2023 Florida Statutes › Title XXIX - Public Health › Chapter 394 - Mental Health › Part IV - Community Substance Abuse and Mental Health Services (Ss. 394.65-394.9087) › 394.903 - Receivership proceedings.

394.903 Receivership proceedings.—
(1) The agency, independently or in conjunction with the department may petition a court of competent jurisdiction for the appointment of a receiver for a crisis stabilization unit or a residential treatment facility when any of the following conditions exist:
(a) Any person is operating a unit or facility without a license and refuses to make application for a license as required by this part.
(b) The licensee is closing the unit or facility or has informed the agency that it intends to close and adequate arrangements have not been made for relocation of the residents within 7 days, exclusive of weekends and holidays, of the closing of the unit or facility.
(c) The agency determines that conditions exist in the unit or facility which present an imminent danger to the health, safety, or welfare of the residents of the unit or facility or a substantial probability that death or serious physical harm would result therefrom. The agency shall, whenever possible, facilitate the continued operation of the program.
(d) The licensee cannot meet its financial obligations for providing food, shelter, care, and utilities. Issuance of bad checks or accumulation of delinquent bills for such items as personnel salaries, food, drugs, or utilities constitutes prima facie evidence that the ownership of the unit or facility lacks the financial ability to operate the unit or facility in accordance with the requirements of this chapter and all rules adopted under this chapter.
(2) Petitions for receivership shall take precedence over other court business unless the court determines that some other pending proceeding, having similar statutory precedence, shall have priority. A hearing shall be conducted within 5 days after the filing of the petition, at which time all interested parties shall have the opportunity to present evidence pertaining to the petition. The agency shall notify the owner or operator of the unit or facility named in the petition of its filing and the dates for the hearing. The court shall grant the petition only upon finding that the health, safety, and welfare of residents of the unit or facility would be threatened if a condition existing at the time the petition was filed is permitted to continue. A receiver shall not be appointed ex parte unless the court determines that one or more of the conditions of subsection (1) exist and that the owner or operator cannot be found, that all reasonable means of locating the owner or operator and notifying him or her of the petition and hearing have been exhausted, or that the owner or operator after notification of the hearing chooses not to attend. After such findings, the court may appoint any person qualified by education, training, or experience to carry out the responsibilities of receiver pursuant to this section, except that it shall not appoint any owner or affiliate of the unit or facility which is in receivership. Prior to the appointment as receiver of a person who is the operator, manager, or supervisor of another unit or facility, the court shall determine that the person can reasonably operate, manage, or supervise more than one unit or facility. The receiver may be appointed for up to 90 days, with the option of petitioning the court for 30-day extensions. The receiver may be selected from a list of persons qualified to act as receivers developed by the agency and presented to the court with each petition for receivership. The agency or department or a designated employee of either, may not be appointed as a receiver for more than 60 days; however, such receiver may petition the court for 30-day extensions. The agency may petition the court to appoint a substitute receiver. The court shall grant the extension upon a showing of good cause. During the first 60 days of the receivership, the agency may not take action to decertify or revoke the license of a unit or facility unless conditions causing imminent danger to the health and welfare of the residents exist and a receiver has been unable to remove those conditions. After the first 60 days of receivership, and every 60 days thereafter until the receivership is terminated, the agency shall submit to the court the results of an assessment of the unit’s or facility’s ability to assure the safety and care of the residents. If the conditions at the unit or facility or the intentions of the owner indicate that the purpose of the receivership is to close the unit or facility rather than to facilitate its continued operations, the department, in consultation with the agency, shall place the residents in appropriate alternative residential settings as quickly as possible. If, in the opinion of the court, the agency has not been diligent in its efforts to make adequate placement arrangements, the court may find the agency to be in contempt and shall order the agency to submit its plans for moving the residents.
(3) The receiver shall make provisions for the continued health, safety, and welfare of all residents of the unit or facility and:
(a) Shall exercise those powers and perform those duties set out by the court.
(b) Shall operate the unit or facility in such a manner as to assure safety and adequate health care for the residents.
(c) Shall take such action as is reasonably necessary to protect or conserve the assets or property of the unit or facility for which the receiver is appointed, or the proceeds from any transfer thereof, and he or she may use them only in the performance of the powers and duties set forth in this section or by order of the court.
(d) May use the buildings, fixtures, furnishings, and any accompanying consumable goods in the provision of care and services to residents and to any other persons receiving services from the unit or facility at the time the petition for receivership is filed. The receiver shall collect payments for all goods and services provided to residents or others during the period of the receivership at the same rate of payment charged by the owners at the time the petition for receivership was filed or at a fair and reasonable rate otherwise approved by the court for private-pay residents.
(e) May correct or eliminate any deficiency in the structure, furnishings, or staffing of the unit or facility which endangers the safety or health of residents while they remain in the unit or facility; however, the total cost of correction shall not exceed $3,000. The court may order expenditures for this purpose in excess of $3,000 on application from the receiver after notice to the owner. A hearing may be requested by the owner within 72 hours.
