Florida Senate - 2020 SB 660 By Senator Berman 31-00405A-20 2020660__ 1 A bill to be entitled 2 An act relating to the Uniform Commercial Real Estate 3 Receivership Act; creating chapter 714, F.S., relating 4 to the Uniform Commercial Real Estate Receivership 5 Act; providing a short title; defining terms; 6 prohibiting a court from issuing certain orders unless 7 certain requirements are met; providing requirements 8 for certain court orders; authorizing certain parties 9 to move to dissolve or modify certain orders; 10 requiring that such motions be heard within a 11 specified timeframe; providing construction and 12 applicability; specifying that a court has exclusive 13 jurisdiction to direct receivers and determine 14 controversies under certain circumstances; providing 15 requirements and authorizations relating to the 16 appointment of a receiver; specifying when a person is 17 or is not disqualified from appointment as a receiver; 18 authorizing certain persons to nominate someone to 19 serve as a receiver; specifying the court is not bound 20 by such nomination; requiring a receiver to post a 21 bond with the court which meets certain requirements; 22 providing an exception; prohibiting a claim against a 23 receiver’s bond or alternative security from being 24 made after a certain time; providing that an appointed 25 receiver has certain statuses of a lien creditor; 26 providing that certain property is subject to 27 specified security agreements; providing requirements 28 relating to the collection and turnover of 29 receivership property; providing for powers and duties 30 of a receiver; authorizing the court to expand, 31 modify, or limit such powers and duties; providing for 32 duties of an owner; authorizing a court to take 33 certain actions if a person knowingly fails to perform 34 a duty; authorizing a court to take certain actions 35 relating to stays and injunctions; authorizing certain 36 persons to apply for relief from a stay or injunction; 37 specifying when an order does not operate as a stay or 38 injunction; authorizing receivers to engage and 39 compensate certain professionals under certain 40 circumstances; requiring certain persons to file an 41 itemized statement with the court; requiring a 42 receiver to pay an amount approved by the court; 43 defining the term “good faith”; authorizing a receiver 44 to use or transfer receivership property other than in 45 the ordinary course of business under certain 46 circumstances; providing for the service of notice to 47 lien holders who are not parties to the action; 48 defining the term “timeshare interest”; authorizing a 49 receiver to adopt or reject an executory contract of 50 the owner relating to receivership property under 51 certain circumstances; requiring that a claim of 52 damages for rejection of a contract be submitted 53 within a specified timeframe; authorizing a purchaser 54 to take certain actions if a receiver rejects an 55 executory contract under certain circumstances; 56 prohibiting a receiver from rejecting unexpired leases 57 of certain property under certain circumstances; 58 providing for defenses and immunities of a receiver; 59 providing requirements for interim reports filed by a 60 receiver; providing requirements relating to notices 61 of appointment; authorizing the court to enter certain 62 orders if the court concludes that receivership 63 property is likely to be insufficient to satisfy 64 certain claims; providing requirements for certain 65 distributions of receivership property; authorizing a 66 court to award fees and expenses; authorizing a court 67 to order certain persons to pay fees and expenses; 68 providing for the removal and replacement of a 69 receiver and the termination of a court’s 70 administration of the receivership property under 71 certain circumstances; requiring a receiver to file a 72 final report containing certain information upon 73 completion of the receiver’s duties; specifying that a 74 receiver is discharged if certain requirements are 75 met; authorizing a court to appoint ancillary 76 receivers under certain circumstances; providing for 77 rights, powers, and duties of an ancillary receiver; 78 specifying that certain requests, appointments, and 79 applications by a mortgagee do not have certain 80 effects; providing construction and applicability; 81 providing an effective date. 82 83 Be It Enacted by the Legislature of the State of Florida: 84 85 Section 1. Chapter 714, Florida Statutes, consisting of 86 sections 714.01-714.28, is created to read: 87 CHAPTER 714 88 UNIFORM COMMERCIAL REAL ESTATE RECEIVERSHIP ACT 89 714.01 Short title.—This chapter may be cited as the 90 Uniform Commercial Real Estate Receivership Act. 91 714.02 Definitions.—For the purposes of this chapter, the 92 term: 93 (1)“Affiliate” means: 94 (a) With respect to an individual: 95 1. A companion of the individual; 96 2. A lineal ancestor or descendent, whether by blood or 97 adoption, of: 98 a. The individual; or 99 b. A companion of the individual; 100 3. A companion of an ancestor or descendent as described in 101 subparagraph 2.; 102 4. A sibling, aunt, uncle, great aunt, great uncle, first 103 cousin, niece, nephew, grandniece, or grandnephew of the 104 individual, whether related by the whole or the half blood or 105 adoption, or a companion of any of them; or 106 5. Any other person occupying the residence of the 107 individual; and 108 (b) With respect to a person other than an individual: 109 1. Another person who directly or indirectly controls, is 110 controlled by, or is under common control with the person; 111 2. An officer, director, manager, member, partner, 112 employee, or trustee or other fiduciary of the person; or 113 3. A companion of an individual or an individual occupying 114 the residence of an individual. 115 (2) “Companion” means: 116 (a) The spouse of an individual; 117 (b) The registered domestic partner of an individual; or 118 (c) Another individual in a civil union with an individual. 119 (3) “Court” means the court of general equity jurisdiction 120 in this state. 