Court-appointed decision-makers short of a receiver.
Esshaki Legal Media TeamCurrent as of September 2025
Where a company is deadlocked or mismanaged, courts can appoint someone to act
without displacing management entirely.
Provisional director. An additional director appointed by the court with
full voting rights, serving until the deadlock resolves or the court orders
otherwise. Compensation set by the court and paid by the company. The
appointment breaks ties without disturbing the ordinary management structure,
and it is the least intrusive of the available remedies.
Custodian. Appointed to manage the business and affairs, with the powers the
order specifies, generally continuing the business rather than liquidating it.
Statutes commonly provide for appointment on deadlock or on grounds that would
support dissolution.
Receiver. More intrusive, displacing management, and generally directed at
preservation and, where ordered, liquidation.
Selection. Independent, with relevant industry or governance experience.
Parties should propose candidates rather than leaving the choice to the court.
Scope of the order. What decisions require the appointee’s participation,
reporting obligations, access to records and personnel, compensation, and the
duration or the conditions for termination.
Practical effect. The prospect of a stranger casting the deciding vote is
frequently what produces a negotiated resolution, which is the point.