 4, eff. Sept. 1, 1999.
§ 64.035. DEPOSIT OF CERTAIN RAILROAD FUNDS. If a
receiver operates a railroad that lies wholly within this state,
the receiver shall deposit all money that comes into his hands, from
operation of the railroad or otherwise, in a place in this state
directed by the court. The money shall remain on deposit until
properly disbursed. If any portion of the railroad lies in another
state, the court shall require the receiver to deposit in this state
a share of the funds that is at least proportionate to the value of
the property of the company in this state.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.036. RECEIVERSHIP PROPERTY HELD BY FINANCIAL
INSTITUTION. Service or delivery of a notice of receivership, or a
demand or instruction by or on behalf of a receiver, relating to
receivership property held by a financial institution in the name
of or on behalf of a customer of the financial institution is
governed by Section 59.008, Finance Code.
Added by Acts 1999, 76th Leg., ch. 344, § 7.005, eff. Sept. 1,
1999.
SUBCHAPTER D. CLAIMS AND LIABILITIES
§ 64.051. APPLICATION OF FUNDS; PREFERENCES. (a) A
receiver shall apply the earnings of property held in receivership
to the payment of the following claims in the order listed:
(1) court costs of suit;
(2) wages of employees due by the receiver;
(3) debts owed for materials and supplies purchased by
the receiver for the improvement of the property held as receiver;
(4) debts due for improvements made during the
receivership to the property held as receiver;
(5) claims and accounts against the receiver on
contracts made by the receiver, personal injury claims and claims
for stock against the receiver accruing during the receivership,
and judgments rendered against the receiver for personal injuries
and for stock killed; and
(6) judgments recovered in suits brought before the
receiver was appointed.
(b) Claims listed in this section have a preference lien on
the earnings of the property held by the receiver.
(c) The court shall ensure that the earnings are paid in the
order of preference listed in this section.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.052. SUITS AGAINST RECEIVER. (a) A receiver who
holds property in this state may be sued in his official capacity in
a court of competent jurisdiction without permission of the
appointing court.
(b) A suit against a receiver may be brought where the
person whose property is in receivership resides.
(c) In a suit against a receiver, citation may be served on
the receiver or on any agent of the receiver who resides in the
county in which the suit is brought.
(d) The discharge of a receiver does not abate a suit
against the receiver or affect the right of a party to sue the
receiver.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.053. PAYMENT OF JUDGMENT AGAINST RECEIVER. The
court that appointed a receiver shall order any judgment against
the receiver to be paid from funds held by the receiver.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.054. JUDGMENT LIEN. A judgment rendered against a
receiver in a cause of action arising during the receivership is a
lien on all property held by the receiver. The lien is superior to
the mortgage lien of a mortgagee who instituted the receivership.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.055. EXECUTION ON JUDGMENT. (a) To obtain
payment on a judgment against a receiver, the owner of the judgment
may apply to the court that appointed the receiver for an order that
the receiver pay the judgment. If the receiver possesses money that
is subject to payment of the judgment, but the court refuses to
order payment, the owner of the judgment may apply to the court that
issued the judgment for execution on the judgment.
(b) The owner of the judgment must file with the court that
issued the judgment an affidavit reciting that:
(1) he applied to the court that appointed the
receiver for an order of payment;
(2) it was shown to the appointing court that the
receiver had money subject to payment of the judgment at that time;
and
(3) the appointing court refused to order the receiver
to pay the judgment.
(c) The court that issued the judgment shall issue execution
that may be levied on any property held by the receiver. The
property shall be sold as under ordinary execution, and the sale of
the property conveys title to the purchaser.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.056. LIABILITY OF PERSONS RECEIVING RECEIVERSHIP
PROPERTY. (a) A person to whom a receiver delivers property held
in receivership, including the owner of the property, a person who
receives it for the owner, or an assignee of the owner is liable to
the extent of the value of the property for the liabilities of the
receiver arising during the receivership that are unpaid at the
time of the receiver's discharge. The person receiving the
property may be made a defendant to a suit against the receiver, and
if judgment is rendered against the receiver, the court shall also
render judgment against that defendant.
