North Dakota Code 26.1-15.1-30 – Injunction – Liquidation – Receivership of domestic society
1. The commissioner shall notify the society of the deficiency or deficiencies stating in writing the reasons for the commissioner’s dissatisfaction and requiring that the deficiency or deficiencies be corrected, if the commissioner upon investigation finds that a domestic society has committed any of the following acts:
Terms Used In North Dakota Code 26.1-15.1-30
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- following: when used by way of reference to a chapter or other part of a statute means the next preceding or next following chapter or other part. See North Dakota Code 1-01-49
- Injunction: An order of the court prohibiting (or compelling) the performance of a specific act to prevent irreparable damage or injury.
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See North Dakota Code 1-01-49
- year: means twelve consecutive months. See North Dakota Code 1-01-33
a. Exceeded its powers.
b. Failed to comply with any provision of this chapter. c. Not fulfilled any of its contracts in good faith.
d. Has a membership of less than four hundred after an existence of one year or more.
e. Conducted business fraudulently or in a manner hazardous to its members, creditors, the public, or the business.
After notice the society has a thirty-day period in which to comply with the commissioner’s request for correction. If the society fails to comply, the commissioner shall notify the society of noncompliance and require the society to show cause on a date specified why it should not be enjoined from carrying on any business until the violations complained of have been corrected or why an action in quo warranto should not be commenced against the society.
2. If the society does not present good and sufficient reasons why it should not be so enjoined or why an action in quo warranto should not be commenced, the commissioner may present the facts to the attorney general who may commence an action to enjoin the society from transacting business or in quo warranto.
3. The attorney general shall thereupon notify the officers of the society of a hearing. If after a full hearing it appears that the society should be so enjoined or liquidated or a receiver appointed, the court shall enter the necessary order. No society so enjoined may do business until:
a. The commissioner finds that the violation complained of has been corrected; b. The costs of the action have been paid by the society if the court finds that the society was in default as charged; c. The court has dissolved its injunction; and
d. The commissioner has reinstated the certificate of authority.
4. If the court orders the society liquidated, it must be enjoined from carrying on any further business, whereupon the receiver of the society shall proceed at once to take possession of the books, papers, money, and other assets of the society and, under the direction of the court, proceed forthwith to close the affairs of the society and to distribute its funds to those entitled thereto.
5. No action under this section may be recognized in any court of this state unless brought by the attorney general upon request of the commissioner. Whenever a receiver is to be appointed for a domestic society, the court shall appoint the commissioner or the commissioner’s designee as receiver.
6. The provisions of this section relating to hearing by the commissioner, action by the attorney general at the request of the commissioner, hearing by the court, injunction, and receivership are applicable to a society that voluntarily determines to discontinue business.