If there be any default in the payment of the principal or interest of any bonds issued pursuant to this chapter, or in any other condition thereof materially affecting the rights of any bondholder, and such default shall continue for a period of not less than three months, or if said utility affected by said bonds or subject to the payment thereof be mismanaged by the municipal authorities in charge thereof, or if the revenues from such utility be dissipated, wasted, or be diverted from their proper application to the payment of said bonds and to the operation, maintenance, and upkeep of said utility, then any court having jurisdiction of the action, in a proper suit commenced by either a resident taxpayer of said municipality whose rights may have been or may be affected, injured, or lost thereby, or commenced by any bondholder similarly affected by any such default, may appoint a receiver to operate and administer such utility subject to the payment thereof or subject to the lien declared in § 9-40-25, with power on the part of such receiver to charge and collect rates reasonably sufficient to provide for the payment of any bonds or obligations subsisting against such utility, and for the payment of the maintenance and operating expenses, including the expenses of administration, and to apply the net income and revenue in conformity with this chapter and the ordinance referred to therein.

Source: SL 1931, ch 194, § 8; SDC 1939, § 45.2408.