Nebraska Supersedeas Bonds
What is a Nebraska Supersedeas Bond?
While a client can file a notice of appeal without a bond, the bond is the legal requirement to stay the enforcement of a judgment while the case is on appeal. In Nebraska, an appeal does not automatically operate as a supersedeas. Per Neb. Rev. Stat. § 25-1916, an appellant must execute a bond to the adverse party within 30 days after the entry of the judgment to pause collection efforts.
When the judgment or final order is for the payment of money, a Nebraska supersedeas bond ensures that the appellant will prosecute the appeal without delay and pay all “condemnation money,” costs, and damages if the appeal is unsuccessful. The supersedeas bond must be written by a corporate surety company authorized to do business in the State of Nebraska, and the bond must be approved by the trial court in which the judgment was rendered in order for the general lien of the judgment to be dissolved.
If you’re an attorney handling your client’s case in Nebraska, here are the requirements and statutory caps for securing a supersedeas bond.
Nebraska Supersedeas Bond Amount Requirements
Nebraska Revised Statute § 25-1916 outlines the specific requirements for the bond amount. For judgments directing the payment of money, the amount is determined by the lesser of the following three figures:
- The sum of the judgment amount, taxable court costs in the district court, the estimated interest that will accrue during the appeal, and estimated appellate costs.
- Fifty percent (50%) of the appellant’s net worth.
- $50 million.
It is important to note that under § 25-1916(1), the $50 million and net worth caps may be bypassed by the court if the appellee proves by a preponderance of the evidence that the appellant is dissipating or diverting assets outside the ordinary course of business to avoid payment.
Nebraska Revised Statutes 25-1916; Appeal; supersedeas; cash or bond; effect; undertakings; amount, terms, and conditions; effect of having corporate surety.
No appeal in any case shall operate as a supersedeas unless the appellant or appellants within thirty days after the entry of such judgment, decree, or final order execute to the adverse party a bond with one or more sureties, make a deposit of United States Government bonds with the clerk, or in lieu thereof make a cash deposit with the clerk for the benefit of the adverse party as follows:
(1) When the judgment, decree, or final order appealed from directs the payment of money, the bond, deposit of United States Government bonds, or cash deposit shall be the lesser of (a) the amount of the judgment, decree, or final order and the taxable court costs in the district court, plus the estimated amount of interest that will accrue on the judgment, decree, or final order between its date and the final determination of the cause in the Court of Appeals or Supreme Court and the estimated amount of the costs of appeal, such estimated interest to accrue and estimated court costs to be determined by the trial court, (b) fifty percent of the appellant’s net worth, or (c) fifty million dollars. If an appellee proves by a preponderance of the evidence that an appellant is dissipating or diverting assets outside the ordinary course of business to avoid the payment of a judgment, the court may enter any orders necessary to protect the appellee and require the appellant to provide a bond, deposit of United States Government bonds, or cash deposit up to and including the amount required under subdivision (1)(a) of this section.
Such bond, United States Government bond, or cash deposit shall be conditioned that the appellant or appellants will prosecute such appeal without delay and pay all condemnation money and costs which may be found against him, her, or them on the final determination of the cause in the Court of Appeals or Supreme Court. When a cash deposit is made, United States Government bonds are deposited, or a bond is provided which is written by a corporate surety company authorized to do business within the State of Nebraska and the cash deposit, United States Government bonds, or supersedeas bond is approved by the trial court in which the judgment was rendered and filed in the court, the general lien of the judgment shall be dissolved;
(2) When the judgment, decree, or final order directs the execution of a conveyance or other instrument, the bond, deposit of United States Government bonds, or cash deposit shall be in such sum, not exceeding the lesser of fifty percent of the appellant’s net worth or fifty million dollars, as shall be prescribed by the district court, or judge thereof in vacation, conditioned that the appellant or appellants will prosecute such appeal without delay and will abide and perform the judgment or decree rendered or final order which shall be made by the Court of Appeals or Supreme Court in the cause;
(3) When the judgment, decree, or order directs the sale or delivery of possession of real estate, the bond, deposit of United States Government bonds, or cash deposit shall be in such sum, not exceeding the lesser of fifty percent of the appellant’s net worth or fifty million dollars, as the court, or judge thereof in vacation, shall prescribe, conditioned that the appellant or appellants will prosecute such appeal without delay, will not during the pendency of such appeal commit or suffer to be committed any waste upon such real estate, and will pay all costs and all rents or damages to such real estate which may accrue during the pendency of such appeal and until the appellee is legally restored thereto; and
(4) When the judgment, decree, or final order dissolves or modifies any order of injunction which has been or hereafter may be granted, the supersedeas bond, deposit of United States Government bonds, or cash deposit shall be in such reasonable sum, not exceeding the lesser of fifty percent of the appellant’s net worth or fifty million dollars, as the court or judge thereof in vacation shall prescribe, conditioned that the appellant or appellants will prosecute such appeal without delay and will pay all costs which may be found against him, her, or them on the final determination of the cause in the Court of Appeals or Supreme Court. Such supersedeas bond, deposit of United States Government bonds, or cash deposit shall stay the doing of the act or acts sought to be restrained by the suit and continue such injunction in force until the case is heard and finally determined in the Court of Appeals or Supreme Court. The undertaking given upon the allowance of the injunction shall be and remain in effect until it is finally decided whether or not the injunction ought to have been granted.