(b) A judgment against a receiver or an unpaid claim that
arose during the receivership and has not been sued on at the date
the receiver is discharged constitutes a preference lien on the
property held by the receiver on the date of discharge. The lien is
superior to the mortgage lien of a mortgagee who instituted the
receivership. The person who received the property is liable on the
judgment or claim to the extent of the value of the property.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
SUBCHAPTER E. PROVISIONS RELATING TO RECEIVERSHIP OF CORPORATIONS
§ 64.071. VENUE FOR APPOINTMENT. An action to have a
receiver appointed for a corporation with property in this state
shall be brought in the county in which the principal office of the
corporation is located.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.072. LIMITED DURATION. (a) Except as provided by
this section, a court may not administer a corporation in
receivership for more than three years after the date the receiver
is appointed, and the court shall wind up the affairs of the
corporation within that period.
(b) A court may, from time to time, extend the duration of a
corporate receivership if:
(1) litigation prevents the court from winding up the
affairs of the corporation within three years; or
(2) the receiver is operating the corporation as a
going concern.
(c) To extend the duration of a corporate receivership, the
court must have received an application for the extension and,
following notice to all attorneys of record, must conduct a hearing
on the extension. As required by the best interests of all
concerned parties, the court may prescribe conditions for the
extension and extend it for a term within the limits provided by
Subsection (d). The court shall enter into its minutes the proper
order extending the receivership.
(d) A court may not extend a corporate receivership for more
than five years beyond the original three years, except that the
court may extend for any additional period the receivership of a
corporation organized and existing under Article 3.05(A)(2), Texas
Miscellaneous Corporation Laws Act (Article 1302-3.05, Vernon's
Texas Civil Statutes), or Title 112, Revised Statutes.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.0721. TERMINATION OF RAILROAD
RECEIVERSHIP. (a) A receiver of a railroad company located
wholly within this state that has been in receivership for more than
50 years may apply to the court that appointed the receiver
requesting the court to:
(1) terminate the receivership; and
(2) disburse any assets of the railroad company
remaining after the payment of the company's debts to one or more
nonprofit charitable organizations chosen by the receiver for use
in providing services within the county in which the receiver was
appointed.
(b) After a receiver makes an application under Subsection
(a), the receiver shall publish notice of the proposed termination
of the receivership for seven consecutive days in a newspaper of
general circulation in the county in which the receivership is
located. The notice must state that a person with an interest in
the assets of the railroad company may file a claim with the court
that appointed the receiver not later than the 90th day after the
final day of the publication of the notice.
(c) After the expiration of the period for filing claims
provided by Subsection (b) and after the court resolves all claims
filed with the court relating to the railroad company, the court
shall disburse any remaining assets of the receivership to the
nonprofit charitable organizations chosen by the receiver that are
acceptable to the court in its discretion.
(d) Any noncash assets of a railroad company that exist when
its receivership is terminated under this section escheat to the
state.
Added by Acts 1997, 75th Leg., ch. 821, § 1, eff. June 17, 1997.
§ 64.073. EARNINGS ON IMPROVED PROPERTY LIABLE FOR
DEBTS. (a) A corporation in receivership shall contribute to the
payment of any floating debts against it an amount equal to the full
value of current earnings spent by the receiver for:
(1) improvements to the corporate property held by the
receiver, the purchase of rolling stock or machinery, and other
improvements that increase the value of the property; or
(2) the extension of a road or the acquisition of land
in connection with a road.
(b) If property of a corporation in receivership is sold
under court order in a lien foreclosure, the court shall order the
clerk to retain from the sale proceeds an amount equal to the value
of improvements made by the receiver to the property sold and shall
order that money to be paid to persons with a claim, debt, or
judgment against the corporation. The courts shall require an
amount of cash sufficient for that purpose to be paid in at the date
of sale.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.074. CLAIMS PREFERENCE AGAINST CURRENT
EARNINGS. A judgment or claim existing against a corporation at
the time the receiver is appointed or a judgment in an action
existing at that time shall be paid out of the earnings of the
corporation earned during the receivership in preference to the
mortgage of a mortgagee who instituted the receivership. The
judgment or claim is a lien on those earnings.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.075. FORFEITURE OF CHARTER FOR UNQUALIFIED
RECEIVER. If a person who is not a citizen and qualified voter of
this state is appointed receiver for a domestic corporation that
owns property in this state, the corporation forfeits its charter.
