§ 32-10.1-16 — Executory contract

North Dakota § 32-10.1-16

• Jurisdiction: North Dakota
• Title 32: Judicial Remedies
• Ch. 32-10.1: Uniform Commercial Real Estate Receivership Act

Text

1. As used in this section, "timeshare interest" means an interest having a duration of
more than three years which grants its holder the right to use and occupy an

accommodation, facility, or recreational site, whether improved or not, for a specific
period less than a full year during any given year.
2. Except as otherwise provided in subsection 8, with court approval, a receiver may
adopt or reject an executory contract of the owner relating to receivership property.
The court may condition the receiver's adoption and continued performance of the
contract on terms appropriate under the circumstances. If the receiver does not
request court approval to adopt or reject the contract within a reasonable time after the
receiver's appointment, the receiver is deemed to have rejected the contract.
3. A receiver's performance of an executory contract before court approval under
subsection 2 of its adoption or rejection is not an adoption of the contract and does not
preclude the receiver from seeking approval to reject the contract.
4. A provision in an executory contract which requires or permits a forfeiture,
modification, or termination of the contract because of the appointment of a receiver or
the financial condition of the owner does not affect a receiver's power under
subsection 2 to adopt the contract.
5. A receiver's right to possess or use receivership property pursuant to an executory
contract terminates on rejection of the contract under subsection 2. Rejection is a
breach of the contract effective immediately before appointment of the receiver. A
claim for damages for rejection of the contract must be submitted by the later of:
a. The time set for submitting a claim in the receivership; or
b. Thirty days after the court approves the rejection.
6. If at the time a receiver is appointed, the owner has the right to assign an executory
contract relating to receivership property under any other provision of law, the receiver
may assign the contract with court approval.
7. If a receiver rejects under subsection 2 an executory contract for the sale of
receivership property that is real property in possession of the purchaser or a
real-property timeshare interest, the purchaser may:
a. Treat the rejection as a termination of the contract, and in that case the purchaser
has a lien on the property for the recovery of any part of the purchase price the
purchaser paid; or
b. Retain the purchaser's right to possession under the contract, and in that case
the purchaser shall continue to perform all obligations arising under the contract
and may offset any damages caused by nonperformance of an obligation of the
owner after the date of the rejection, but the purchaser has no right or claim
against other receivership property or the receiver on account of the damages.
8. A receiver may not reject an unexpired lease of real property under which the owner is
the landlord if:
a. The tenant occupies the leased premises as the tenant's primary residence;
b. The receiver was appointed at the request of a person other than a mortgagee; or
c. The receiver was appointed at the request of a mortgagee and:
(1) The lease is superior to the lien of the mortgage;
(2) The tenant has an enforceable agreement with the mortgagee or the holder
of a senior lien under which the tenant's occupancy will not be disturbed as
long as the tenant performs its obligations under the lease;
(3) The mortgagee has consented to the lease, either in a signed record or by
its failure timely to object that the lease violated the mortgage; or
(4) The terms of the lease were commercially reasonable at the time the lease
was agreed to and the tenant did not know or have reason to know the
lease violated the mortgage.