Illinois Enacts Comprehensive Receivership Reform—Dykema Among First Appointed Under the New Act

Takeaways

• Courts now have expanded authority to appoint receivers both pre- and post-judgment in a broader range of disputes.
• Receivers are granted enhanced operational powers, including asset sales, business management, and claims administration.
• The Act offers a streamlined, court-supervised alternative to bankruptcy for distressed businesses and real estate.

---

Effective January 1, 2026, Illinois implemented an important reform to its receivership framework with the enactment of the Illinois Receivership Act. The legislation modernizes and consolidates prior patchwork statutes into a comprehensive, uniform structure governing commercial receiverships statewide. The Act significantly expands the circumstances under which a receiver may be appointed and clarifies the powers available once appointed, creating a more predictable and efficient alternative to bankruptcy for distressed businesses, commercial real estate, and complex asset disputes.

The new statute provides courts with clearer authority to appoint receivers pre- or post-judgment and grants receivers expanded operational powers, including managing businesses, selling assets under court supervision, retaining professionals, and administering claims processes. In many respects, the Act functions as a streamlined, court-supervised restructuring tool—offering stakeholders the protections of a structured proceeding without the time and expense of a bankruptcy filing.

Dykema is already at the forefront of implementation. The firm is among the first to successfully seek an appointment of a receiver for a distressed business, ensuring that the lender’s collateral is protected and preserved during pending litigation.

With decades of experience in commercial litigation and insolvency, Dykema is uniquely positioned to guide clients through the strategic use of receiverships under the new statute. Whether seeking to protect collateral, preserve enterprise value, or enforce its default remedies, our team combines courtroom credibility with practical business judgment to deliver efficient, outcome-focused solutions.

As Illinois courts begin applying this new framework, Dykema remains at the forefront—helping shape best practices and delivering results in some of the first proceedings brought under the Act.