Chap. 384.—An ACT to require notice when application is made for appointment
of receivers, and to provide for appointment of receivers in emergency cases,
and to require certain notices, settlements and reports. [H B 98]

Approved March 30, 1934

1. Be it enacted by the General Assembly of Virginia, That when-
ever the pleadings in any suit make out a proper case for the appoint-
ment of a receiver and application is made therefor to any court or
judge, such court or judge shall designate the time and place for hear-
ing such application, and shall require reasonable notice thereof to be
given to the defendant and to all other parties having a substantial
interest, either as owners of or lienors of record and lienors known to
the plaintiff, in the subject matter. It shall be the duty of the court
or judge to whom such application is made to inquire particularly of
the applicant as to the parties so substantially interested in the subject
matter, and such applicant, for any intentional or wilful failure to fully
disclose all material information relating to such inquiry, may be ad-
judged in contempt of court.

2. But the foregoing provision shall not apply to those cases in
which an emergency exists and it is necessary that a receiver be imme-
diately appointed to preserve the subject matter. In such emergency
cases a receiver may be appointed and the order of appointment shall
state the emergency and necessity for immediate action, and shall require
bond in proper amount of the applicant or some one for him with

sufficient surety conditioned to protect and save harmless the owners,
lienors and creditors lien or general in the subject matter taken over
by the receiver from all damages and injury properly and naturally
flowing from such emergency appointment of a receiver. Such emer-
gency appointment shall be limited to a period of not longer than
thirty days, during which period notice shall be given by the applicant
to all parties having a substantial interest, either as owner of or lienor
in the subject matter, of any motion to extend such receivership; and
upon the hearing on such motion, the court or judge shall hear the
matter de novo, and shall discharge such receiver, or shall appoint the
same receiver, or other receivers to act with him, or new receivers as to
the court or judge may seem right. Unless such receivership shall be so
extended, all the rights and powers of such emergency receiver over
the subject matter, at the end of such period for which he shall have
been appointed, shall cease and determine, and said receiver shall forth-
with file with said court an account of his dealing with said estate.
The notices required to be given under this act shall be served, as to
residents of this State, in any of the modes prescribed by section six
thousand and forty-one of the Code of Virginia, and as to non-residents
of this State, or persons unknown, or in any case in which the number
of persons to be given notice exceeds thirty, in the manner prescribed
by section six thousand and forty-three of said Code, except that publi-
cation in a newspaper need be for only two successive weeks instead of
four successive weeks as prescribed by said section.

In any suit matured and docketed in which the bill or petition prays
for the appointment of a receiver, no notice shall be required under this
act to be given to any defendant upon whom process to answer said bill
or petition shall have been served.

When a receiver has been appointed he shall immediately prepare
or cause to be prepared a list of all creditors, lien and general, of the
person, firm or corporation, for which he is receiver; and the court may
by proper order compel any defendant for whom a receiver is appointed,
or any officer of the corporation if a corporation be the defendant for
whom the receiver is appointed, to furnish or deliver to the receiver a
list, duly sworn to, of all creditors, lien or general, together with their
addresses if known. The receiver shall then promptly notify by mail
each creditor whose name and address has been ascertained of the
appointment of the receiver. No court shall order the sale of any
assets of the receivership until a receiver has reported to the court in
writing that he has mailed such notices to such creditors at least five
days prior to the filing of such report, except that the court may at any
time permit the sale of perishable or seasonal goods where necessary
to preserve the estate, or may permit the receiver to conduct the busi-
ness for which he is receiver, as a going business and to sell in the
usual course of said business.

When a permanent receiver is appointed he shall not be required to
make a new list of creditors if a temporary receiver or a prior receiver
appointed in the same proceedings has already prepared one, nor shal
he be required to mail other notices to creditors if such prior receive:
shall have previously mailed such notices,