§ 21-142 — Charging order

(RULLCA 503) (a) On application by a judgment
creditor of a member or transferee, a court may enter a charging order against
the transferable interest of the judgment debtor for the unsatisfied amount
of the judgment. A charging order constitutes a lien on a judgment debtor's
transferable interest and requires the limited liability company to pay over
to the person to which the charging order was issued any distribution that
would otherwise be paid to the judgment debtor.
(b) To the extent necessary
to effectuate the collection of distributions pursuant to a charging order
in effect under subsection (a) of this section, the court may:
(1) appoint a receiver
of the distributions subject to the charging order, with the power to make
all inquiries the judgment debtor might have made; and
(2) make all other orders
necessary to give effect to the charging order.
(c) Upon a showing that distributions
under a charging order will not pay the judgment debt within a reasonable
time, the court may foreclose the lien and order the sale of the transferable
interest. The purchaser at the foreclosure sale only obtains the transferable
interest, does not thereby become a member, and is subject to section 21-141 .
(d) At any time before
completion of the foreclosure sale under subsection (c) of this section, the
member or transferee whose transferable interest is subject to a charging
order under subsection (a) of this section may extinguish the charging order
by satisfying the judgment and filing a certified copy of the satisfaction
with the court that issued the charging order.
(e) At any time before completion
of the foreclosure sale under subsection (c) of this section, a limited liability
company or one or more members whose transferable interests are not subject
to the charging order may pay to the judgment creditor the full amount due
under the judgment and thereby succeed to the rights of the judgment creditor,
including the charging order.
(f) The Nebraska Uniform Limited Liability Company
Act does not deprive any member or transferee of the benefit of any exemption
laws applicable to the member's or transferee's transferable interest.
(g) This section provides
the exclusive remedy by which a person seeking to enforce a judgment against
a member or transferee may, in the capacity of judgment creditor, satisfy
the judgment from the judgment debtor's transferable interest.

Legislative History

Source: Laws 2010, LB888, § 42.