The attorney general shall immediately bring suit in the nature of
quo warranto for forfeiture of the charter.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.076. SUITS AGAINST RAILROAD RECEIVER: VENUE AND
SERVICE. An action against the receiver of a railroad company may
be brought in any county through or into which the railroad is
constructed, and citation may be served on the receiver, the
general or division superintendent, or an agent of the receiver who
resides in the county in which the suit is brought. If no agent of
the receiver resides in the county in which the suit is brought,
citation may be served on any agent of the receiver in this state.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
SUBCHAPTER F. RECEIVER FOR CERTAIN MINERAL INTERESTS
§ 64.091. RECEIVER FOR MINERAL INTERESTS OWNED BY
NONRESIDENT OR ABSENTEE. (a) The purpose of this section is to
encourage the exploration and development of mineral resources.
(b) In the following actions, a district court may appoint a
receiver for the mineral interest or leasehold interest under a
mineral lease owned by a nonresident or absent defendant:
(1) an action that is brought by a person claiming or
owning an undivided mineral interest in land in this state or an
undivided leasehold interest under a mineral lease of land in this
state and that has one or more defendants who have, claim, or own an
undivided mineral interest in the same property; or
(2) an action that is brought by a person claiming or
owning an undivided leasehold interest under a mineral lease of
land in this state and that has one or more defendants who have,
claim, or own an undivided leasehold interest under a mineral lease
of the same property.
(b) The defendant for whom the receiver is sought must:
(1) be a person whose residence or identity is unknown
or a nonresident; and
(2) have not paid taxes on the interest or rendered it
for taxes during the five-year period immediately preceding the
filing of the action.
(c) The plaintiff in the action must allege by verified
petition and prove that he:
(1) has made a diligent but unsuccessful effort to
locate the defendant; and
(2) will suffer substantial damage or injury unless
the receiver is appointed.
(d) In an action under Subsection (b)(1):
(1) the plaintiff, in the verified petition, must name
the last known owner or the last record owner of the interest as
defendant;
(2) the plaintiff must serve notice on the defendant
by publication as provided by the Texas Rules of Civil Procedure;
(3) the court may appoint as receiver the county judge
and his successors, the county clerk and his successors, or any
other resident of the county in which the land is located;
(4) notwithstanding the Texas Rules of Civil
Procedure, the applicant is not required to post bond; and
(5) the receiver is not required to post bond.
(e) A receivership created under this subchapter continues
as long as the defendant or his heirs, assigns, or personal
representatives fail to appear in court in person or by agent or
attorney to claim the defendant's interest.
(f) As ordered by the court, the receiver shall immediately:
(1) execute and deliver to a lessee or successive
lessees mineral leases on the outstanding undivided mineral
interests;
(2) execute and deliver to a lessee or successive
lessees an assignment of the outstanding undivided leasehold
interest; and
(3) enter into a unitization agreement authorized by
the Railroad Commission of Texas.
(g) A lease executed by a receiver under this section may
authorize the lessee to pool and unitize land subject to the lease
with adjacent land into a unit not to exceed 160 acres for an oil
well or 640 acres for a gas well plus 10 percent tolerance or into a
unit that substantially conforms to a larger unit prescribed or
permitted by governmental rule.
(h) Money consideration paid for the execution of a lease,
assignment, or unitization agreement by the receiver must be paid
to the clerk of the court in which the case is pending before the
receiver executes the instrument. The court shall apply the money
to the costs accruing in the case and retain any balance for the use
and benefit of the nonresident or person of unknown residence who
owns the mineral or leasehold interest. Payments made at a later
time under the lease, assignment, or unitization agreement shall be
paid into the registry of the court and impounded for the use and
benefit of the owner of the mineral or leasehold interest.
