Getting order right critical for Court Appointed Hotel Receiver

One of the critical issues – if not the most important – in addition to proposing a Court Appointed Hotel Receiver for a particular hotel receivership is making sure the initial “order” moving to appoint the hotel receiver is sufficiently detailed, broad enough and specific to the uniqueness of a hotel and its operating business. In particular are the many bank accounts and where these deposits flow from within the hotel receivership. It is especially important, and will save a hotel receiver any associated costs of going back to the judge later, to be certain to specify the nature of all cash accounts, receipts and related income that the Court Appointed Hotel Receiver will take control of as part of the hotel receivership.Hotel Receivership Meeting For example, the order should not only spell cash deposits and the various types of credit cards, but other forms of revenues and income. In hotel receiverships, these may include accounts receivables and corporate billings, set asides for fixtures, furnishings and equipment (FF&E) required by the brand or franchise, commissions deducted by the franchisor or OTAs (online travel agents), along with any trade script (i.e. advertising exchanges) and barter agreements for suppliers and outside services. It is also customary that any set asides for FF&E, along with the employee payroll, are typically deposited in and held in separate bank accounts for accounting control purposes. These accounts if known should be referenced in the order, along with any owner and investor accounts where the hotel property management company may deposit a portion of the gross revenues as payback for a prior owner loan or investors return on investment. Lastly, the order should clearly specify that the Court Appointed Hotel Receiver will be the sole signatory for all related bank accounts and will not share this responsibility with any third party as part of the hotel receivership.