Colorado Supersedeas Bonds
What is a Colorado Supersedeas Bond?
In Colorado, a judgment debtor may post a supersedeas bond at or after the time of filing a notice of appeal, per C.R.C.P. 62(d).
By posting the bond with the trial court, the appellant pauses any collection efforts while preserving their right to pursue the appeal. If the judgment is affirmed on appeal, the judgment creditor may file a claim on the bond against the surety insurer to recover the amount owed should the judgment debtor fail to satisfy the judgment.
Colorado Supersedeas Bond Amount Requirements
According to the Colorado Rules of Civil Procedure – C.R.C.P. 121, Section 1-23, to stay enforcement of a money judgment the amount of a supersedeas bond shall be 125% of the total amount of the judgment entered by the court (including any prejudgment interest, costs and attorneys fees awarded by the court).
Colorado Revised Statutes Title 13-16-125, limits the total bond amount required collectively of all appellants not to exceed $25 million. However, if it is found that an appellant is intentionally dissipating or diverting assets for the purpose of avoiding payment of the judgment, the court may order the appellant to post an increased bond amount up to the judgment amount.
C.R.C.P. 62. Stay of Proceedings to Enforce a Judgment
(a) Automatic Stay; Exceptions; Injunctions; Receiverships. Except as stated herein, no execution shall issue upon a judgment nor shall proceedings be taken for its enforcement until the expiration of 14 days after its entry; provided that an interlocutory or final judgment in an action for an injunction or in a receivership action shall not be stayed during the period after its entry and until an appeal is taken or during the pendency of an appeal. Unless otherwise ordered by the court, the provisions of section (c) of this Rule govern the suspending, modifying, restoring, or granting of an injunction during the pendency of an appeal.
(b) Discretionary stay. In its discretion and on such conditions for the security of the adverse party as are proper, the court may stay the execution of, or any proceedings to enforce, a judgment: (1) pending the disposition of a motion for post-trial relief made pursuant to C.R.C.P. 59; (2) pending a motion for relief from a judgment or order made pursuant to C.R.C.P. 60; (3) during the time permitted for filing of a notice of appeal; or (4) during the pendency of a motion for approval of a supersedeas bond.
COMMITTEE COMMENT
The 1988 amendment to C.R.C.P. 62(b) is a change to make that section fully consistent with the changes made to C.R.C.P. 59. The post-trial relief features of C.R.C.P. 50 and 52(b) were brought into C.R.C.P. 59. As a result, those Rules (50) and (52) no longer bear on post-trial relief and need not be referenced in C.R.C.P. 62.
(c) Injunction Pending Appeal. When an appeal is taken from an interlocutory or final judgment granting, dissolving, or denying an injunction, the trial court in its discretion may suspend, modify, restore, or grant an injunction during the pendency of the appeal upon such terms as to bond or otherwise as it considers proper for the security of the rights of the adverse party.
(d) Stay upon Appeal. When an appeal is taken the appellant by giving a supersedeas bond may obtain a stay from the trial court subject to the exceptions contained in section (a) of this Rule. The bond may be given at or after the time of filing the notice of appeal or of procuring the order allowing the appeal, as the case may be. The stay is effective when the supersedeas bond is approved by the court.
(e) Stay in Favor of the State of Colorado or Municipalities Thereof. When an appeal is taken by the State of Colorado, or by any county or municipal corporation of this state, or of any officer or agency thereof acting in official capacity and the operation or enforcement of the judgment is stayed, no bond, obligation, or other security shall be required from the appellant unless otherwise ordered by the court.
(f) [There is no section (f).]
(g) Power of Appellate Court Not Limited. The provisions in this Rule do not limit any power of the appellate courts or of a justice or judge thereof to stay proceedings during the pendency of an appeal or to suspend, modify, restore, or grant an injunction during the pendency of an appeal or to make any order appropriate to preserve the status quo or the effectiveness of the judgment subsequently to be entered. (See Rule 8, Colorado Appellate Rules.)
(h) Stay of Judgment as to Multiple Claims or Multiple Parties. When a court has ordered a final judgment under the conditions stated in Rule 54(b), the court may stay enforcement of that judgment until the entering of a subsequent judgment or judgments and may prescribe such conditions as are necessary to secure the benefit thereof to the party in whose favor the judgment is entered.
*This does not constitute legal advice, please read our disclaimer.
C.R.C.P. 121 - Section 1-23 Bonds in Civil Actions
*This does not constitute legal advice, please read our disclaimer.
CO Rev Stat 13-16-125
*This does not constitute legal advice, please read our disclaimer.
Who Needs Supersedeas Bonds in Colorado State Cases?
Supersedeas bonds are typically a requirement in Colorado courts to supersede a judgment while the appellant seeks to overturn a verdict on appeal. Here are the common types of cases that require supersedeas bonds in Colorado.
Here are a few common cases that require appeal bonds in Louisiana:
- Contract Disputes
- Class Action Lawsuits
- Personal Injury Lawsuits
- Property Disagreements
- Business Litigation
- Employment Law Disputes
- Product Liability Claims
- Intellectual Property Conflicts with Monetary Awards
- Toxic Tort Litigation
- Domestic Relations Cases involving property division, alimony, or child support (click here to read our article on Appeal Bonds in Family Law Cases)
Colorado Supersedeas Bonds Underwriting Requirements
While supersedeas bonds are technically insurance products issued by surety companies, they function more like a financial guarantee whereby the surety is guaranteeing to pay the judgment to the appellee up to the bond amount if the judgment is not satisfied by the appellant. Unlike insurance, however, the appellant has to indemnify or repay the surety if the surety pays the judgment. Consequently, supersedeas bonds are generally considered an extension of credit and underwritten more like bank loans.