(i) This section is cumulative of other laws relating to
removal of a cloud from title or appointment of a receiver.
(j) In this section:
(1) 'Mineral lease' includes any lease of oil, gas, or
other minerals that contains provisions necessary or incident to
the orderly exploration, development, and recovery of oil, gas, or
other minerals.
(2) 'Leasehold interest' includes ownership created
under a mineral lease or carved out of a leasehold estate granted
under a mineral lease, including production payments, overriding
royalty interests, and working interests.
(3) 'Lessee' includes an assignee under an assignment
of a mineral lease.
(k) To the extent that Subsection (d)(2) conflicts with the
Texas Rules of Civil Procedure, Subsection (d)(2) controls.
Notwithstanding Section 22.004, Government Code, the supreme court
may not amend or adopt rules in conflict with Subsection (d)(2).
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985. Amended
by Acts 1989, 71st Leg., ch. 492, § 1, eff. June 14, 1989; Acts
1989, 71st Leg., ch. 998, § 1, eff. Sept. 1, 1989; Acts 1991,
72nd Leg., ch. 16, § 3.01, eff. Aug. 26, 1991.
§ 64.092. RECEIVER FOR CONTINGENT INTERESTS IN
MINERALS. (a) On the application of a person who has a vested,
contingent, or possible interest in land or an estate subject to a
contingent future interest, a district court of the county in which
all or part of the land is located may appoint a receiver for the
land or estate, pending the occurrence of the contingency and the
vesting of the future interest, if:
(1) the land or estate is susceptible to drainage of
oil, gas, or other minerals;
(2) lease of the land for oil, gas, or mineral
development and the safe and proper investment of the proceeds will
inure to the benefit and advantage of the persons entitled to the
proceeds; or
(3) lease of the land for the production of oil, gas,
or other minerals is necessary for the conservation, preservation,
or protection of the land or estate or of a present, contingent, or
future interest in the land or estate.
(b) As authorized or directed by the court, a receiver
appointed under Subsection (a) may:
(1) lease the land for the development of oil, gas, or
other minerals at public or private sale and on terms and conditions
directed by the court; and
(2) receive, hold, and invest the proceeds of the
lease for the benefit of persons who are entitled or may become
entitled to those proceeds according to their respective rights and
interests.
(c) On the application of a person who has a vested,
contingent, or possible interest in land or an estate that is under
an oil, gas, or mineral lease and is subject to a contingent future
interest, a district court of the county in which all or part of the
land is located may appoint a receiver for the contingent future
interests, pending the occurrence of the contingency and the
vesting of the future interest, if:
(1) the lease fails to provide for pooling or contains
pooling provisions that are ineffective as to the contingent future
interest covered by the lease; and
(2) the pooling of the contingent future interest:
(A) is necessary to protect correlative rights;
(B) is necessary to prevent the physical or
economic waste of oil, gas, or other minerals;
(C) will inure to the benefit and advantage of
the persons entitled to the future interest; or
(D) is necessary for the conservation,
preservation, or protection of the land or estate or of a present,
contingent, or future interest in the land or estate.
(d) The lessee or an assignee of the lessee may apply for
appointment of a receiver under Subsection (c). As authorized or
directed by the court, the receiver appointed under that subsection
may:
(1) amend the lease to authorize pooling for the
contingent future interest on terms and conditions and for
additional consideration directed by the court; and
(2) receive, hold, and invest the additional
consideration for the benefit of the persons who are entitled or may
become entitled to that consideration, according to their
respective rights and interests.
(e) A court appointing a receiver under this section may
confer on the receiver all powers necessary to the exercise of the
receiver's authority.
(f) A lease executed or amended by a receiver under this
section may authorize the lessee and his assigns to pool all or part
of the land subject to the lease with adjacent land into a unit not
to exceed 160 acres for an oil well or 640 acres for a gas well plus
10 percent tolerance or into a unit that substantially conforms to a
larger unit prescribed or permitted by governmental rule.