121 (4) “Executory contract” means a contract, including a 122 lease, under which each party has an unperformed obligation and 123 the failure of a party to complete performance would constitute 124 a material breach. 125 (5) “Governmental unit” means an office, department, 126 division, bureau, board, commission, or other agency of this 127 state or a subdivision of this state. 128 (6) “Lien” means an interest in property which secures 129 payment or performance of an obligation. 130 (7) “Mortgage” means a record, however denominated, that 131 creates or provides for a consensual lien on real property or 132 rents, even if the record also creates or provides for a lien on 133 personal property. 134 (8) “Mortgagee” means a person entitled to enforce an 135 obligation secured by a mortgage. 136 (9) “Mortgagor” means a person who grants a mortgage or a 137 successor in ownership of the real property described in the 138 mortgage. 139 (10) “Owner” means the person for whose property a receiver 140 is appointed. 141 (11) “Person” means an individual, estate, business or 142 nonprofit entity, public corporation, government or governmental 143 subdivision, agency, or instrumentality or other legal entity. 144 (12) “Proceeds” means any of the following property: 145 (a) Whatever is acquired on the sale, lease, license, 146 exchange, or other disposition of receivership property. 147 (b) Whatever is collected on, or distributed on account of, 148 receivership property. 149 (c) Rights arising out of receivership property. 150 (d) To the extent of the value of receivership property, 151 claims arising out of the loss, nonconformity, or interference 152 with the use of, defects or infringement of rights in, or damage 153 to the property. 154 (e) To the extent of the value of receivership property and 155 to the extent payable to the owner or mortgagee, insurance 156 payable by reason of the loss or nonconformity of, defects or 157 infringement of rights in, or damage to the property. 158 (13) “Property” means all of a person’s right, title, and 159 interest, both legal and equitable, in real and personal 160 property, tangible and intangible, wherever located and however 161 acquired. The term includes proceeds, products, offspring, 162 rents, or profits of or from the property. 163 (14) “Receiver” means a person appointed by the court as 164 the court’s agent, and subject to the court’s direction, to take 165 possession of, manage, and, if authorized by this chapter or 166 court order, transfer, sell, lease, license, exchange, collect, 167 or otherwise dispose of receivership property. 168 (15) “Receivership” means a proceeding in which a receiver 169 is appointed. 170 (16) “Receivership property” means the property of an owner 171 which is described in the order appointing a receiver or a 172 subsequent order. The term includes any proceeds, products, 173 offspring, rents, or profits of or from the property. 174 (17) “Record,” if used as a noun, means information that is 175 inscribed on a tangible medium or that is stored on an 176 electronic or other medium and is retrievable in perceivable 177 form. 178 (18) “Rents” means: 179 (a) Sums payable for the right to possess or occupy, or for 180 the actual possession or occupation of, real property of another 181 person; 182 (b) Sums payable to a mortgagor under a policy of rental 183 interruption insurance covering real property; 184 (c) Claims arising out of a default in the payment of sums 185 payable for the right to possess or occupy real property of 186 another person; 187 (d) Sums payable to terminate an agreement to possess or 188 occupy real property of another person; 189 (e) Sums payable to a mortgagor for payment or 190 reimbursement of expenses incurred in owning, operating, and 191 maintaining real property or constructing or installing 192 improvements on real property; or 193 (f) Other sums payable under an agreement relating to the 194 real property of another person which constitute rents under the 195 laws of this state other than this act. 196 (19) “Secured obligation” means an obligation the payment 197 or performance of which is secured by a security agreement. 198 (20) “Security agreement” means an agreement that creates 199 or provides for a lien. 200 (21) “Sign” means, with present intent to authenticate or 201 adopt a record: 202 (a) To execute or adopt a tangible symbol; or 203 (b) To attach to or logically associate with the record an 204 electronic sound, symbol, or process. 205 (22) “State” means a state of the United States, the 206 District of Columbia, Puerto Rico, the United States Virgin 207 Islands, or any territory or insular possession subject to the 208 jurisdiction of the United States. 209 714.03 Notice and opportunity for hearing.— 210 (1) Except as otherwise provided in subsection (2), the 211 court may issue an order under this chapter only after notice 212 and opportunity for a hearing appropriate under the 213 circumstances. 214 (2) The court may issue an order under this chapter without 215 written or oral notice to the adverse party only if: 216 (a) It appears from the specific facts shown by affidavit 217 or verified pleading or motion that immediate and irreparable 218 injury, loss, or damage will result to the movant or that waste, 219 dissipation, impairment, or substantial diminution in value will 220 result to the subject real estate before any adverse party can 221 be heard in opposition; and 222 (b) The movant’s attorney certifies in writing all efforts 223 that have been made to give notice to all known adverse parties, 224 or the reasons why such notice should not be required. 225 (3) Only an affidavit, a declaration or a verified 226 pleading, or a motion may be used to support the application for 227 the appointment of a receiver, unless the adverse party appears 228 at the hearing or has received reasonable prior notice of the 229 hearing. Every order appointing a receiver without notice must 230 be endorsed with the date and hour of entry, must be filed 231 forthwith in the clerk’s office, must define the injury, must 232 state findings by the court as to why the injury may be 233 irreparable, and must give the reasons why the order was granted 234 without notice if notice was not given. The order appointing a 235 receiver shall remain in effect until the further order of the 236 court. 