The changes made to this section by Laws 2004, LB 1207, shall apply to all cases pending on or filed on or after April 16, 2004.
*This does not constitute legal advice, please read our disclaimer.
Who Needs Supersedeas Bonds in Nebraska State Cases?
Aside from judgments against most public entities, judgment debtors are required to post a supersedeas bond or other security to prevent judgment execution during the appeal.
Here are some of the cases that may require supersedeas bonds in Nebraska courts:
- 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
Nebraska Supersedeas Bonds Underwriting Requirements
Appeal bonds are technically an insurance product issued primarily by corporate surety companies. However, these bonds are more like an extension of credit and are therefore underwritten similar to bank loans.
Appeal bonds function more like financial guarantees, where the surety company guarantees to pay the judgment to the appellee up to the bond amount if the appellant doesn’t satisfy the judgment should it be affirmed on appeal.
Unlike insurance products, the appellant has to repay the surety company if the surety ends up satisfying the judgment. Because most civil appeals result in the judgment being affirmed, there is a high probability that the surety company backing the supersedeas bond will receive a claim. Given the likelihood of a claim, surety companies will often require collateral for the full bond amount.
There are exceptions to the collateral requirement, and those are generally when the appellants are publicly traded companies, banks, insurers, large private firms, municipalities, or high-net-worth individuals who meet particular criteria, such as if the appellant has a significant net worth and liquid assets relative to the bond amount. See our article, “Qualifying for a Supersedeas Bond Without Collateral,” for additional content.
Common forms of collateral include:
- Cash: This is generally the most streamlined collateral option for clients when dealing with a tight deadline.
- Bank Letters of Credit: A formal guarantee from a bank to a surety ensuring the availability of funds up to a certain dollar amount upon demand.
- Real Estate: Acceptable collateral may include residential properties (single-family or multi-family) and commercial properties (office, industrial, or retail). However, due to the homestead laws in Nebraska, the property cannot be the client’s primary residence.
- Marketable Securities: Non-retirement brokerage accounts holding stocks and bonds can be pledged as collateral, offering a creative option for securing a supersedeas bond without having to liquidate assets.
FAQs
How Much are the Premium Rates for Nebraska Supersedeas Bonds?
The cost of a Nebraska supersedeas bond is determined by the premium rate, which typically ranges from 0.30% to 4% of the total bond amount. The exact premium rate will depend on several factors, such as:
- The size of the bond requirement
- The type of collateral provided if required
- The financial strength of the appellant relative to the bond amount, if the bond is being considered without collateral
For example, if the supersedeas bond is required for $8,000,000 and the premium rate is set at 0.75%, the bond premium would be $60,000. It’s important to know that surety companies charge premiums for supersedeas bonds annually until their liability under the bond has been released. The premium for the first year is considered fully earned once the bond is issued, and any renewal premiums for subsequent years are prorated if the bond is exonerated midterm.
What are the Best Practices for Securing a Supersedeas Bond through an Admitted Surety Insurer?
Securing a Nebraska supersedeas bond can be complex. However, following best practices can help ensure a smooth experience. Here’s what we recommend:
- Contact a surety bond agent early. This advantage helps the client explore all options and ensure the supersedeas bond can be filed without delay.
- Ensure attorney involvement. Attorneys are critical in confirming the bond amount based on the jurisdiction’s requirements and parts of the judgment being bonded, updating the surety company on the deadline to file the bond, and reviewing the bond form to ensure it conforms with local rules.
- You can choose the right surety bond agent by interviewing multiple professionals and choosing one with a strong track record of experience and who specializes in Nebraska supersedeas bonds.
See our guide, “The Biggest Mistakes Made with Appeal Bonds,” to learn more.
Why Choose CSBA for Your Clients' Nebraska 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 Nebraska 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 Insurer Access & 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 Nebraska?
If collateral isn’t required to secure a supersedeas bond, a Nebraska 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
- 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.
- 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.
- Submit the following documents:
- Application
- Court complaint
- Judgment
- Notice of appeal
- CPA Audited Year-end Company Financial Statement if the client may be a candidate to qualify for an appeal bond without collateral.
- 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 Nebraska Supersedeas Bond Today
Filing a supersedeas bond comes with strict deadlines, and securing a Nebraska supersedeas bond requires a knowledgeable and responsive surety agent who understands the complexities of the court requirements. At CSBA, we specialize exclusively in appeal and civil litigation bonds, ensuring a fast approval process so you can focus on your case.