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Receiverships Act 1993

Local authorities and water organisations

40B: Power of court to appoint receiver

You could also call this:

"The court can appoint a helper to manage assets when someone owes money and can't pay."

Illustration for Receiverships Act 1993

The High Court can appoint a receiver to manage assets of a local authority, Watercare, or a water organisation if a creditor asks for it. You can think of a receiver like a person who helps take care of someone's belongings when they are not able to. The court will decide how long the receiver is in charge and what powers they have.

When the court makes this decision, it must think about what is best for everyone involved, including the local authority, Watercare, or water organisation, and the people who live in the area. The court also has to consider the interests of creditors, which are people who are owed money.

The court's decision will be based on what is fair and reasonable in each situation. It will also consider the need to provide essential services, like water and healthcare, to the public. If you want to know more about what "Auckland" or "service area" means, you can look at the Local Government (Auckland Council) Act 2009 or the Local Government (Water Services) Act 2025.

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This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM327779.

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40A: Instrument may provide for appointment of receiver, or

"A lender can appoint someone to manage assets if a borrower can't pay back a loan."

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40C: Powers and duties of receivers, or

"What a receiver can and must do when in charge of someone's assets"

40BPower of court to appoint receiver

  1. Subject to sections 40D and 40E and this section, the High Court may,—

  2. on the application of any creditor of a local authority, appoint a receiver of any asset of the local authority or appoint a receiver for the purposes of section 115 of the Local Government Act 2002:
    1. on the application of any creditor of Watercare, appoint a receiver of any asset of Watercare or appoint a receiver for the purposes of section 60A of the Local Government (Auckland Council) Act 2009:
      1. on the application of any creditor of a water organisation, appoint a receiver of any asset of a water organisation or appoint a receiver for the purposes of section 253 of the Local Government (Water Services) Act 2025.

        1. An appointment under subsection (1) must be for the period, and with the rights, powers, and duties, and on any terms and conditions, including as to security and remuneration, that the court considers appropriate in all the circumstances.

        2. When considering, in accordance with subsection (2), the terms and conditions upon which a receiver can be appointed by a court in relation to a local authority, the court must—

        3. take account of the interests of both the secured and non-secured creditors of the local authority, as against—
          1. the interests of the local authority itself; and
            1. the requirement of the local authority to provide those services that are essential for the maintenance of public health and safety; and
              1. the interests of the ratepayers with property within the area of the local authority; and
                1. the interests of the general public living within the area of the local authority; and
                2. take account of the interests of secured creditors as against the interests of non-secured creditors of the local authority.

                  1. When considering, in accordance with subsection (2), the terms and conditions upon which a receiver can be appointed by a court in relation to Watercare, the court must—

                  2. take account of the interests of both the secured and non-secured creditors of Watercare, as against—
                    1. the interests of Watercare itself; and
                      1. the requirement of Watercare to provide those services that are essential for the maintenance of public health and safety; and
                        1. the interests of consumers with property in Auckland; and
                          1. the interests of the general public living in Auckland; and
                          2. take account of the interests of secured creditors as against the interests of non-secured creditors of Watercare.

                            1. When considering, in accordance with subsection (2), the terms and conditions upon which a receiver can be appointed by a court in relation to a water organisation, the court must—

                            2. take account of the interests of both the secured and non-secured creditors of the water organisation, as against—
                              1. the interests of the water organisation itself; and
                                1. the requirement of the water organisation to provide those services that are essential for the maintenance of public health and safety; and
                                  1. the interests of consumers with property in the service area of the water organisation; and
                                    1. the interests of the general public living within the service area of the water organisation; and
                                    2. take account of the interests of secured creditors as against the interests of non-secured creditors of the water organisation.

                                      1. In this section,—

                                        Auckland has the same meaning as in section 4(1) of the Local Government (Auckland Council) Act 2009

                                          service area has the same meaning as in section 4 of the Local Government (Water Services) Act 2025.

                                          Notes
                                          • Section 40B: replaced, on , by section 117 of the Local Government (Water Services Preliminary Arrangements) Act 2024 (2024 No 31).
                                          • Section 40B(1)(c): inserted, on , by section 64(1) of the Local Government (Water Services) (Repeals and Amendments) Act 2025 (2025 No 43).
                                          • Section 40B(4A): inserted, on , by section 64(2) of the Local Government (Water Services) (Repeals and Amendments) Act 2025 (2025 No 43).
                                          • Section 40B(5): replaced, on , by section 64(3) of the Local Government (Water Services) (Repeals and Amendments) Act 2025 (2025 No 43).