237 (4) An order appointing a receiver or providing for 238 injunctive relief may not be entered unless a bond is given by 239 the movant in an amount the court deems proper, conditioned for 240 the payment of costs and damages sustained by the adverse party 241 if the order is improperly entered. When any order appointing a 242 receiver or providing for injunctive relief is issued on the 243 pleading of a municipality or the state, or any officer, agency, 244 or political subdivision thereof, the court may require or 245 dispense with a bond, with or without surety, and conditioned in 246 the same manner, having due regard for the public interest. 247 (5) If the court grants injunctive relief, the injunction 248 must specify the reasons for entry, must describe in reasonable 249 detail the act or acts restrained without reference to a 250 pleading or another document, and must be binding on the parties 251 to the action; on the parties’ officers, agents, servants, 252 employees, and attorneys; and on any person in active concert or 253 participation with the parties who receives actual notice of the 254 injunction. 255 (6) A party adversely affected by an order appointing 256 receiver or for injunctive relief may move to dissolve or modify 257 the order at any time. If a party moves to dissolve or modify, 258 the motion shall be heard within 5 days after the movant applies 259 for a hearing on the motion. 260 (7) This chapter does not displace any existing rule of 261 procedural or judicial administration of this state governing 262 service or notice, including, without limitation, Rule 1.070, 263 Florida Rules of Civil Procedure and Rule 2.525, Florida Rules 264 of Judicial Administration, which shall remain in full force and 265 effect. 266 714.04 Scope; exclusions.— 267 (1) This chapter applies to a receivership initiated in a 268 court of this state for an interest in real property and any 269 personal property related to or used in operating the real 270 property. 271 (2) This chapter does not apply to: 272 (a) Actions in which a state agency or officer is expressly 273 authorized by statute to seek or obtain the appointment of a 274 receiver; 275 (b) Actions authorized by or commenced under federal law; 276 (c) Residential real property of an individual owner which 277 is occupied by the owner, the spouse of the owner, or a child or 278 other dependent of the owner; 279 (d) Property of an individual exempt from forced sale, 280 execution, or seizure under the laws of this state; or 281 (e) Personal property of an individual which is used 282 primarily for personal, family, or household purposes. 283 (3) This chapter does not limit the authority of a court to 284 appoint a receiver under the laws of this state other than this 285 chapter. 286 (4) This chapter does not limit an individual’s homestead 287 and exemption rights under the laws of this state or federal 288 law. 289 (5) Unless displaced by a particular provision of this 290 chapter, the principles of law and equity, including the law 291 relative to capacity to contract, principal and agent, estoppel, 292 laches, fraud, misrepresentation, duress, coercion, mistake, 293 bankruptcy, or other validating or invalidating cause, 294 supplement this chapter. 295 714.05 Power of the court.—The court that appoints a 296 receiver under this chapter has exclusive jurisdiction to direct 297 the receiver and determine any controversy related to the 298 receivership or receivership property. 299 714.06 Appointment of receiver.— 300 (1) The court may appoint a receiver: 301 (a) Before judgment, to protect a party that demonstrates 302 an apparent right, title, or interest in real property that is 303 the subject of the action, if the property or its revenue 304 producing potential: 305 1. Is being subjected to or is in danger of waste, loss, 306 substantial diminution in value, dissipation, or impairment; or 307 2. Has been or is about to be the subject of a voidable 308 transaction; 309 (b) After judgment: 310 1. To carry the judgment into effect; or 311 2. To preserve nonexempt real property pending appeal or 312 when an execution has been returned unsatisfied and the owner 313 refuses to apply the property in satisfaction of the judgment; 314 (c) In an action in which a receiver for real property may 315 be appointed on equitable grounds, subject to the requirements 316 of paragraphs (a) and (b); or 317 (d) During the time allowed for redemption, to preserve 318 real property sold in an execution or foreclosure sale and 319 secure its rents to the person entitled to the rents. 320 (2) In connection with the foreclosure or other enforcement 321 of a mortgage, the court shall consider the following facts and 322 circumstances, together with any other relevant facts, in 323 deciding whether to appoint a receiver for the mortgaged 324 property: 325 (a) Appointment is necessary to protect the property from 326 waste, loss, substantial diminution in value, transfer, 327 dissipation, or impairment; 328 (b) The mortgagor agreed in a signed record to the 329 appointment of a receiver on default; 330 (c) The owner agreed, after default and in a signed record, 331 to appointment of a receiver; 332 (d) The property and any other collateral held by the 333 mortgagee are not sufficient to satisfy the secured obligation; 334 (e) The owner fails to turn over to the mortgagee proceeds 335 or rents the mortgagee was entitled to collect; or 336 (f) The holder of a subordinate lien obtains appointment of 337 a receiver for the property. 338 (3) The court may condition the appointment of a receiver 339 without prior notice or hearing under s. 714.03 on the giving of 340 security by the person seeking the appointment for the payment 341 of damages, reasonable attorney fees, and costs incurred or 342 suffered by any person if the court later concludes that the 343 appointment was not justified. If the court later concludes that 344 the appointment was justified and the order of appointment of 345 the receiver becomes final and no longer subject to appeal, the 346 court shall release the security. 