(g) In an action for appointment of a receiver under this
section, a person who has a vested, contingent, or possible
interest in the land must be cited in the manner and for the time
provided for in actions concerning title to land. A person not in
being must be cited in the manner and for the time provided in
actions against unknown owners or claimants of interest in land. In
an action brought under Subsection (c), a person is not a necessary
party if:
(1) the person's interest in the land subject to the
lease is effectively subject to pooling authority under the lease;
and
(2) enlargement of the pooling authority as to the
person's interest is not sought.
(h) The court appointing a receiver under this section may
order that, after payment of court costs, money paid to the receiver
be deposited in the registry of the court for the use and benefit of
the persons who are entitled or may become entitled to the money,
according to their respective rights and interests. If the court
then discharges the receiver, it may order that later payments
under the lease accruing to the contingent future interest be
deposited in the same manner and for the same purpose.
(i) This section does not apply to a mineral lease on land on
which drilling began before October 5, 1949. This section does not
authorize a lease of mineral interests on land subject to existing
homestead rights without the written consent of the owner of the
homestead rights given in the manner provided by law for the
conveyance of homesteads.
(j) In this section, 'contingent future interest' means a
legal or equitable interest arising by way of remainder, reversion,
possibility of reverter, executory devise, on the occurrence of a
condition subsequent, or otherwise.
Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.
§ 64.093. RECEIVER FOR ROYALTY INTERESTS OWNED BY
NONRESIDENT OR ABSENTEE. (a) A district court may appoint a
receiver for the royalty interest owned by a nonresident or absent
defendant in an action that:
(1) is brought by a person claiming or owning an
undivided mineral interest in land in this state or an undivided
leasehold interest under a mineral lease of land in the state; and
(2) has one or more defendants who have, claim, or own
an undivided royalty interest in that property.
(b) The defendant for whom the receiver is sought must:
(1) be a person whose residence or identity is unknown
or a nonresident; and
(2) not have paid taxes on the interest or rendered it
for taxes during the five-year period immediately preceding the
filing of the action.
(c) The plaintiff in the action must allege by verified
petition and prove that the plaintiff:
(1) has made a diligent but unsuccessful effort to
locate the defendant; and
(2) will suffer substantial damage or injury unless
the receiver is appointed.
(d) In an action under Subsection (a):
(1) the plaintiff, in the petition, must name the last
known owner or the last record owner of the interest as defendant;
(2) the plaintiff must serve notice on the defendant
by publication as provided by the Texas Rules of Civil Procedure;
(3) the court may appoint as receiver the county
judge, the county clerk, or any other resident of the county in
which the land is located;
(4) notwithstanding the Texas Rules of Civil
Procedure, the applicant is not required to post bond; and
(5) the receiver is not required to post bond.
(e) A receivership created under this section continues as
long as the defendant or the defendant's heirs, assigns, or
personal representatives fail to appear in court in person or by
agent or attorney to claim the defendant's interest.
(f) As ordered by the court, the receiver shall immediately:
(1) ratify a mineral lease executed by a person owning
an undivided mineral interest in the property;
(2) ratify a pooling agreement executed by a person
owning an undivided mineral interest in the property or an
undivided leasehold interest in the property; or
(3) enter into a unitization agreement authorized by
the Railroad Commission of Texas.
(g) A lease ratified by a receiver under this section may
authorize the lessee to pool and unitize land subject to the lease
with adjacent land into a unit not to exceed 160 acres for an oil
well or 640 acres for a gas well plus 10 percent tolerance or into a
unit that substantially conforms to a larger unit prescribed or
permitted by governmental rule. A pooling agreement ratified by a
receiver under this section may allow a pooled unit not to exceed
160 acres for an oil well or 640 acres for a gas well plus 10 percent
tolerance or into a unit that substantially conforms to a larger
unit prescribed or permitted by governmental rule.
