7-86-115 - Liens Defaults on bonds Receiver. - Tennessee Statutes

7-86-115. Liens Defaults on bonds Receiver.

(a)  There shall be and there is created a statutory lien in the nature of a mortgage lien upon any facility acquired or constructed in accordance with this part, including all extensions and improvements to the facilities or combinations of extensions and improvements to facilities subsequently made, which lien shall be in favor of the holder or holders of any bonds issued pursuant to this part, and all such property shall remain subject to such statutory lien until the payment in full of the principal of and interest on the bonds. Any holder of the bonds or any of the coupons representing interest of the bonds may either at law or in equity, by suit, action, mandamus, or other proceeding, in any court of competent jurisdiction, protect and enforce such statutory lien and compel performance of all duties required by this part, including the making and collection of sufficient rates for the service or services, the proper accounting for the collections, and the performance of any duties required by covenants with the holders of any bond issued in accordance with this section. The statutory lien shall not apply to any property, liens, or equipment owned by the service supplier.

(b)  If any default be made in the payment of the principal of or interest on such bonds, any court having jurisdiction of the action may appoint a receiver to administer the district, and the facility or service, with power to charge and collect rates sufficient to provide for the payment of all bonds and obligations outstanding against the facility or service and for the payment of operating expenses, and to apply the income and revenues of the bonds, in conformity with the provisions of this part, and any covenants with bondholders.

[Acts 1984, ch. 867, § 16.]