347 714.07 Disqualification from appointment as receiver; 348 disclosure of interest.— 349 (1) The court may not appoint a person as receiver unless 350 the person submits to the court a statement under penalty of 351 perjury that the person is not disqualified. 352 (2) Except as otherwise provided in subsection (3), a 353 person is disqualified from appointment as receiver if the 354 person: 355 (a) Is an affiliate of a party; 356 (b) Has an interest materially adverse to an interest of a 357 party; 358 (c) Has a material financial interest in the outcome of the 359 action, other than compensation the court may allow the 360 receiver; 361 (d) Has a debtor-creditor relationship with a party; or 362 (e) Holds an equity interest in a party, other than a 363 noncontrolling interest in a publicly traded company. 364 (3) A person is not disqualified from appointment as 365 receiver solely because the person: 366 (a) Was appointed receiver or is owed compensation in an 367 unrelated matter involving a party or was engaged by a party in 368 a matter unrelated to the receivership; 369 (b) Is an individual obligated to a party on a debt that is 370 not in default and was incurred primarily for personal, family, 371 or household purposes; or 372 (c) Maintains with a party a deposit account, as defined in 373 s. 679.1021. 374 (4) A person seeking appointment of a receiver may nominate 375 a person to serve as receiver, but the court is not bound by the 376 nomination. 377 714.08 Receiver’s bond; alternative security.— 378 (1) Except as otherwise provided in subsection (2), a 379 receiver shall post with the court a bond that: 380 (a) Is conditioned on the faithful discharge of the 381 receiver’s duties; 382 (b) Has one or more sureties approved by the court; 383 (c) Is in an amount the court specifies; and 384 (d) Is effective as of the date of the receiver’s 385 appointment. 386 (2) The court may approve the receiver posting an 387 alternative security with the court, such as a letter of credit 388 or deposit of funds. The receiver may not use receivership 389 property as alternative security. Interest that accrues on 390 deposited funds must be paid to the receiver upon the receiver’s 391 discharge. 392 (3) The court may authorize a receiver to act before the 393 receiver posts the bond or alternative security required by this 394 section if the action is necessary to prevent or mitigate 395 immediate injury, loss, or damage to the party who sought the 396 appointment of the receiver, or immediate waste, dissipation, 397 impairment, or substantial diminution in value to the 398 receivership property. 399 (4) A claim against a receiver’s bond or alternative 400 security must be made not later than 1 year after the date the 401 receiver is discharged. 402 714.09 Status of receiver as lien creditor.—Upon 403 appointment of a receiver, the receiver has the status of a lien 404 creditor under: 405 (1) Chapter 679 as to receivership property or fixtures; 406 and 407 (2) Chapter 695 as to receivership property that is real 408 property. 409 714.10 Security agreement covering after-acquired 410 property.—Except as otherwise provided by law other than this 411 chapter, property that a receiver or an owner acquires after 412 appointment of the receiver is subject to a security agreement 413 entered into before the appointment to the same extent as if the 414 court had not appointed the receiver. 415 714.11 Collection and turnover of receivership property.— 416 (1) Unless the court orders otherwise, on demand by a 417 receiver: 418 (a) A person that owes a debt that is receivership property 419 and is matured or payable on demand or on order shall pay the 420 debt to or on the order of the receiver, except to the extent 421 the debt is subject to setoff or recoupment; and 422 (b) Subject to subsection (3), a person that has 423 possession, custody, or control of receivership property shall 424 turn the property over to the receiver. 425 (2) A person that has notice of the appointment of a 426 receiver and owes a debt that is receivership property may not 427 satisfy the debt by payment to the owner. 428 (3) If a creditor has possession, custody, or control of 429 receivership property and the validity, perfection, or priority 430 of the creditor’s lien on the property depends on the creditor’s 431 possession, custody, or control, the creditor may retain 432 possession, custody, or control until the court orders adequate 433 protection of the creditor’s lien. 434 (4) Unless a bona fide dispute exists about a receiver’s 435 right to possession, custody, or control of receivership 436 property, the court may sanction as civil contempt a person’s 437 failure to turn the property over when required by this section. 438 714.12 Powers and duties of receiver.— 439 (1) Except as limited by court order or the laws of this 440 state other than this chapter, a receiver may: 441 (a) Collect, control, manage, conserve, and protect 442 receivership property; 443 (b) Operate a business constituting receivership property, 444 including preservation, use, sale, lease, license, exchange, 445 collection, or disposition of the property in the ordinary 446 course of business; 447 (c) In the ordinary course of business, incur unsecured 448 debt and pay expenses incidental to the receiver’s preservation, 449 use, sale, lease, license, exchange, collection, or disposition 450 of receivership property; 451 (d) Assert a right, claim, cause of action, or defense of 452 the owner which relates to receivership property; 453 (e) Seek and obtain instruction from the court concerning 454 receivership property, exercise of the receiver’s powers, and 455 performance of the receiver’s duties; 456 (f) Upon subpoena, compel a person to submit to examination 457 under oath, or to produce and permit inspection and copying of 458 designated records or tangible things, with respect to 459 receivership property or any other matter that may affect 460 administration of the receivership; 461 (g) Engage a professional pursuant to s. 714.15; 462 (h) Apply to a court of another state for appointment as 463 ancillary receiver with respect to receivership property located 464 in that state; and 465 (i) Exercise any power conferred by court order, this 466 chapter, or the laws of this state other than this chapter. 