Tex. Codes » Business Organizations Code · TITLE 1. GENERAL PROVISIONS · CHAPTER 11. WINDING UP AND TERMINATION OF DOMESTIC ENTITY
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Tex. Bus. Orgs. Code § 11.404 (2026)

Appointment Of Receiver To Rehabilitate Domestic Entity

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Sec. 11.404. APPOINTMENT OF RECEIVER TO REHABILITATE DOMESTIC ENTITY. (a) Subject to Subsection (b), a court that has jurisdiction over the property and business of a domestic entity under Section 11.402(b) may appoint a receiver for the entity's property and business if:

(1) in an action by an owner or member of the domestic entity, it is established that:

(A) the entity is insolvent or in imminent danger of insolvency;

(B) the governing persons of the entity are deadlocked in the management of the entity's affairs, the owners or members of the entity are unable to break the deadlock, and irreparable injury to the entity is being suffered or is threatened because of the deadlock;

(C) the actions of the governing persons of the entity are illegal, oppressive, or fraudulent;

(D) the property of the entity is being misapplied or wasted; or

(E) with respect to a for-profit corporation, the shareholders of the entity are deadlocked in voting power and have failed, for a period of at least two years, to elect successors to the governing persons of the entity whose terms have expired or would have expired on the election and qualification of their successors;

(2) in an action by a creditor of the domestic entity, it is established that:

(A) the entity is insolvent, the claim of the creditor has been reduced to judgment, and an execution on the judgment was returned unsatisfied; or

(B) the entity is insolvent and has admitted in writing that the claim of the creditor is due and owing; or

(3) in an action other than an action described by Subdivision (1) or (2), courts of equity have traditionally appointed a receiver.

(b) A court may appoint a receiver under Subsection (a) only if:

(1) circumstances exist that are considered by the court to necessitate the appointment of a receiver to conserve the property and business of the domestic entity and avoid damage to interested parties;

(2) all other requirements of law are complied with; and

(3) the court determines that all other available legal and equitable remedies, including the appointment of a receiver for specific property of the domestic entity under Section 11.402(a), are inadequate.

(c) If the condition necessitating the appointment of a receiver under this section is remedied, the receivership shall be terminated immediately, the management of the domestic entity shall be restored to its managerial officials, and the receiver shall redeliver to the domestic entity all of its property remaining in receivership.

Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.

Amended by:

Acts 2011, 82nd Leg., R.S., Ch. 139 (S.B. 748), Sec. 20, eff. September 1, 2011.

