§ 64.072.Limited Duration

A duration limit, and the structure is a rule with widening exceptions.

A court may not administer a corporation in receivership for more than three years after the receiver is appointed, and the court shall wind up the affairs of the corporation within that period.

The limit exists because receiverships tend to persist. A receiver drawing compensation from the estate has no incentive to conclude, and an indefinite administration consumes what it was appointed to preserve.

"Shall wind up ... within that period" makes the three years a duty rather than a mere ceiling.

Two grounds support an extension: litigation prevents the court from winding up within three years, or the receiver is operating the corporation as a going concern.

The second is the one that swallows the rule in practice. A receiver running a business is by definition not winding it up, and a profitable receivership can meet that ground indefinitely.

The procedure is protective. An application is required, notice to all attorneys of record, a hearing, and an order entered in the court’s minutes — and the court may prescribe conditions as the best interests of all concerned require.

The outer limit is five years beyond the original three, so eight years in total.

Two categories escape even that. Corporations organised under specified predecessor corporation statutes before September 1, 2009, and railroad corporations, may be extended for any additional period.

The railroad exception is not theoretical — the chapter contains a separate provision for terminating a railroad receivership that has run more than 50 years.