Mechanism 56
Opposing a pre-judgment receiver
Can a Texas court appoint a receiver over a business before anyone has won?
It can, and it should almost never do it. A pre-judgment receivership over an operating company is not a collection device — it is a business-ending event imposed before anyone has proved anything, and the Supreme Court of Texas has called receivership one of the harshest remedies known to the law, available only in extraordinary circumstances where no lesser remedy will serve.
By John P. Henry · Tex. Civ. Prac. & Rem. Code ch. 64; Tex. R. Civ. P. 695; Jones v. Strayhorn, 321 S.W.2d 290 (Tex. 1959) · Reviewed 2026-08-02
The authority
Receivership is one of the harshest remedies known to the law.Jones v. Strayhorn, 159 Tex. 421, 321 S.W.2d 290, 294 (Tex. 1959)
Tex. Civ. Prac. & Rem. Code ch. 64; Tex. R. Civ. P. 695; Jones v. Strayhorn, 321 S.W.2d 290 (Tex. 1959)
When it applies
The application filed alongside a fraud petition, the partnership dispute where one side wants the other out of the building, the investor suit that seeks control before liability. It is a pressure tactic more often than a remedy.
How it is proved up
- Lead with the standard rather than the facts. Extraordinary circumstances and no adequate alternative remedy is a high bar, and applicants frequently plead as though it were a balancing test.
- Identify the lesser remedy available — an accounting, a temporary injunction, an agreed escrow, a bond. The existence of one is close to dispositive.
- Insist on Rule 695 notice. Except where the statute allows otherwise, a receiver over property may not be appointed without notice to the adverse party.
- Attack the applicant’s standing to the specific property. Receivership statutes are property-specific and applications are often drafted to sweep in everything the defendant owns.
- Put the harm on the record — payroll, customer contracts, licences, financing covenants that a receivership breaches. Courts respond to concrete consequences.
What defeats it
- Genuine dissipation of assets that nothing else will stop.
- A statutory ground squarely met, which the harshness language does not override.
- A defendant whose own conduct — spoliation, transfers to insiders, defiance of orders — supplies the extraordinary circumstances.
- A record that never confronts the alternative remedies.
Where I have used it
An application to appoint a receiver over an operating company arrives as an emergency and is argued as a balancing test. It is not one. The answer is almost always the same three moves — the Strayhorn standard, the lesser remedy that is plainly available, and the notice Rule 695 requires — and they are worth having ready before the hearing that will be set on two days’ notice.
Questions
When can a Texas court appoint a receiver before judgment?
Only in the circumstances chapter 64 of the Civil Practice and Remedies Code allows, and only where the property is in danger of being lost, removed or materially injured and no other adequate remedy exists. It is treated as an extraordinary remedy.
Is notice required before a receiver is appointed in Texas?
Tex. R. Civ. P. 695 requires notice to the adverse party before a receiver may be appointed to take charge of property, except where a statute provides otherwise.
What is the difference between a pre-judgment and a post-judgment receiver?
A post-judgment receiver under Tex. Civ. Prac. & Rem. Code § 31.002 aids collection of an established judgment. A pre-judgment receiver takes control of property before anyone has been found liable, which is why the standard is far higher.