25 Del. C. ch. 59 § 5906
Powers and duties of the receiver
Operative Text
The receiver shall have all the powers and duties accorded a receiver foreclosing a mortgage on real property and all other powers and duties deemed necessary by the Court. Such powers and duties shall include, but are not necessarily limited to, collecting and using all rents and profits of the property, prior to and despite any assignment of rent, for the purposes of: (1) Correcting the condition or conditions alleged in the petition; (2) Materially complying with all applicable provisions of any state or local statute, code, regulation or ordinance governing the maintenance, construction, use or appearance of the building and surrounding grounds; (3) Paying all expenses reasonably necessary to the proper operation and management of the property including insurance, mortgage payments, taxes and assessments and fees for the services of the receiver and any agent the receiver should hire; (4) Compensating the tenants for whatever deprivation of their rental agreement rights resulted from the condition or conditions alleged in the petition; and (5) Paying the costs of the receivership proceeding.
Under 25 Del. C. ch. 59 § 5906, when a court appoints a receiver over a residential property, that receiver steps into a broad management role with authority comparable to a mortgage foreclosure receiver. The receiver is empowered to collect all rents and profits from the property—even overriding any prior rent assignment—and must direct those funds toward fixing the conditions that triggered the receivership, bringing the property into compliance with applicable codes, covering operating expenses, compensating tenants for harms suffered, and paying the costs of the proceeding itself. The court retains authority to expand the receiver's powers as circumstances require.
Plain English — not legal advice.
Property owners and managers operating in Delaware should understand that 25 Del. C. ch. 59 § 5906 authorizes a court to strip control of a building's rental income from an owner and vest it in a court-appointed receiver when serious habitability or code-compliance conditions go unaddressed. A compliant operator generally maintains the property in a condition that satisfies applicable state and local codes, responds promptly to documented deficiencies, and keeps insurance, mortgage, tax, and management obligations current—all of which reduce the circumstances under which a receivership petition could succeed. Once a receiver is appointed under this section, the owner loses direct control over rents and operational decisions until the court determines the receivership's purpose has been fulfilled.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
For tenants living in a property subject to a receivership proceeding under 25 Del. C. ch. 59 § 5906, this provision explicitly includes compensation for deprivations of rental-agreement rights caused by the conditions alleged in the petition as one of the authorized uses of collected rents. Tenants may have standing to participate in the receivership proceeding and can document the conditions and resulting harms they experienced to support a compensation claim. Tenant-rights organizations and legal aid services familiar with Delaware housing law can help tenants understand how to engage with the receivership process and what documentation may be relevant.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated October 22, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
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