Though in some jurisdictions, the terms supersedeas bond and appeal bond are used interchangeably, other jurisdictions distinguish between the terms. Generally, a supersedeas or appeal bond enables the losing party in a civil litigation case to defer payment of the judgment while an appellate court reviews the case.
Stay of Enforcement
Typically, the winning party in a civil lawsuit is eager to collect the awarded judgment from the losing party, as soon as possible. Attorney, Marc A. Campsen of Wright, Constable & Skeen explains that supersedes and appeal bonds supersedeas and appeal bonds essentially allow the losing party, aka the judgment-debtor, to defer payment:
The word “supersedeas” is Latin for “you shall desist,” and it refers to a stay of the enforcement of a judgment pending appeal. The supersedeas bond suspends a judgment creditor’s power to levy or execute on its judgment….When a judgment-creditor obtains a monetary judgment against a judgment-debtor, most jurisdictions permit the judgment-creditor to immediately upon, or shortly after obtaining the monetary judgment, to commence enforcement proceedings to collect on the judgment, regardless of whether the judgment-debtor intends to appeal the judgment. The judgment-debtor, however, may attempt to stay the enforcement proceedings pending an appeal of the monetary judgment through the use of a supersedeas bond.
In some regions of the country, the nomenclature of supersedeas and appeal bonds is used rather interchangeably, though in others there is a technical difference in the payments the two bonds guarantee will ultimately be paid to the judgment-creditor, if the appeal of the judgment-debtor ultimately fails:
Some jurisdictions refer to the supersedeas bond as an appeal bond, while other jurisdictions distinguish between the two types of bonds. When a jurisdiction recognizes the two different types of bonds, the appeal bond normally ensures the payment of court costs only, while the supersedeas bond guarantees that the judgment-creditor, if successful on the judgment-debtor’s appeal of the monetary judgment, will have a source of recovery and collection after the appeal is concluded in favor of the judgment-creditor. The distinction between the appeal bond and the supersedeas bond, however, is often obscured in some jurisdictions and in case law, which potentially creates confusion.
Good To Know: Preserving The Status Quo
While it’s straightforward to see how a supersedeas or appeal bond protects the judgment-creditor by guaranteeing the availability of funds to make payment if an appeal is lost, it’s useful to know that the bonds also protect the appealing party:
First, the supersedeas bond is necessary to protect the non-appealing party, the judgment-creditor, from the risk that the monetary judgment may be unrecoverable from the judgment-debtor and/or its assets and property upon conclusion of the appellate process. Second, the supersedeas bond is necessary to protect the appealing party, the judgment-debtor, from execution on a monetary judgment by the judgment-creditor prior to the resolution of the appellate process….Essentially, to avoid a scenario where the judgment debtor pays the judgment creditor, then wins on appeal and the judgment creditor can no longer reimburse the money paid by the judgment debtor. In other words, the purpose and effect of posting a supersedeas bond “is to preserve the status quo while protecting the non-appealing party’s rights pending appeal.”
Attorneys further point out that an additional and important public protection that bonds provide during the appeals process, is curtailing frivolous attempts to overturn verdicts issued in civil court cases: “The appeal bond also serves as a safety net bond, which helps protect the court from frivolous appeals or delaying tactics to avoid payment as these dishonest activities cost the court time and money.”
Obtaining Supersedeas or Appeal Bonds?
When a supersedeas or appeal bond is ordered, it’s important to apply for and secure the bond quickly, via a reputable surety company that can meet the case specific “obligee requirements” issued by the court. The bond amount is set by the court, based on the total original judgment, though interest and legal fees may also be factored into the bond amount. Compliance with court specifications and timing is essential. As a leading, direct and national court bond writer, Colonial Surety Company makes it easy and speedy for attorneys in every state to help clients secure supersedeas, appeal and other court bonds. We meet specific court requirements, provide simple online applications, and make instant bond downloads available for filing in court.
Quote and Obtain Supersedeas and Appeal Bonds with a few clicks here now: Colonial Surety Company.
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