(f) May let contracts and hire agents and employees to carry out the powers and duties of the receiver under this section.
(g) Shall honor all leases, mortgages, and secured transactions governing the building in which the unit or facility is located and all goods and fixtures in the building of which the receiver has taken possession, but only to the extent of payments which, in the case of rental agreement, are for the use of the property during the period of the receivership or which, in the case of a purchase agreement, become due during the period of the receivership.
(h) Shall have full power to direct, manage, hire, and discharge employees of the unit or facility subject to any contract rights they may have. The receiver shall hire and pay employees at the rate of compensation, including benefits, approved by the court. Receivership does not relieve the owner of any obligation to employees made prior to the appointment of a receiver and not carried out by the receiver.
(i) Shall be entitled to take possession of all property or assets of residents which are in the possession of a unit or facility or its owner. The receiver shall preserve all property or assets and all resident records of which the receiver takes possession and shall provide for the prompt transfer of the property, assets, and records to the new placement of any transferred resident. An inventory list certified by the owner and by the receiver shall be made at the time the receiver takes possession of the facility.
(4)(a) A person who is served with notice of an order of the court appointing a receiver and of the receiver’s name and address shall be liable to pay the receiver for any goods or services provided by the receiver after the date of the order if the person would have been liable for the goods or services as supplied by the owner. The receiver shall give a receipt for each payment and shall keep a copy of each receipt on file. The receiver shall deposit accounts received in a separate account and shall use this account for all disbursements.
(b) The receiver may bring an action to enforce the liability created by paragraph (a).
(c) A payment to the receiver of any sum owing to the facility or its owner shall discharge any obligation to the facility to the extent of the payment.
(5)(a) A receiver may petition the court that he or she not be required to honor any lease, mortgage, secured transaction, or other wholly or partially executory contract entered into by the owner of the facility if the rent, price, or rate of interest required to be paid under the agreement was substantially in excess of a reasonable rent, price, or rate of interest at the time the contract was entered into, or if any material provision of the agreement was unreasonable, when compared to contracts negotiated under similar conditions. Any relief in this form provided by the court shall be limited to the life of the receivership, unless otherwise determined by the court.
(b) If the receiver is in possession of real estate or goods subject to a lease, mortgage, or security interest which the receiver has obtained a court order to avoid under paragraph (a), and if the real estate or goods are necessary for the continued operation of the unit or facility under this section, the receiver may apply to the court to set a reasonable rental, price, or rate of interest to be paid by the receiver during the duration of the receivership. The court shall hold a hearing on the application within 15 days. The receiver shall send notice of the application to any known persons who own the property involved or to mortgage holders at least 10 days prior to the hearing. Payment by the receiver of the amount determined by the court to be reasonable is a defense to any action against the receiver for payment or for possession of the goods or real estate subject to the lease, security interest, or mortgage involved by any person who received such notice, but the payment does not relieve the owner of the facility of any liability for the difference between the amount paid by the receiver and the amount due under the original lease, security interest, or mortgage involved.
(6) The court shall set the compensation of the receiver, which shall be considered a necessary expense of a receivership.
(7) A receiver may be held liable in a personal capacity only for the receiver’s own gross negligence, intentional acts, or breaches of fiduciary duty.
(8) The court may require a receiver to post a bond.
(9) The court may terminate a receivership when:
(a) The court determines that the receivership is no longer necessary because the conditions which gave rise to the receivership no longer exist; or
(b) All of the residents in the unit or facility have been transferred or discharged.
(10) Within 30 days after termination, unless this time period is extended by the court, the receiver shall give the court a complete accounting of all property of which the receiver has taken possession, of all funds collected and disbursed, and of the expenses of the receivership.
(11) Nothing in this section shall be construed to relieve any owner, operator, or employee of a unit or facility placed in receivership of any civil or criminal liability incurred, or any duty imposed by law, by reason of acts or omissions of the owner, operator, or employee prior to the appointment of a receiver; nor shall anything contained in this section be construed to suspend during the receivership any obligation of the owner, operator, or employee for payment of taxes or other operating and maintenance expenses of the unit or facility or of the owner, operator, or employee or any other person for the payment of mortgages or liens. The owner shall retain the right to sell or mortgage any unit or facility under receivership, subject to approval of the court which ordered the receivership. Receivership imposed under the provisions of this chapter shall be subject to the Health Care Trust Fund pursuant to s. 408.16. The owner of a facility placed in receivership by the court shall be liable for all expenses and costs incurred by the Health Care Trust Fund which occur as a result of the receivership.
History.—ss. 9, 11, ch. 85-167; s. 4, ch. 91-429; s. 723, ch. 95-148; s. 34, ch. 98-171; s. 9, ch. 2008-9.