Texas § FI.186.204 - CONTEST OF LIQUIDATION

§ FI.186.204. CONTEST OF LIQUIDATION

CONTEST OF LIQUIDATION. (a) A state trust company, acting through a majority of its directors, managers, or managing participants, may intervene in an action filed by the banking commissioner closing a state trust company to challenge the banking commissioner's closing of the state trust company and to enjoin the banking commissioner or other receiver from liquidating its assets. The state trust company must file the intervention not later than the second business day after the closing of the state trust company, excluding legal holidays. The court may issue an ex parte order restraining the receiver from liquidating state trust company assets pending a hearing on the injunction. The receiver shall comply with the restraining order but may petition the court for permission to liquidate an asset as necessary to prevent its loss or diminution pending the outcome of the injunction action. (b) The court shall hear an action under Subsection (a) as quickly as possible and shall give it priority over other business. (c) The state trust company or receiver may appeal the court's judgment as in other civil cases, except that the receiver shall retain all state trust company assets pending a final appellate court order even if the banking commissioner does not prevail in the trial court. If the banking commissioner prevails in the trial court, liquidation of the state trust company may proceed unless the trial court or appellate court orders otherwise. If liquidation is enjoined or stayed pending appeal, the trial court retains jurisdiction to permit liquidation of an asset as necessary to prevent its loss or diminution pending the outcome of the appeal. Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.16(a), eff. Sept. 1, 1999.