467 (2) With court approval, a receiver may: 468 (a) Incur debt for the use or benefit of receivership 469 property other than in the ordinary course of business; 470 (b) Make improvements to receivership property; 471 (c) Use or transfer receivership property other than in the 472 ordinary course of business pursuant to s. 714.16; 473 (d) Adopt or reject an executory contract of the owner 474 pursuant to s. 714.17; 475 (e) Pay compensation to the receiver pursuant to s. 714.21, 476 and to each professional engaged by the receiver under s. 477 714.15; 478 (f) Recommend allowance or disallowance of a claim of a 479 creditor pursuant to s. 714.20; and 480 (g) Make a distribution of receivership property pursuant 481 to s. 714.20. 482 (3) A receiver shall: 483 (a) Prepare and retain appropriate business records, 484 including a record of each receipt, disbursement, and 485 disposition of receivership property; 486 (b) Account for receivership property, including the 487 proceeds of a sale, lease, license, exchange, collection, or 488 other disposition of the property; 489 (c) File with the recording office of the county in which 490 the real property is located a copy of the order appointing the 491 receiver and, if a legal description of the real property is not 492 included in the order, the legal description; 493 (d) Disclose to the court any fact arising during the 494 receivership which would disqualify the receiver under s. 495 714.07; and 496 (e) Perform any duty imposed by court order, this chapter, 497 or the laws of this state other than this chapter. 498 (4) The powers and duties of a receiver may be expanded, 499 modified, or limited by court order. 500 714.13 Duties of owner.— 501 (1) An owner shall: 502 (a) Assist and cooperate with the receiver in the 503 administration of the receivership and the discharge of the 504 receiver’s duties; 505 (b) Preserve and turn over to the receiver all receivership 506 property in the owner’s possession, custody, or control; 507 (c) Identify all records and other information relating to 508 the receivership property, including a password, authorization, 509 or other information needed to obtain or maintain access to or 510 control of the receivership property, and make available to the 511 receiver the records and information in the owner’s possession, 512 custody, or control; 513 (d) Upon subpoena, submit to examination under oath by the 514 receiver concerning the acts, conduct, property, liabilities, 515 and financial condition of the owner or any matter relating to 516 the receivership property or the receivership; and 517 (e) Perform any duty imposed by court order, this chapter, 518 or the laws of this state other than this chapter. 519 (2) If an owner is a person other than an individual, this 520 section applies to each officer, director, manager, member, 521 partner, trustee, or other person exercising or having the power 522 to exercise control over the affairs of the owner. 523 (3) If a person knowingly fails to perform a duty imposed 524 by this section, the court may: 525 (a) Award the receiver actual damages caused by the 526 person’s failure, reasonable attorney fees, and costs; and 527 (b) Sanction the failure as civil contempt. 528 714.14 Stay; injunction.— 529 (1) Except as otherwise provided in subsection (4), after 530 notice and a hearing, the court may enter an order providing for 531 a stay, applicable to all persons, of any act, action, or 532 proceeding: 533 (a) To obtain possession of, exercise control over, or 534 enforce a judgment against all or a portion of the receivership 535 property as defined in the order creating the stay; and 536 (b) To enforce a lien against all or a portion of the 537 receivership property to the extent the lien secures a claim 538 against the owner which arose before entry of the order. The 539 court shall include in its order a specific description of the 540 receivership property subject to the stay, and shall include the 541 following language in the title of the order: “Order Staying 542 Certain Actions to Enforce Claims against Receivership 543 Property.” 544 (2) Except as otherwise provided in subsection (4), the 545 court may enjoin an act, action, or proceeding against or 546 relating to receivership property if the injunction is necessary 547 to protect against misappropriation of, or waste relating 548 directly to, the receivership property. 549 (3) A person whose act, action, or proceeding is stayed or 550 enjoined under this section may apply to the court for relief 551 from the stay or injunction. The court, after a hearing on 552 notice, may grant relief for cause shown. 553 (4) An order under subsection (1) or subsection (2) does 554 not operate as a stay or injunction of: 555 (a) Any act, action, or proceeding to foreclose or 556 otherwise enforce a mortgage by the person seeking appointment 557 of the receiver; 558 (b) Any act, action, or proceeding to perfect, or maintain 559 or continue the perfection of, an interest in receivership 560 property; 561 (c) Commencement or continuation of a criminal proceeding; 562 (d) Commencement or continuation of an action or 563 proceeding, or enforcement of a judgment other than a money 564 judgment, in an action or proceeding by a governmental unit to 565 enforce its police or regulatory power; or 566 (e) Establishment by a governmental unit of a tax liability 567 against the receivership property or the owner of such 568 receivership property, or an appeal of any such liability. 569 (5) The court may void an act that violates a stay or 570 injunction under this section. 571 (6) The scope of the receivership property subject to the 572 stay under subsection (1) may be modified upon request of the 573 receiver or other person, after a hearing on notice. 