Iowa Department of Human Services v. Community Care, Inc.

MANSFIELD, Justice.

This case presents the question whether Iowa Code sections 249A.44(3) and 680.7 authorize the payment of a receiver’s expenses out of property in which a secured creditor had a prior perfected security interest. Guided in part by the principle that we avoid interpreting ambiguous statutes in a manner that leads to constitutional difficulties, we hold these sections do not authorize a receiver to be paid out of assets that are subject to a prior perfected lien. Rather, we conclude Iowa follows the common law rule that receivership expenses may be chargéd to secured property…