Short answer. Yes. The application may be denied, or an already-appointed receiver discharged, if you file a bond to the applicant, in a court-fixed amount, promising to pay all damages the applicant may suffer from the acts or matters cited as grounds for the appointment. A receiver can also be discharged if shown to have been appointed without sufficient cause.
What the law says
The application may be denied, or the receiver discharged, when the adverse party files a bond executed to the applicant, in an amount to be fixed by the court, to the effect that such party will pay the applicant all damages he may suffer by reason of the acts, omissions, or other matters specified in the application as ground for such appointment. The receiver may also be discharged if it is shown that his appointment was obtained without sufficient cause.
Rule 59, Section 3 — Denial of application or discharge of receiver. Read the full provision →
A counter-bond as a defense to receivership
Rule 59, Section 3 gives the party opposing a receivership application a concrete way to defeat it: posting a bond to the applicant, in an amount the court fixes, promising to pay the applicant all damages that might arise from the very acts, omissions, or other matters the application cited as grounds for the receiver's appointment. In effect, the counter-bond offers the applicant an alternative form of security: instead of having a court-appointed receiver take over and preserve the property directly, the applicant is given a financial guarantee that covers the same risk the receivership was meant to address, letting the property stay in the adverse party's hands while still protecting the applicant's interest.
This works both before and after appointment
The section covers two distinct scenarios: the application may be denied outright if the bond is filed before a receiver is appointed, or an already-appointed receiver may be discharged if the bond is filed afterward. Either way, the effect is the same — the counter-bond substitutes for the receivership as the security mechanism protecting the applicant's interests. This matters practically because a party does not lose the chance to post a counter-bond just because a receiver has already been put in place; the remedy remains available at whatever point the adverse party is ready to offer the security, whether that is at the outset of the case or only after the receivership is already underway.
A separate ground: no sufficient cause for the appointment
The section also allows discharge of the receiver on an entirely different basis — a showing that the appointment was obtained without sufficient cause in the first place. This does not require posting any bond at all; it directly challenges whether the receivership should have been granted on its merits. A party relying on this ground is not offering a substitute for the receivership the way a counter-bond does; instead, they are arguing the receivership should never have existed, which, if successful, removes the receiver without the adverse party having to put up any money or security whatsoever.
Related provisions
- Rule 59, Section 3 — Denial of application or discharge of receiver
- Rule 59, Section 2 — Bond on appointment of receiver
- Rule 59, Section 5 — Service of copies of bonds; effect of disapproval of same