574 (7) In connection with the entry of an order under 575 subsection (1) or subsection (2), the court shall determine 576 whether an additional bond or alternative security will be 577 required as a condition to entry of the stay or injunction and, 578 if required, direct the party requesting the stay or injunction 579 to post a bond or alternative security as a condition for the 580 stay or injunction to become effective. 581 714.15 Engagement and compensation of professional.— 582 (1) With court approval, a receiver may engage an attorney, 583 an accountant, an appraiser, an auctioneer, a broker, or another 584 professional to assist the receiver in performing a duty or 585 exercising a power of the receiver. The receiver shall disclose 586 to the court: 587 (a) The identity and qualifications of the professional; 588 (b) The scope and nature of the proposed engagement; 589 (c) Any potential conflict of interest; and 590 (d) The proposed compensation. 591 (2) A person is not disqualified from engagement under this 592 section solely because of the person’s engagement by, 593 representation of, or other relationship with the receiver, a 594 creditor, or a party. This chapter does not prevent the receiver 595 from serving in the receivership as an attorney, an accountant, 596 an auctioneer, or a broker when authorized by law. 597 (3) A receiver or professional engaged under subsection (1) 598 shall file with the court an itemized statement of the time 599 spent, work performed, and billing rate of each person that 600 performed the work and an itemized list of expenses. The 601 receiver shall pay the amount approved by the court. 602 714.16 Use or transfer of receivership property not in 603 ordinary course of business.— 604 (1) For the purposes of this section, the term “good faith” 605 means honesty in fact and the observance of reasonable 606 commercial standards of fair dealing. 607 (2) Before judgment is entered with respect to the 608 receivership property, with court approval after notice to all 609 parties with an interest in the property, including all lien 610 holders, and a hearing, a receiver may use or transfer by sale, 611 lease, license, exchange, or other disposition receivership 612 property other than in the ordinary course of business only if 613 the owner of the property: 614 (a) After the commencement of the action in which the 615 receiver is appointed, expressly consents to the receiver’s 616 proposed use or transfer of the receivership property, and the 617 receiver notes the property owner’s express consent in the 618 motion to approve the proposed use or transfer; or 619 (b) Before or at the hearing on the receiver’s motion to 620 approve the use or transfer of the receivership property, fails 621 to object thereto after the receiver in good faith has provided 622 reasonable advance written notice to the property owner of the 623 proposed use or transfer, and the receiver demonstrates in the 624 motion that the proposed use or transfer is necessary to prevent 625 waste, loss, substantial diminution in value, dissipation, or 626 impairment of the property or its revenue-producing potential or 627 to prevent a voidable transaction involving the property. 628 629 Service of notice to lien holders who are not parties to the 630 action must be made as provided in chapter 48 for service of 631 original process. If service cannot be carried out in such 632 manner, upon authorization by court order, the receiver may 633 effect service of notice on the nonparty lien holder pursuant to 634 chapter 49 or as otherwise ordered by the court. 635 (3) After judgment is entered against the property owner 636 and with court approval, a receiver may use or transfer 637 receivership property other than in the ordinary course of 638 business to carry the judgment into effect or to preserve 639 nonexempt real property pending appeal or when an execution has 640 been returned unsatisfied and the owner refuses to apply the 641 property in satisfaction of the judgment. 642 (4) The court may order that a transfer of receivership 643 property under this section is free and clear of any liens on 644 the property at the time of the transfer. In such case, any 645 liens on the property, which were valid at the time of the 646 transfer but extinguished by the transfer, attach to the 647 proceeds of the transfer with the same validity, perfection, and 648 priority the liens had on the property immediately before the 649 transfer, even if the proceeds are not sufficient to satisfy all 650 obligations secured by the liens. 651 (5) A transfer under subsection (3) may occur by means 652 other than a public auction sale. A creditor holding a valid 653 lien on the property to be transferred may purchase the property 654 and offset against the purchase price part or all of the allowed 655 amount secured by the lien if the creditor tenders funds 656 sufficient to satisfy in full the reasonable expenses of 657 transfer and the obligation secured by any senior lien 658 extinguished by the transfer. 659 (6) A reversal or modification of an order approving a 660 transfer under subsection (3) does not affect the validity of 661 the transfer to a person that acquired the property in good 662 faith or revive against the person any lien extinguished by the 663 transfer, whether the person knew before the transfer of the 664 request for reversal or modification, unless the court stayed 665 the order before the transfer. 666 714.17 Executory contract.— 667 (1) For the purposes of this section, the term “timeshare 668 interest” has the same meaning as in s. 721.05(36). 669 (2) Except as otherwise provided in subsection (8), with 670 court approval, a receiver may adopt or reject an executory 671 contract of the owner relating to receivership property. The 672 court may condition the receiver’s adoption and continued 673 performance of the contract on terms appropriate under the 674 circumstances. If the receiver does not request court approval 675 to adopt or reject the contract within a reasonable time after 676 the receiver’s appointment, the receiver is deemed to have 677 rejected the contract. 678 (3) A receiver’s performance of an executory contract 679 before court approval under subsection (2) of its adoption or 680 rejection is not an adoption of the contract and does not 681 preclude the receiver from seeking approval to reject the 682 contract. 