Arkansas Puts "Care and Preservation of the Property" in the Assignee's First Duty

Across this segment the statutes tend to treat the buildings as an afterthought - something that happens between the assignment and the auction. Arkansas is the exception. Its assignment chapter opens by making possession and preservation the assignee's first duty, before the inventory is filed and before any bond exists. For anyone who secures commercial property, that single sentence changes when the work starts and who has authority to order it.

Possession First, and Preservation Named in the Duty

A.C.A. § 16-117-401(a): "In all cases in which any person makes an assignment of his or her property for the benefit of his or her creditors, it shall be the duty of the assignee named in the deed of assignment to take immediate possession of the property for the purpose of making an inventory and description of the property and for the care and preservation of the property."

Three things are doing work there. It is a duty, not a power - the assignee is obliged, not merely permitted. Possession is to be immediate. And the purpose is stated twice over: to inventory and describe the property, and "for the care and preservation of the property."

Set that beside the others in this series and the difference is stark. Texas conditions possession on a bond filed within five days. Oklahoma withholds all authority until four separate steps are complete. Ohio makes the assignment effective only on delivery to the probate judge. Arkansas sends the assignee to the property on day one and tells them to look after it.

The section carries Acts 1895, No. 109, § 1, through the digests to A.S.A. 1947, § 36-301, with an amendment by Acts 2003, No. 1185, § 239.

Ten Days, and a Bond at Double the Value

Subsection (b) sets the filing: "Within ten (10) days after taking possession of the property, the assignee shall file with the clerk of the circuit court a full, true, and complete inventory and description of the property together with his or her bond in double the amount of the supposed value of the property with good security, to be approved by the clerk of the circuit court, which bond shall be conditioned that the assignee shall faithfully execute the trust confided to him or her under the provisions of the deed of assignment, and the order of the circuit court."

Two details are worth noting. The ten days run from taking possession, not from the date of the assignment - so the clock the assignee controls is when they go to the site. And the bond amount is formulaic rather than discretionary: double the supposed value of the property. Texas has the judge fix the amount, Ohio leaves it to such sum as the court approves, and Oklahoma has the district judge name it. Arkansas writes the multiplier into the statute, which makes the inventory valuation the number that sets the bond.

The Bond Gates Sale, Not Possession

Because possession comes first, the bond has to gate something else, and § 16-117-404(b) says what: "Nothing in this section and §§ 16-117-401, 16-117-402, and 16-117-405 shall be construed as to authorize the assignee to sell or dispose of the property until he or she has executed his or her bond in accordance with the provisions of § 16-117-401."

That is the same place Ohio puts its gate - R.C. 1313.01 bars disposal, not possession, until the bond is filed - and the opposite of Texas, where § 23.16(d) makes possession itself wait. The practical effect in Arkansas is that protective work is squarely within the assignee's authority from the first day, while anything that looks like disposal is not.

Sale itself is then controlled by the deed and the court. Under § 16-117-404(a), where a sale or disposition of the property or any portion of it is "not provided for in the deed of assignment," any person interested in the execution of the assignment may petition the circuit court setting forth the necessity, and the court "shall make such order in relation thereto as may seem just and for the best interest of the estate, setting forth the time and terms of the sale." The order is endorsed on the petition and filed with the clerk.

Six Months, and What Happens If It Falls

Section 16-117-402(a) gives a short challenge window: proceedings contesting the validity of the assignment "shall be instituted within six (6) months from the date of the assignment, by filing complaint in the circuit court of the proper county, setting forth the grounds upon which the assignment is contested." Subsection (b) allows any creditor or person interested in the execution of the assignment to be made a party, plaintiff or defendant.

If the challenge succeeds, the structure does not disappear - it converts. Subsection (c): the assignment "shall then be considered and treated as a general assignment of all his or her property, not exempt from execution, for the benefit of all his or her creditors pro rata," with the property disposed of and distributed under the orders and direction of the circuit court. And the assignee "shall become subject to the control and direction of the circuit court in the same manner as if he or she had been appointed a receiver to take charge of the fund."

That continuity matters operationally. In Arkansas a successful challenge does not leave the site without anyone responsible for it; the same person carries on, under the court instead of under the deed.

Fraud is handled separately and harshly. Section 16-117-403, which comes from Acts 1887, No. 101: any assignment for the benefit of creditors "may be contested or attacked for fraud by any creditors. Proof of fraud on the part of the assignor shall be sufficient to invalidate the assignment, whether the assignee knew of it or not." The assignee's innocence is no answer - a point Oklahoma addresses the other way by protecting an assignee who acted in good faith even where the assignment is afterwards adjudged void.

What the Chapter Pays For, and What It Does Not

Subchapter 4 runs from § 16-117-401 to § 16-117-405, and only one of those sections deals with paying anybody. Section 16-117-405 covers counsel: where any portion of the property becomes involved in litigation, that fact when made known to the circuit court "shall authorize the circuit court to direct the assignee to employ counsel either to prosecute or defend in the litigation," and the court "shall stipulate in the order the percentage to be allowed the attorney as the fee for his or her services, which is to be paid out of the estate."

There is no counterpart for the assignee's own compensation, and none for a contractor's costs. Arkansas has nothing like Ohio's bill of items and affidavit under R.C. 1313.51, or Texas's court-fixed "necessary expenses" under § 23.21. What it has instead is a statutory duty of care and preservation and a circuit court supervising the trust.

The sensible reading for a vendor is that the authority to instruct the work is clear from day one and the route to payment is not written down - which makes the engagement terms with the assignee, and the assignee's own line of accountability to the circuit court, the things to settle before mobilising rather than after.

What This Means If You Do the Work

• The assignee is obliged to take immediate possession and to care for and preserve the property - protective work is within authority from day one
• The ten-day clock for the inventory and bond runs from when possession is taken, not from the date of the assignment
• The bond is double the supposed value of the property, so the inventory valuation drives it; expect the assignee to want an accurate condition and value picture fast
• The bond gates sale and disposal, not possession - the same place Ohio puts it, and the opposite of Texas
• A sale not provided for in the deed of assignment needs a circuit court order fixing the time and terms
• The validity of the assignment can be contested for six months, and a successful challenge converts it to a general assignment with the same assignee answering to the court as a receiver would
• Only counsel fees are provided for out of the estate under § 16-117-405 - settle the payment route for field work in the engagement, because the chapter does not set one

For the other statutes in the footprint, see Texas, where the bond gates possession and the assignee must reside in the debtor's county, Ohio, where the probate court runs it and expenses need a bill of items, Oklahoma, where an unrecorded assignment is void against creditors after twenty days, and Alabama, which adopted the Uniform Assignment for Benefit of Creditors Act on 1 October 2026. Arkansas's other regimes over a building someone else owns are separate: there is no blighted-property receivership and a city's clean-up lien takes priority only by court order, a chapter 7 homestead capped at $2,500 but never below a quarter acre, and a tax deed with ninety days to contest and an 1883 betterment statute behind it. For commercial scope see commercial property maintenance and our Arkansas page.