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H.B. 85 Enrolled

             1     

MUTUAL BENEFIT CORPORATION -

             2     
JUDICIAL LIENS

             3     
2009 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: Patrick Painter

             6     
Senate Sponsor: David P. Hinkins

             7     
             8      LONG TITLE
             9      General Description:
             10          This bill modifies the Utah Revised Nonprofit Corporations Act and lien provisions to
             11      address the execution of a judicial lien against the water rights and related assets of a
             12      mutual benefit corporation.
             13      Highlighted Provisions:
             14          This bill:
             15          .    defines terms; and
             16          .    imposes limitations on executing a judicial lien.
             17      Monies Appropriated in this Bill:
             18          None
             19      Other Special Clauses:
             20          None
             21      Utah Code Sections Affected:
             22      ENACTS:
             23          16-6a-119, Utah Code Annotated 1953
             24          38-5-2, Utah Code Annotated 1953
             25     
             26      Be it enacted by the Legislature of the state of Utah:
             27          Section 1. Section 16-6a-119 is enacted to read:
             28          16-6a-119. Execution against a mutual benefit corporation.
             29          (1) As used in this section:


             30          (a) "Judicial lien" means one or more of the following:
             31          (i) a judgment lien; or
             32          (ii) other lien obtained by a judicial or equitable process or proceeding.
             33          (b) "Water right" means:
             34          (i) a right to use water evidenced by a means identified in Section 73-1-10 ; or
             35          (ii) a right to use water under an approved application:
             36          (A) to appropriate;
             37          (B) for a change of use; or
             38          (C) for the exchange of water.
             39          (c) "Water rights and related assets" means a water right or title to:
             40          (i) a water conveyance facility; or
             41          (ii) other asset of a mutual benefit corporation necessary to divert or distribute water to
             42      its members.
             43          (2) Except as provided in Subsection (3), a court may not do the following with regard
             44      to a judicial lien recorded on or after May 12, 2009 against the water rights and related assets
             45      of a mutual benefit corporation earlier than 180 days after the day on which the judicial lien is
             46      recorded or takes effect:
             47          (a) execute the judicial lien;
             48          (b) impose a levy as a result of the judicial lien; or
             49          (c) force the sale, transfer, or change in ownership of the water rights and related
             50      assets pursuant to the judicial lien.
             51          (3) This section does not apply to a judicial lien related to a cause of action brought
             52      against a mutual benefit corporation by a shareholder under Section 73-3-3.5 .
             53          Section 2. Section 38-5-2 is enacted to read:
             54          38-5-2. Judicial lien against water rights and related assets of a mutual benefit
             55      corporation.
             56          (1) As used in this section:
             57          (a) "Judicial lien" is defined in Section 16-6a-119 .


             58          (b) "Mutual benefit corporation" is defined in Section 16-6a-102 .
             59          (c) "Water rights and related assets" is defined in Section 16-6a-119 .
             60          (2) A judicial lien recorded on or after May 12, 2009 against the water rights and
             61      related assets of a mutual benefit corporation is subject to Section 16-6a-119 .


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