683 (4) A provision in an executory contract which requires or 684 permits a forfeiture, modification, or termination of the 685 contract because of the appointment of a receiver or the 686 financial condition of the owner does not affect a receiver’s 687 power under subsection (2) to adopt the contract. 688 (5) A receiver’s right to possess or use receivership 689 property pursuant to an executory contract terminates on 690 rejection of the contract under subsection (2). Rejection is a 691 breach of the contract effective immediately before appointment 692 of the receiver. A claim for damages for rejection of the 693 contract must be submitted by the later of: 694 (a) The time set for submitting a claim in the 695 receivership; or 696 (b) Thirty days after the court approves the rejection. 697 (6) If at the time a receiver is appointed, the owner has 698 the right to assign an executory contract relating to 699 receivership property under the laws of this state other than 700 this chapter, the receiver may assign the contract with court 701 approval. 702 (7) If a receiver rejects an executory contract for the 703 sale of receivership property that is real property in 704 possession of the purchaser or a real-property timeshare 705 interest pursuant to subsection (2), the purchaser may: 706 (a) Treat the rejection as a termination of the contract, 707 and in that case the purchaser has a lien on the property for 708 the recovery of any part of the purchase price the purchaser 709 paid; or 710 (b) Retain the purchaser’s right to possession under the 711 contract. If the purchaser retains his or her right to 712 possession pursuant to this paragraph, the purchaser must 713 continue to perform all obligations arising under the contract 714 and may offset any damages caused by nonperformance of an 715 obligation of the owner after the date of the rejection, but the 716 purchaser does not have a right or claim against other 717 receivership property or the receiver on account of the damages. 718 (8) A receiver may not reject an unexpired lease of real 719 property under which the owner is the landlord if: 720 (a) The tenant occupies the leased premises as the tenant’s 721 primary residence; 722 (b) The receiver was appointed at the request of a person 723 other than a mortgagee; or 724 (c) The receiver was appointed at the request of a 725 mortgagee and: 726 1. The lease is superior to the lien of the mortgage; 727 2. The tenant has an enforceable agreement with the 728 mortgagee or the holder of a senior lien under which the 729 tenant’s occupancy will not be disturbed as long as the tenant 730 performs its obligations under the lease; 731 3. The mortgagee has consented to the lease, either in a 732 signed record or by its failure to timely object that the lease 733 violated the mortgage; or 734 4. The terms of the lease were commercially reasonable at 735 the time the lease was agreed to and the tenant did not know or 736 have reason to know that the lease violated the mortgage. 737 714.18 Defenses and immunities of receiver.— 738 (1) A receiver is entitled to all defenses and immunities 739 provided by the laws of this state other than this chapter for 740 an act or omission within the scope of the receiver’s 741 appointment. 742 (2) A receiver may be sued personally for an act or 743 omission in administering receivership property only with 744 approval of the court that appointed the receiver. 745 714.19 Interim report of receiver.—A receiver may file or, 746 if ordered by the court, shall file an interim report that 747 includes: 748 (1) The activities of the receiver since appointment or a 749 previous report; 750 (2) Receipts and disbursements, including a payment made or 751 proposed to be made to a professional engaged by the receiver; 752 (3) Receipts and dispositions of receivership property; 753 (4) Fees and expenses of the receiver and, if not filed 754 separately, a request for approval of payment of the fees and 755 expenses; and 756 (5) Any other information required by the court. 757 714.20 Notice of appointment; claim against receivership; 758 distribution to creditors.— 759 (1) Except as otherwise provided in subsection (6), a 760 receiver shall give notice of appointment of the receiver to 761 creditors of the owner by: 762 (a) Deposit for delivery through first-class mail or other 763 commercially reasonable delivery method to the last known 764 address of each creditor; and 765 (b) Publication as directed by the court. 766 (2) Except as otherwise provided in subsection (6), the 767 notice required under subsection (1) must specify the date by 768 which each creditor holding a claim against the owner which 769 arose before appointment of the receiver must submit the claim 770 to the receiver. The date specified must be at least 90 days 771 after the later of notice under paragraph (1)(a) or last 772 publication under paragraph (1)(b). The court may extend the 773 period for submitting the claim. Unless the court orders 774 otherwise, a claim that is not timely submitted is not entitled 775 to a distribution from the receivership. 776 (3) A claim submitted by a creditor under this section 777 must: 778 (a) State the name and address of the creditor; 779 (b) State the amount and basis of the claim; 780 (c) Identify any property securing the claim; 781 (d) Be signed by the creditor under penalty of perjury; and 782 (e) Include a copy of any record on which the claim is 783 based. 784 (4) An assignment by a creditor of a claim against the 785 owner is effective against the receiver only if the assignee 786 gives timely notice of the assignment to the receiver in a 787 signed record. 788 (5) At any time before entry of an order approving a 789 receiver’s final report, the receiver may file with the court an 790 objection to a claim of a creditor, stating the basis for the 791 objection. The court shall allow or disallow the claim according 792 to the laws of this state other than this chapter. 