Supersedeas | Appeal Bonds

A variety of individuals and entities might have to post a supersedeas bonds in relation with appealing a court decision to a higher authority. The appeal cannot be made before they fulfill this requirement. Both federal and state courts can require the posting of an appeal bond.

This prevents misuse of the appellate system and reduces the burden from fake or manipulative appeals. In case the appeal does not succeed, the appellant is thus guaranteed to pay the financial costs of the first court ruling.

There’s only one kind of supersedeas bond, so you don’t need to worry about choosing the right kind when obtaining it.

The cost of an appeal bond is set on the basis of individual circumstances when a plaintiff brings a specific case to an appellate court.

Unlike the cost of other surety bonds, the supersedeas bond cost does not depend on the personal credit score of the bond applicant. Because it’s difficult to predict the decisions in court cases, appeal bonds are seen as high-risk. That’s why appellants have to pay at least 100% collateral, which is the initial judgment amount. Other costs and interest can increase this percentage as well.

The purpose of requiring a full collateral, is to discourage abuse of the appeals court system. If litigants just want to extend a judgment or avoid covering financial costs, the high price of making an appeal would persuade them against such a course of action. The collateral is also used to reimburse the court, without financial loss for the surety backing the plaintiff.

Besides the collateral, the plaintiff needs to pay a bond premium, a percentage of the surety bond amount. This amount depends on the specific court case and is usually equal to the financial costs set in the initial court judgment.

Because of the particularity of supersedeas bonds, there are no special bonding markets for them. Getting an appeal bond is possible only with good finances, so there are no bad credit bonding options. In general, obtaining supersedeas bonds is more difficult and requires a higher financial responsibility on the side of the bond principal.

As supersedeas bonds are high-risk surety bonds, the minimum requirement for 100% collateral is in force. Appeal bond applicants should thus prepare to cover these costs to get bonded.

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A claim can be made against your supersedeas bond if you do not cover the costs on the initial court judgment, which has remained after the appeal that you brought. The collateral that you provided when getting bonded can be used to fulfill your financial responsibility to the court.

The costs on proven claims always remain the liability of the bonded party. Thus, when you obtain an appeal bond, it does not protect you, but rather guarantees you will abide by the decision of the court.