Define: Supersedeas Bond

A supersedeas bond is a type of surety bond that allows a judgment debtor to delay the enforcement of a judgment while they appeal the decision. It serves as a guarantee that the judgment debtor will pay the judgment amount if the appeal is unsuccessful.

You would need a supersedeas bond if you have been ordered to pay a judgment but wish to delay the enforcement of the judgment while you appeal the decision. It provides you with the opportunity to continue your business operations or personal affairs without the immediate financial burden of the judgment.

The cost of a supersedeas bond varies depending on the judgment amount, the jurisdiction, and the surety company providing the bond. Typically, the premium for a supersedeas bond is a percentage of the judgment amount, usually ranging from 1% to 10%.

In most cases, anyone who has been ordered to pay a judgment and wishes to appeal the decision can obtain a supersedeas bond. However, the surety company providing the bond will assess the applicant’s financial stability, creditworthiness, and other factors to determine their eligibility.

A supersedeas bond remains in effect until the appeal process is concluded. If the appeal is successful, the bond is typically released, and the judgment debtor is no longer required to pay the judgment amount. If the appeal is unsuccessful, the bond will be used to satisfy the judgment.

In some cases, a court may allow the use of collateral, such as cash or property, instead of a supersedeas bond. However, this is at the discretion of the court, and the value of the collateral must be sufficient to cover the judgment amount.

If you fail to obtain a supersedeas bond or provide an alternative form of security as required by the court, the enforcement of the judgment will proceed as usual. This means that you may be required to pay the judgment amount immediately, and the judgment creditor can take steps to collect the debt.

In most cases, a supersedeas bond cannot be canceled by the judgment debtor. It remains in effect until the appeal process is concluded or until the court orders its release. However, the surety company providing the bond may allow for its cancellation under certain circumstances, such as if the judgment is satisfied or if the appeal is withdrawn.

If the judgment amount increases during the appeal process, you may be required to increase the amount of your supersedeas bond to cover the additional judgment. Failure to do so may result in the enforcement of the judgment for the increased amount.

A supersedeas bond is typically used for monetary judgments, where the judgment debtor is ordered to pay a specific amount of money. It may not be applicable for other types of judgments, such as injunctions or specific performance orders, where the enforcement is not based on monetary payment.