HB350 Alabama 2024 Session

Summary

Primary Sponsor

David FaulknerRepresentative

Republican

Session

Regular Session 2024

Title

Alabama Uniform Commercial Real Estate Receivership Act, created, process for appointment of receiver for disputes relating to commercial real estate provided

Summary

The Alabama Uniform Commercial Real Estate Receivership Act creates a uniform process for courts to appoint a receiver to manage disputes over commercial real estate and related property.

What This Bill Does

It provides a framework for appointing a court receiver to protect and administer commercial real estate while disputes are resolved. It defines key terms, sets notice and hearing requirements, and outlines the receiver’s powers to collect, manage, operate, lease, sell, and preserve property, as well as duties to keep records and report to the court. It also establishes how receiverships can be started before judgment or during mortgage enforcement, how notices and claims from creditors are handled, how fees are paid, and how distributions are made to creditors with priority rules. The act applies to cases after January 1, 2025 and does not apply to receiverships started before that date.

Who It Affects

• Owners and mortgagors of commercial real estate may be required to preserve and turn over property and records to a court-appointed receiver, cooperate with the receiver, and follow court orders during the receivership.
• Creditors and lienholders (including mortgagees and unsecured creditors) with claims against the receivership property would receive notice, may file claims, participate in distributions by priority, and may object to or seek approval of the receiver's final report and fees.

Key Provisions

• Creates the Alabama Uniform Commercial Real Estate Receivership Act, establishing a uniform framework for appointment and powers of a receiver to manage real estate and related property.
• Provides definitions for key terms such as Receiver, Receivership, Mortgage, Mortgagee, Mortgagor, Owner, and Security Agreement.
• Gives courts authority to appoint a receiver before judgment or during mortgage enforcement to protect property from waste, loss, or impairment.
• Authorizes the receiver to collect, conserve, operate, lease, sell, license, and dispose of receivership property and to incur necessary expenses in the ordinary course.
• Requires interim and final reports, records-keeping, and accounting, with the receiver disclosing conflicts and seeking court approval for fees and professional engagements.
• Allows for bond or alternative security and provides protections for the state and for actions taken in good faith by the receiver.
• Establishes notice, claim filing, and distribution procedures for creditors, including priority-based distributions and potential unsecured creditor treatment.
• Imposes stay and injunction rules to protect the receivership, with certain statutory exceptions, and outlines remedies for violations.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Property & Estates