Receivers are agents of the court and may be appointed only when authorized by statute. (Marsch v. Williams (1994) 23 Cal.App.4th 238, 245.) A receiver is appointed to take charge and manage property which is subject to litigation, for the purpose of its preservation and disposition according to the final judgment. (Code of Civ. Proc., § 564.)

Legal Standard

The court may appoint a receiver where there is evidence that a plaintiff has at least a probable right or interest in the property sought to be placed in receivership and that the property is in danger of destruction, removal or misappropriation. (Sachs v. Killeen (1958) 165 Cal.App.2d 205, 213.)

“A receiver may be appointed by the court in which an action or proceeding is pending, or by a judge thereof, in the following cases:

1. In an action by a vendor to vacate a fraudulent purchase of property, or by a creditor to subject any property or fund to the creditor's claim, or between partners or others jointly owning or interested in any property or fund, on the application of the plaintiff, or of any party whose right to or interest in the property or fund, or the proceeds thereof, is probable, and where it is shown that the property or fund is in danger of being lost, removed, or materially injured.
2. In an action by a secured lender for the foreclosure of a deed of trust or mortgage and sale of property upon which there is a lien under a deed of trust or mortgage, where it appears that the property is in danger of being lost, removed, or materially injured, or that the condition of the deed of trust or mortgage has not been performed, and that the property is probably insufficient to discharge the deed of trust or mortgage debt.
3. After judgment, to carry the judgment into effect.
4. After judgment, to dispose of the property according to the judgment, or to preserve it during the pendency of an appeal, or pursuant to the Enforcement of Judgments Law (Title 9 (commencing with Section 680.010 )), or after sale of real property pursuant to a decree of foreclosure, during the redemption period, to collect, expend, and disburse rents as directed by the court or otherwise provided by law.
5. Where a corporation has been dissolved, as provided in Section 565.
6. Where a corporation is insolvent, or in imminent danger of insolvency, or has forfeited its corporate rights.
7. In an action of unlawful detainer.
8. At the request of the Public Utilities Commission pursuant to Section 855 or 5259.5 of the Public Utilities Code.
9. In all other cases where necessary to preserve the property or rights of any party.
10. At the request of the Office of Statewide Health Planning and Development, or the Attorney General, pursuant to Section 129173 of the Health and Safety Code.
11. In an action by a secured lender for specific performance of an assignment of rents provision in a deed of trust, mortgage, or separate assignment document. The appointment may be continued after entry of a judgment for specific performance if appropriate to protect, operate, or maintain real property encumbered by a deed of trust or mortgage or to collect rents therefrom while a pending nonjudicial foreclosure under power of sale in a deed of trust or mortgage is being completed.
12. In a case brought by an assignee under an assignment of leases, rents, issues, or profits pursuant to subdivision (g) of Section 2938 of the Civil Code.”

(Code of Civ. Proc., § 564(b).)

The moving party has the burden of showing that there is a danger of irreparable injury to the moving party and that the receivership is necessary to prevent the injury. (Alhambra-Shumway Mines, Inc. v. Alhambra Gold Mine Corp. (1953) 116 Cal. App. 2d 869, 873-874.) The moving papers must allege facts establishing one of the statutory grounds for appointment of a receiver. (Miller v. Oliver (1917) 714 Cal. 407, 410.) “Evidence to justify the appointment of a receiver may be presented ‘in the form of allegations in a complaint or other pleading, by affidavit or by testimony.’” (Armbrust v. Armbrust (1946) 75 Cal.App.2d 272, 274-275.)

The appointment of a receiver rests largely in the discretion of the trial court. (Maggiora v. Palo Alto Inn, Inc., (1967) 249 Cal.App.2d 706, 710.) The “power to appoint a receiver is a delicate one which is exercised sparingly and with caution, and only in an extreme case under such circumstances as demand or require summary relief, and never in a doubtful case or where there is no necessity or occasion for the appointment." (Morand v. Superior Court (1974) 38 Cal.App.3d 347, 350.) In determining whether to appoint a receiver, the Court considers the availability and efficacy of other remedies in determining whether to employ the extraordinary remedy of a receivership. (City & County of S.F. v. Daley (1993) 16 Cal. App. 4th 734, 745.) Ordinarily, if there is any other remedy, less severe in its results, which will adequately protect the rights of the parties, a Court should not take property out of the hands of its owners. (Alhambra-Shumway Mines, Inc. v. Alhambra Gold Mine Corp. (1953) 116 Cal. App. 2d 869, 873.)

Oath of Receiver

“Before entering upon the duties of a receiver:

1. The receiver must be sworn to perform the duties faithfully.
2. The receiver shall give an undertaking to the State of California, in such sum as the court or judge may direct, to the effect that the receiver will faithfully discharge the duties of receiver in the action and obey the orders of the court therein. The receiver shall be allowed the cost of the undertaking.”

(Code of Civ. Proc., § 567.)