A person in possession of the debtor’s property, usually a receiver appointed by a state court before the debtor’s bankruptcy case was filed.
The Code requires a custodian to turn over the debtor’s property to the debtor upon the debtor’s bankruptcy filing. But the bankruptcy court may leave the custodian in possession if it determines that doing so would serve the best interests of creditors.
When bankruptcy is imminent, the secured creditor often races to the courthouse to obtain the appointment of a receiver, hoping that the court will continue the receiver in possession post-bankruptcy.
Bankruptcy Code §§ 101(11), 543. See also Property of the Estate, Turnover.