Notes of Decisions
Cited in 22 cases (6 in the last 5 years), 2010–2025 · leading case: Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014).
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Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). · cites it 27× “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Est. of Price, 528 S.W.3d 591 (Tex. App.—Texarkana 2017). “" (emphasis added)); Tex Bus. Org. Code Ann. § 11.404(b) (West 2010) ("A court may appoint a receiver [to rehabilitate a do *594 mestic entity] only if: .”
Steven Spiritas v. Susan Davidoff, 459 S.W.3d 224 (Tex. App.—Dallas 2015). “See Tex. Bus. Orgs. Code Ann. § 11.404 . Finally, we address section 11.”
Herring Bancorp, Inc. v. Mikkelsen, 529 S.W.3d 216 (Tex. App.—Amarillo 2017). “See also Tex. Bus. Orgs. Code Ann. § 11.404 (West 2012).”
Yaghoub \Jacob\" Kohannim v. Parvaneh Katoli", 440 S.W.3d 798 (Tex. App.—El Paso 2013). “404 indicates that an oppression action can be directed at the directors or “those in control” of the entity.”
Four Seasons Equip., Inc. v. White (In Re White), 429 B.R. 201 (Bankr. S.D. Tex. 2010). “Tex. Bus. ORg.Code § 11.404(b). The Texas legislature has declared that a liquidating receivership should be imposed “only if .”
William H. Scurlock v. John M. Hubbard, No. 06-15-00014-CV (Tex. App.—Texarkana Mar. 20, 2015). · cites it 9× “Tab 1 Selected Texas Rules and Statutes Tex. Bus. Orgs. Code Ann. §§11.404 , 21.218, 21.”
Ovation Fin. Holdings 5 LLC v. G.E.T. Mktg., LLC, No. 07-23-00398-CV (Tex. App.—Amarillo Apr. 15, 2024). · cites it 5× “” TEX. BUS. ORGS. CODE ANN. § 11.404(a), the legislature merely allowed the court to place a receiver in the shoes of the insolvent entity.”
Hansen v. African Contract Solutions Inc, No. 3:20-cv-00969 (N.D. Tex. May 4, 2020). · cites it 3× “15 TEX. BUS. ORGS. CODE § 11.404(b)(2). Additionally, before appointing a receiver, the state court must also determine that “circumstances exist that are considered by the court to necessitate the appointment of a receiver to conserve the property and business of the domestic…”
Lauro Chapa SR., Scorpion Expl. & Prod., INC., Pintamor, LTD., Piedras Pintas Ranch, LTD., Scorpion Drilling, INC., Scorpion Operating, INC., Scorpion Well Serv., INC., & Chapco, INC. v. Lauro Chapa JR., No. 04-12-00519-CV, 2012 WL 6728242 (Tex. App.—San Antonio Dec. 28, 2012). · cites it 5× “TEX. BUS. ORGS. CODE ANN. §§ 11.404, 11.405 (West 2012).”
Wes Gilbreath, Jr. v. Lisa R. Gilbreath Horan, 682 S.W.3d 454 (Tex. App.—Houston [1st Dist.] 2023). · cites it 2× “TEX. BUS. ORGS. CODE § 11.404. Relevant to this appeal, Section 11.”
William H. Scurlock v. John M. Hubbard, No. 06-15-00014-CV (Tex. App.—Texarkana Apr. 23, 2015). · cites it 3× “l5 , 16 Tex. R. Civ. Proc. 684 ...................”
Show all 22 citing cases →
Tex. Bus. Orgs. Code § 11.404(A)(1)(C): 2 cases
In re T. Bently Durant; Thomas R. Durant; The Durant Classic Dynasty Trust; Michael A. Ward; 8100 Partners, Ltd.; 8100 Mgmt. LLC; 8705 Partners, Ltd.; 8705 Mgmt. LLC; Classic Chevrolet Sugar Land LLC; Classic Chevrolet West Houston, LLC; Classic Elite Buick GMC, Inc.; & 16835 Cadet Partners, LLC v. the State of Texas, No. 15-25-00019-CV (Tex. App.—15th Dist. Mar. 21, 2025).
In re T. Bently Durant; Thomas R. Durant; The Durant Classic Dynasty Trust; Michael A. Ward; 8100 Partners, Ltd.; 8100 Mgmt. LLC; 8705 Partners, Ltd.; 8705 Mgmt. LLC; Classic Chevrolet Sugar Land LLC; Classic Chevrolet West Houston, LLC; Classic Elite Buick GMC, Inc.; & 16835 Cadet Partners, LLC v. the State of Texas, No. 15-25-00019-CV (Tex. App.—15th Dist. Mar. 18, 2025).
Tex. Bus. Orgs. Code § 11.404(a): 2 cases
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Ovation Fin. Holdings 5 LLC v. G.E.T. Mktg., LLC, No. 07-23-00398-CV (Tex. App.—Amarillo Apr. 15, 2024). “” TEX. BUS. ORGS. CODE ANN. § 11.404(a), the legislature merely allowed the court to place a receiver in the shoes of the insolvent entity.”
Tex. Bus. Orgs. Code § 11.404(a)(1): 2 cases
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Lauro Chapa SR., Scorpion Expl. & Prod., INC., Pintamor, LTD., Piedras Pintas Ranch, LTD., Scorpion Drilling, INC., Scorpion Operating, INC., Scorpion Well Serv., INC., & Chapco, INC. v. Lauro Chapa JR., No. 04-12-00519-CV, 2012 WL 6728242 (Tex. App.—San Antonio Dec. 28, 2012). “TEX. BUS. ORGS. CODE ANN. §§ 11.404, 11.405 (West 2012).”