Considering that most appeals do not result in a reversal of the judgment or order, there is a strong likelihood that the surety providing the supersedeas bond will receive a claim. As a result of this high probability, surety companies generally require collateral for the full bond amount.
However, there are exceptions to the collateral requirement, such as if an appellant has a significant net worth and liquid assets relative to the bond amount. Publicly traded companies, banks, insurers, large private firms, and high-net-worth individuals may meet these requirements, and not need to post collateral. (Find out if your client may qualify for an appeal bond without collateral, here.)
Common forms of collateral include:
- Cash: This is the quickest and simplest way to secure a supersedeas bond.
- Bank Letters of Credit: These are a written guarantee from a bank to the surety that promises payment of the required amount upon demand by the surety.
- Real Estate: This could include both residential properties (single-family and multi-family) and commercial properties (office, industrial, or retail).
- Marketable Securities: Non-retirement brokerage accounts holding stocks and bonds that are pledged to a surety company.
FAQs
How Much Does a Supersedeas Bond Cost in Colorado?
The cost of a Colorado supersedeas bond is determined by the premium rate set by surety companies, which are commonly in the 0.30% to 4% range based on the total bond amount and are dependent on the following factors:
- Bond amount requirement
- Type of collateral provided (if required)
- Financial stability of the appellant relative to the bond amount (if the bond is being considered without collateral)
Thus, if a surety is charging a 1% premium rate on a $2 million bond, the annual premium would equal $20,000.
Surety companies charge premiums for supersedeas bonds yearly until their liability under the bond is released. The first year’s premium is considered fully earned upon bond issuance, and the bond automatically renews on an annual basis. After the first year, if the appeal is concluded midterm, and the surety is then exonerated from liability, they will prorate the renewal premium and issue a refund back to the client.
Best Practices for Posting a Colorado Supersedeas Bond Through a Corporate Surety Company
Supersedeas bonds can take anywhere from a couple of days to several weeks to put in place, depending on the client’s circumstances. Here are the best practices to help ensure a smooth process in securing a supersedeas bond for your client:
- Engage a Supersedeas Bond Expert Early –
It is never too early to start discussions with a surety agent. When possible, reach out before the judgment has been entered because when it comes to supersedeas bonds, “more time” equals “more options” to allow the surety agent to find the best solution for the client’s unique circumstances. - Ensure Attorney Collaboration – It is best when the attorney is able to confirm the bond amount based on jurisdictional requirements, outline which parts of the judgment need to be bonded, keep the surety company informed of filing deadlines, and review the bond form for compliance with State or local court rules.
- Choose a Surety Partner with Proven Expertise – Not all surety agencies are the same. Selecting a provider with a proven strong track record in issuing Colorado supersedeas bonds ensures your client receives specialized guidance and a smooth approval process. At CSBA, we bring decades of experience exclusively handling civil litigation bonds nationwide.
See our guide, “The Biggest Mistakes Made with Appeal Bonds,” to learn more.
Why Choose CSBA for Your Clients' Colorado Supersedeas Bond?
When your client needs to stay enforcement of a judgment, they need a professional surety agent who can guide them through this difficult process.
A Legacy of Expertise & Trust
Since 1984, CSBA has helped appellants from all different industries involved in almost every type of case imaginable secure supersedeas bonds to stay enforcement of Colorado judgments. Whether your client is an individual appealing a $1 million judgment, or a publicly traded international company needing a $1 billion supersedeas bond, our team is able to leverage our 110 years of combined experience to assist in securing a supersedeas bond for your client with competitive terms.
Exclusive Surety InsurerAccess & Creative Solutions
CSBA has exclusive and semi-exclusive access to top admitted surety insurers, allowing us to handle any size supersedeas bond with creative collateral solutions tailored to your client’s specific financial situation. Whether the bond amount is small or large, we ensure that appellants and their attorneys receive first-class service and the best possible terms for their supersedeas bonds.
How Long Does It Take to Secure a Supersedeas Bond in Colorado?
If collateral isn’t required to secure a supersedeas bond, a Colorado supersedeas bond can be approved and issued in as little as 24 hours in the most straightforward cases.
If collateral is required, the process can vary significantly and mainly depends on the type of collateral being used. For example, cash collateral can be posted within a few days, while real estate can take 30-60 days, depending on the type and number of properties being posted.
Steps to Apply for a Supersedeas Bond
1. Contact a Supersedeas Bond Specialist – Consult with a surety expert to review your client’s bond amount, financial qualifications, and go over available collateral options. We recommend that the client contact CSBA early so that we can prevent setbacks, and ensure that all necessary steps are completed on time.
2. Explore All Available Options – The surety agent will discuss customized solutions based on your client’s financial situation. If your client may qualify for a supersedeas bond without full collateral, we will go over the underwriting requirements and answer any questions.
3. Submit Required Documentation – To begin the underwriting process, the following documents are required:
- Supersedeas bond application
- Court complaint
- Judgment
- Notice of appeal
- CPA-audited year-end financial statement (if the client is a candidate for an appeal bond without full collateral)
4. Secure Approval & Finalize the Bond – Once the underwriting documents have been received, your surety agent will review them internally and:
- Work to obtain competitive terms from a surety insurer.
- Outline the supersedeas bond approval for your client.
- Guide the client in the posting of the collateral, if required.
Get a Free Quote for Your Client's Supersedeas Bond in Colorado Today
Filing deadlines for supersedeas bonds are often strict and time-sensitive. At CSBA, we specialize in simplifying the underwriting process, ensuring a smooth experience so you and your client can focus on the case at hand. Our team of dedicated surety experts is ready to assist you—contact us today to take the next step in securing your client’s supersedeas bond in Colorado.