793 (6) If the court concludes that receivership property is 794 likely to be insufficient to satisfy claims of each creditor 795 holding a perfected lien on the property, the court may order 796 that: 797 (a) The receiver need not give notice under subsection (1) 798 of the appointment to all creditors of the owner, but only such 799 creditors as the court directs; and 800 (b) Unsecured creditors need not submit claims under this 801 section. 802 (7) Subject to s. 714.21: 803 (a) A distribution of receivership property to a creditor 804 holding a perfected lien on the property must be made in 805 accordance with the creditor’s priority under the laws of this 806 state other than this chapter; and 807 (b) A distribution of receivership property to a creditor 808 with an allowed unsecured claim must be made as the court 809 directs according to the laws of this state other than this 810 chapter. 811 714.21 Fees and expenses.— 812 (1) The court may award a receiver from receivership 813 property the reasonable and necessary fees and expenses of 814 performing the duties of the receiver and exercising the powers 815 of the receiver. 816 (2) The court may order one or more of the following to pay 817 the reasonable and necessary fees and expenses of the 818 receivership, including reasonable attorney fees and costs: 819 (a) A person that requested the appointment of the 820 receiver, if the receivership does not produce sufficient funds 821 to pay the fees and expenses; or 822 (b) A person whose conduct justified or would have 823 justified the appointment of the receiver under s. 714.06(1)(a). 824 714.22 Removal of receiver; replacement; termination of 825 receivership.— 826 (1) The court may remove a receiver for cause. 827 (2) The court shall replace a receiver that dies, resigns, 828 or is removed. 829 (3) If the court finds that a receiver that resigns or is 830 removed, or the representative of a receiver that is deceased, 831 has accounted fully for and turned over to the successor 832 receiver all receivership property and has filed a report of all 833 receipts and disbursements during the service of the replaced 834 receiver, the replaced receiver is discharged. 835 (4) The court may discharge a receiver and terminate the 836 court’s administration of the receivership property if the court 837 finds that appointment of the receiver was improvident or that 838 the circumstances no longer warrant continuation of the 839 receivership. If the court finds that the appointment was sought 840 wrongfully or in bad faith, the court may assess against the 841 person that sought the appointment: 842 (a) The fees and expenses of the receivership, including 843 reasonable attorney fees and costs; and 844 (b) Actual damages caused by the appointment, including 845 reasonable attorney fees and costs. 846 714.23 Final report of receiver; discharge.— 847 (1) Upon completion of a receiver’s duties, the receiver 848 shall file a final report including: 849 (a) A description of the activities of the receiver in the 850 conduct of the receivership; 851 (b) A list of receivership property at the commencement of 852 the receivership and any receivership property received during 853 the receivership; 854 (c) A list of disbursements, including payments to 855 professionals engaged by the receiver; 856 (d) A list of dispositions of receivership property; 857 (e) A list of distributions made or proposed to be made 858 from the receivership for creditor claims; 859 (f) If not filed separately, a request for approval of the 860 payment of fees and expenses of the receiver; and 861 (g) Any other information required by the court. 862 (2) If the court approves a final report filed under 863 subsection (1) and the receiver distributes all receivership 864 property, the receiver is discharged. 865 714.24 Receivership in another state; ancillary 866 proceeding.— 867 (1) The court may appoint a receiver appointed in another 868 state, or that person’s nominee, as an ancillary receiver with 869 respect to property located in this state or subject to the 870 jurisdiction of the court for which a receiver could be 871 appointed under this chapter, if: 872 (a) The person or nominee would be eligible to serve as 873 receiver under s. 714.07; and 874 (b) The appointment furthers the person’s possession, 875 custody, control, or disposition of property subject to the 876 receivership in the other state. 877 (2) The court may issue an order that gives effect to an 878 order entered in another state appointing or directing a 879 receiver. 880 (3) Unless the court orders otherwise, an ancillary 881 receiver appointed under subsection (1) has the rights, powers, 882 and duties of a receiver appointed under this chapter. 883 714.25 Effect of enforcement by mortgagee.—A request by a 884 mortgagee for the appointment of a receiver, the appointment of 885 a receiver, or the application by a mortgagee of receivership 886 property or proceeds to the secured obligation does not: 887 (1) Make the mortgagee a mortgagee in possession of the 888 real property; 889 (2) Make the mortgagee an agent of the owner; 890 (3) Constitute an election of remedies which precludes a 891 later action to enforce the secured obligation; 892 (4) Make the secured obligation unenforceable; 893 (5) Limit any right available to the mortgagee with respect 894 to the secured obligation; or 895 (6) Constitute an action under chapter 702. 896 714.26 Uniformity of application and construction.—In 897 applying and construing this chapter, consideration must be 898 given to the need to promote uniformity of the law with respect 899 to its subject matter among states that have enacted a similar 900 law. 901 714.27 Relation to electronic signatures in global and 902 national commerce act.—This act modifies, limits, or supersedes 903 the Electronic Signatures in Global and National Commerce Act, 904 15 U.S.C. ss. 7001 et seq., but does not modify, limit, or 905 supersede s. 101(c) of that act, 15 U.S.C. s. 7001(c), or 906 authorize electronic delivery of any of the notices described in 907 s. 103(b) of that act, 15 U.S.C. s. 7003(b). 908 714.28 Transition.—This chapter does not apply to a 909 receivership for which the receiver was appointed before July 1, 910 2020. 911 Section 2. This act shall take effect July 1, 2020.