(h) The monetary consideration, if any, due for the
execution of a ratification, pooling agreement, or unitization
agreement by the receiver must be paid to the clerk of the court in
which the case is pending before the receiver executes the
instrument. It is, however, recognized that, because
ratifications, pooling agreements, and unitization agreements are
typically entered into in consideration of the future benefits
accruing to the grantor thereof, an initial monetary consideration
is not typically paid for the execution of such instruments. The
court shall apply the money to the costs accruing in the case and
retain any balance for the owner of the royalty interest. Payments
made at a later time under the lease, pooled unit, or unitization
agreement shall be paid into the registry of the court and impounded
for the owner of the royalty interest.
(i) This section is cumulative of other laws relating to
removal of a cloud from title or appointment of a receiver.
(j) In this section:
(1) 'Mineral lease' includes any lease of oil, gas, or
other minerals that contains provisions necessary or incident to
the orderly exploration, development, and recovery of oil, gas, or
other minerals.
(2) 'Leasehold interest' includes ownership created
under a mineral lease or carved out of a leasehold estate granted
under a mineral lease, including production payments, overriding
royalty interests, and working interests.
(3) 'Pooling agreement' includes any agreement that
pools or unitizes land with adjacent land for production of oil,
gas, or other minerals.
(4) 'Royalty interest' includes any interest in the
lands entitled to share in the production of oil, gas, or other
minerals that is not required to execute a mineral lease or any
other instrument in order to vest in the mineral interest owner or
mineral leasehold interest owner the right and power, as to that
interest, to develop oil, gas, or other minerals produced solely
from those lands.
(k) To the extent that Subsection (d)(2) conflicts with the
Texas Rules of Civil Procedure, Subsection (d)(2) controls.
Notwithstanding Section 22.004, Government Code, the supreme court
may not amend or adopt rules in conflict with Subsection (d)(2).
Added by Acts 1999, 76th Leg., ch. 1483, § 1, eff. Aug. 30, 1999.
SUBCHAPTER G. RECEIVER FOR CERTAIN MISSING PERSONS
§ 64.101. NOTICE AND CITATION FOR RECEIVERSHIP FOR
CERTAIN MISSING PERSONS. (a) On the filing of an application for
the appointment of a receiver for a missing person under Section
64.001(d), the court clerk shall issue a citation that states that
the application for receivership was filed and includes:
(1) the name of the missing person; and
(2) the name of the applicant.
(b) The citation must cite all persons interested in the
welfare of the missing person to appear at the time and place stated
in the notice for purposes of contesting the application. The
citation shall be posted.
(c) The citation shall be published in a newspaper of
general circulation:
(1) once in the county in which the missing person
resides; and
(2) once in each county in which property of the
missing person's estate is located.
Added by Acts 1999, 76th Leg., ch. 1081, § 5, eff. Sept. 1, 1999.
§ 64.102. PROCEEDING TO APPOINT RECEIVER. (a) The
court shall appoint an attorney ad litem to represent the interests
of a missing person at a proceeding to appoint a receiver for the
missing person under Section 64.001(d). To be eligible for
appointment as an attorney ad litem under this subsection, a person
must be certified in the same manner and to the same extent as a
person who is appointed as an attorney ad litem for a proposed ward
under Section 646, Texas Probate Code.
(b) The court may appoint a guardian ad litem for a missing
person if the court determines that the appointment would be in the
best interest of the missing person. A guardian ad litem appointed
under this subsection is an officer of the court. The guardian ad
litem shall protect the missing person in a manner that will enable
the court to determine the appropriate action to take in relation to
the best interest of the missing person.
(c) An attorney ad litem or a guardian ad litem appointed
under this section is entitled to reasonable compensation for
services in an amount set by the court to be charged as costs in the
proceeding.
(d) The cost of a proceeding instituted for the appointment
of a receiver for a missing person under Section 64.001(d) shall be
paid from the receivership, if a receivership is created. If the
court denies an application for appointment of a receiver, the
applicant shall pay the costs of the proceeding.
(e) The term of a receivership for a missing person granted
under Section 64.001(d) may not exceed six months unless, before
the expiration of the term and for good cause shown, the court
extends the receivership for another term not to exceed six months.
Added by Acts 1999, 76th Leg., ch. 1081, § 5, eff. Sept. 1, 1999.