Tex. Bus. Orgs. Code § 11.404(a)(1)(A): 4 cases
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Ovation Fin. Holdings 5 LLC v. G.E.T. Mktg., LLC, No. 07-23-00398-CV (Tex. App.—Amarillo Apr. 15, 2024). “” TEX. BUS. ORGS. CODE ANN. § 11.404(a), the legislature merely allowed the court to place a receiver in the shoes of the insolvent entity.”
Hillwood Inv. Props. III, Ltd v. Radical Mavericks Mgmt., LLC, No. 05-11-01470-CV, 2014 WL 4294968 (Tex. App.—Dallas Aug. 21, 2014).
Justin Lane v. Thomas Derwood Lane, No. 06-12-00048-CV (Tex. App.—Texarkana Sept. 4, 2012).
Tex. Bus. Orgs. Code § 11.404(a)(1)(C): 1 case
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Tex. Bus. Orgs. Code § 11.404(a)(1)(c): 2 cases
Wes Gilbreath, Jr. v. Lisa R. Gilbreath Horan, No. 01-17-00316-CV (Tex. App.—Houston [1st Dist.] July 15, 2022).
Wes Gilbreath, Jr. v. Lisa R. Gilbreath Horan, 682 S.W.3d 454 (Tex. App.—Houston [1st Dist.] 2023). “TEX. BUS. ORGS. CODE § 11.404. Relevant to this appeal, Section 11.”
Tex. Bus. Orgs. Code § 11.404(a)(3): 1 case
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Tex. Bus. Orgs. Code § 11.404(a)(l)(A): 1 case
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Tex. Bus. Orgs. Code § 11.404(b): 5 cases
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Est. of Price, 528 S.W.3d 591 (Tex. App.—Texarkana 2017). “" (emphasis added)); Tex Bus. Org. Code Ann. § 11.404(b) (West 2010) ("A court may appoint a receiver [to rehabilitate a do *594 mestic entity] only if: .”
Four Seasons Equip., Inc. v. White (In Re White), 429 B.R. 201 (Bankr. S.D. Tex. 2010). “Tex. Bus. ORg.Code § 11.404(b). The Texas legislature has declared that a liquidating receivership should be imposed “only if .”
Lauro Chapa SR., Scorpion Expl. & Prod., INC., Pintamor, LTD., Piedras Pintas Ranch, LTD., Scorpion Drilling, INC., Scorpion Operating, INC., Scorpion Well Serv., INC., & Chapco, INC. v. Lauro Chapa JR., No. 04-12-00519-CV, 2012 WL 6728242 (Tex. App.—San Antonio Dec. 28, 2012). “TEX. BUS. ORGS. CODE ANN. §§ 11.404, 11.405 (West 2012).”
Natin Paul WC 1st & Trinity, LP WC 1st & Trinity, GP, LLC WC 3rd & Cong., LP & WC 3rd & Cong., GP, LLC v. Roy F. & JoAnn Cole Mitte Found., No. 03-21-00502-CV, 2023 WL 1806101 (Tex. App.—Austin Feb. 8, 2023).
Tex. Bus. Orgs. Code § 11.404(b)(1): 2 cases
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Ovation Fin. Holdings 5 LLC v. G.E.T. Mktg., LLC, No. 07-23-00398-CV (Tex. App.—Amarillo Apr. 15, 2024). “” TEX. BUS. ORGS. CODE ANN. § 11.404(a), the legislature merely allowed the court to place a receiver in the shoes of the insolvent entity.”
Tex. Bus. Orgs. Code § 11.404(b)(2): 2 cases
Hansen v. African Contract Solutions Inc, No. 3:20-cv-00969 (N.D. Tex. May 4, 2020). “15 TEX. BUS. ORGS. CODE § 11.404(b)(2). Additionally, before appointing a receiver, the state court must also determine that “circumstances exist that are considered by the court to necessitate the appointment of a receiver to conserve the property and business of the domestic…”
Ovation Fin. Holdings 5 LLC v. G.E.T. Mktg., LLC, No. 07-23-00398-CV (Tex. App.—Amarillo Apr. 15, 2024). “” TEX. BUS. ORGS. CODE ANN. § 11.404(a), the legislature merely allowed the court to place a receiver in the shoes of the insolvent entity.”
Tex. Bus. Orgs. Code § 11.404(b)(3): 2 cases
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Cent. Austin Apts., LLC v. UP Austin Holdings, LP, No. 03-13-00080-CV (Tex. App.—Austin Dec. 9, 2014).
Tex. Bus. Orgs. Code § 11.404(b)(l): 1 case
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
Tex. Bus. Orgs. Code § 11.404(c): 1 case
Lee C. Ritchie v. Ann Caldwell Rupe, 443 S.W.3d 856 (Tex. 2014). “6 See Tex. Bus. Orgs. Code § 11.404. Although Rupe sought appointment of a receiver to liquidate RIC rather than rehabilitate it, 7 only sought that remedy as an alternative to other remedies, did not obtain that relief in the judgment, and does not request that relief on…”
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