Surety Bond Quarterly - Winter 2015 - (Page 20)

feature unravelling the of mystery COURT BONdS BY JEFFREY M. FRANK BY oMAR J. HARB FOR PARTIES ENGAGEd in litigation, court bonds are often a useful tool. Because there is such a variety of these bonds, it is often difficult to know the proper name and purpose of each of them. This article will provide a brief explanation of the primary types of court bonds that are available, along with a few useful tips for producers and underwriters. Appeal and supersedeas bonds The most common types of court bonds are appeal bonds and supersedeas bonds. There is often confusion between these two types of bonds, the terms of which are improperly used interchangeably. Appeal bonds An appeal bond covers the opposing party's court costs if the appeal is unsuccessful. Any party can bring an appeal after a final judgment in civil litigation. The specific 20 BY JESSICA L. WYNN rules regarding the appeal and the costs covered vary from jurisdiction to jurisdiction and from state court to federal court. The court will determine the penal sum of the appeal bond. Because damages are usually limited to court costs, such as filing fees, transcripts, etc., attorneys' fees are generally not covered unless the appeal involves a specific statute providing for fees. The producer should gain a working understanding of the law in his or her jurisdiction and advise the surety to ascertain the relevant law and to seek proper guidance when underwriting the account. Supersedeas Bonds The supersedeas bond guarantees the successful trial court litigant that it will have a source of collection after the appeal. When a party prevails in the trial court surety BoNd Quarterly | WINTER 2015 and obtains a judgment against its opponent, the opponent may want to appeal that decision. In addition, the judgment debtor does not want the plaintiff to collect on the judgment while the appeal is pending. In order to put the collection efforts on hold, the judgment debtor appealing the decision (appellant) must obtain a stay of enforcement. To obtain the stay, the appellant will have to file a motion with the court and then post the bond. If the court grants the stay, the court will determine the amount of the bond. The amount of the bond is usually around 125 percent of the judgment amount to account for costs, interest, and other damages that might arise during the course of the appeal. Because the appellant has already lost in the trial court, the surety is taking on a substantial

Table of Contents for the Digital Edition of Surety Bond Quarterly - Winter 2015

NASBP Upcoming Meetings & Events
2015-2016 Executive Committee
From the CEO - Never Forget Your Latin: Ignorantia Juris Non Excusat
Practical Insights: What You Need to Know - Unlicensed Contractors A Threat to Their Sureties
Hot Topics in Federal Government Contract Compliance
Fraud Schemes and Related Controls in the Construction Industry
Unravelling the Mystery of Court Bonds
NASBP Attorney Advisory Council Participates in NASBP Regional Meetings
Public-Private Partnership Projects
Mining the Value of the NASBP Member Network
Applied Education
Index to Advertisers

Surety Bond Quarterly - Winter 2015