Chapter 24 - § 24.12 • RECEIVERS

• Jurisdiction: Colorado

§ 24.12 • RECEIVERS

§ 24.12.1—In General

Formerly it was held that no receiver could be appointed unless an action is pending.⁵⁴⁴ However, C.R.S. § 38-38-602(3), the predecessor of which was enacted in 1929⁵⁴⁵ provides: "Nothing in this article shall restrict the power of the court in the appointment of a receiver pursuant to existing law or pursuant to agreement between the parties." Similarly, Rule 66(d), added in 1991, provides, in part: "The appointment of a receiver may be the sole claim for relief in an action."

The appointment of a receiver is addressed to the sound discretion of the trial court, and absent an abuse of discretion, its decision will not be overturned upon review.⁵⁴⁶

§ 24.12.2—Appointment of Receiver Under Statute

Prior to sale: When an action has been commenced to foreclose a mortgage, deed of trust, or other instrument securing an indebtedness, a receiver of the property affected will be appointed upon application at any time prior to the sale, if it appears that the security is clearly inadequate or that the premises are in danger of being materially injured or reduced in value as security by removal, destruction, deterioration, accumulation of prior liens, or otherwise so as to render the security inadequate.⁵⁴⁷ (Formerly, it appears, mere inadequacy of security was not a sufficient ground for the appointment of a receiver.⁵⁴⁸ ) A receiver appointed before sale continues after sale unless otherwise directed by the court.⁵⁴⁹

During redemption period: During the period of redemption, in the case of waste committed or danger of waste or an actual probability of the security being rendered inadequate, a receiver may be appointed to take possession and preserve the property at any time after sale under foreclosure.⁵⁵⁰

§ 24.12.3—Appointment of Receiver Under Agreement

The parties to a deed of trust may provide for the appointment of a receiver in the event of default without regard to the adequacy or value of the property or the solvency of any party bound for its payment.⁵⁵¹ The fact that the mortgage debt has been extinguished by the sale of the property is not determinative of whether the right to appointment of a receiver under the deed of trust has also been terminated by the sale. A provision of the deed of trust authorizing the appointment of a receiver may still be operative, as a contract between the parties, even though the instrument itself has been surrendered to the public trustee.⁵⁵² In the absence of agreement allowing...