§ 64.103. BOND. The bond under Section 64.023 required
to be executed by a receiver for a missing person appointed under
Section 64.001(d) must be set in an amount the court considers
necessary to protect the estate of the missing person.
Added by Acts 1999, 76th Leg., ch. 1081, § 5, eff. Sept. 1, 1999.
§ 64.104. EXPENDITURES BY RECEIVER. If, during the
receivership for a missing person under Section 64.001(d), the
needs of the spouse or dependent children of the missing person
require the use of the income or corpus of the estate for education,
clothing, or subsistence, the court may, with or without
application, by order entered in the minutes of the court,
appropriate an amount of the income or corpus sufficient for that
purpose. The income or corpus shall be used by the receiver to pay
claims for education, clothing, or subsistence that are presented
to the court and approved and ordered to be paid.
Added by Acts 1999, 76th Leg., ch. 1081, § 5, eff. Sept. 1, 1999.
§ 64.105. RECEIVER'S EXPENSES, ACCOUNT, AND
COMPENSATION. (a) All necessary expenses incurred by a receiver
appointed under Section 64.001(d) for a missing person in
administering the property shall be reported to the court at
intervals not longer than six months in length, as required by the
court, and shall be reported in an annual report filed not later
than the 60th day after the end of each calendar year if the court
extends the receivership in accordance with Section 64.102(e). The
report shall be made to the court by a sworn statement of account,
including a report of:
(1) the receiver's acts;
(2) the condition of the property;
(3) the status of the threatened danger to the
property; and
(4) the progress made toward abatement of the
threatened danger.
(b) If the court is satisfied that the statement is correct
and reasonable in all respects, the court shall promptly by order
approve the report and authorize the reimbursement of the receiver
from the funds under the receiver's control.
(c) For official services rendered, the receiver is
entitled to be compensated in the same manner and amount as is
provided by Chapter XIII, Texas Probate Code, for similar services
rendered by guardians of estates.
Added by Acts 1999, 76th Leg., ch. 1081, § 5, eff. Sept. 1, 1999.
§ 64.106. CLOSING RECEIVERSHIP. When the threatened
danger has abated and the estate of a missing person for whom a
receiver was appointed under Section 64.001(d) is no longer liable
to injury, loss, or waste for the lack of a representative or when
the receivership terminates under Section 64.102(e), whichever
occurs earlier, the receiver shall:
(1) report to the court; and
(2) file with the clerk a full and final sworn account
of:
(A) all property received by the receiver;
(B) all sums paid out;
(C) all acts performed by the receiver with
respect to the property; and
(D) all property remaining in the receiver's
control.
Added by Acts 1999, 76th Leg., ch. 1081, § 5, eff. Sept. 1, 1999.
§ 64.107. ACTION OF COURT. (a) If, on hearing the
report and account required under Section 64.106, the court is
satisfied that the danger of injury, loss, or waste has abated and
that the report and account are correct, the court shall render an
order finding that the danger has abated and that the report and
account are correct and shall direct the receiver to deliver the
property to the person from whom the receiver took possession as
receiver, to the missing person, or to another person the court
finds to be entitled to possession of the estate. The person to
whom the property is delivered shall execute and file with the clerk
an appropriate receipt for the property delivered.
(b) The order of the court shall discharge the receiver and
the receiver's sureties.
(c) If the court is not satisfied that the danger has
abated, or is not satisfied with the report and account, the court
shall render an order continuing the receivership in effect until
the court is satisfied that the danger has abated and that the
report and account are correct, subject to the limitation
prescribed by Section 64.102(e) for the extension of a
receivership.
Added by Acts 1999, 76th Leg., ch. 1081, § 5, eff. Sept. 1, 1999.
§ 64.108. RECORDATION OF PROCEEDINGS. All orders,
bonds, reports, accounts, and notices in the receivership
proceedings under this subchapter shall be recorded in the minutes
of the court.
Added by Acts 1999, 76th Leg., ch. 1081, § 5, eff. Sept. 1, 1999.
