Nevada Supersedeas Bonds

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What are Nevada Supersedeas Bonds?

While a client can file an appeal without a supersedeas bond, the bond is the primary legal mechanism required to stay the execution of a judgment while the case is on appeal. The Nevada Rules of Civil Procedure, Rule 62(a) provides an automatic stay of execution for 30 days after service of written notice of the judgment’s entry. To maintain this stay throughout the appellate process, a supersedeas bond must be provided.

A Nevada supersedeas bond serves as a financial guarantee that the judgment creditor (appellee) will be protected and paid if the appeal is unsuccessful. Per NRCP 62(d), the stay becomes effective once the supersedeas bond is filed.

If you’re an attorney handling your client’s case in Nevada, here are the requirements and statutory caps for securing a supersedeas bond.

Nevada Supersedeas Bond Amount Requirements

Nevada Rules of Civil Procedure 62 and Nevada Revised Statute 20.037 outline the specific requirements for the bond amount and the conditions for staying a money judgment. Here are the key highlights to be aware of:

  • Statutory Caps: Under NRS 20.037, Nevada limits the total cumulative sum of all the bonds required from all appellants collectively to the lesser of $50 million or the total amount of the judgment.
  • Small Business Protections: If an appellant qualifies as a “small business concern” (as defined by the federal Small Business Act), the maximum bond amount is significantly reduced. The cap for small businesses is the lesser of $1 million or the total amount of the judgment.
  • Exception for Asset Dissipation: If the respondent proves by a preponderance of the evidence that the appellant is purposefully dissipating or diverting assets outside the ordinary course of business to avoid payment, the court may rescind the caps and require a bond for the full amount of the judgment.
  • Government Exemptions: Under NRCP 62(e), the State of Nevada, its political subdivisions (counties, cities, towns), and their agencies or officers are exempted from the requirement of posting a bond to stay execution.

Stay of Proceedings to Enforce a Judgment

      (a) Automatic Stay; Exceptions for Injunctions and Receiverships.

             (1) In General.  Except as stated in this rule, no execution may issue on a judgment, nor may proceedings be taken to enforce it, until 30 days have passed after service of written notice of its entry, unless the court orders otherwise.

             (2) Exceptions for Injunctions and Receiverships.  An interlocutory or final judgment in an action for an injunction or a receivership is not automatically stayed, unless the court orders otherwise.

      (b) Stay Pending the Disposition of Certain Postjudgment Motions.  On appropriate terms for the opposing party’s security, the court may stay execution on a judgment—or any proceedings to enforce it—pending disposition of any of the following motions:

             (1) under Rule 50, for judgment as a matter of law;

             (2) under Rule 52(b), to amend the findings or for additional findings;

             (3) under Rule 59, for a new trial or to alter or amend a judgment; or

             (4) under Rule 60, for relief from a judgment or order.

      (c) Injunction Pending an Appeal.  While an appeal is pending from an interlocutory order or final judgment that grants or refuses to grant, or dissolves or refuses to dissolve, an injunction, the court may stay, suspend, modify, restore, or grant an injunction on terms for bond or other terms that secure the opposing party’s rights.

      (d) Stay Pending an Appeal.

             (1) By Supersedeas Bond.  If an appeal is taken, the appellant may obtain a stay by supersedeas bond, except in an action described in Rule 62(a)(2). The bond may be given upon or after filing the notice of appeal or after obtaining the order allowing the appeal. The stay is effective when the supersedeas bond is filed.

             (2) By Other Bond or Security.  If an appeal is taken, a party is entitled to a stay by providing a bond or other security. Unless the court orders otherwise, the stay takes effect when the court approves the bond or other security and remains in effect for the time specified in the bond or other security.

      (e) Stay Without Bond on Appeal by the State of Nevada, Its Political Subdivisions, or Their Agencies or Officers.  When an appeal is taken by the State or by any county, city, town, or other political subdivision of the State, or an officer or agency thereof, and the operation or enforcement of the judgment is stayed, no bond, obligation, or other security is required from the appellant.

      (f) Reserved.

      (g) Appellate Court’s Power Not Limited.  This rule does not limit the power of an appellate court or one of its judges or justices:

             (1) to stay proceedings—or suspend, modify, restore, or grant an injunction—while an appeal is pending; or

             (2) to issue an order to preserve the status quo or the effectiveness of the judgment to be entered.

      (h) Stay With Multiple Claims or Parties.  A court may stay the enforcement of a final judgment entered under Rule 54(b) until it enters a later judgment or judgments, and may prescribe terms necessary to secure the benefit of the stayed judgment for the party in whose favor it was entered.

Source

*This does not constitute legal advice, please read our disclaimer.

Limitation on amount of bond to secure stay of execution of judgment pending appeal; exceptions.

      1.  Notwithstanding any other provision of law or court rule, and except as otherwise provided in this section and NRS 20.035, if an appeal is taken of a judgment in a civil action in which an appellant is required to give a bond in order to secure a stay of execution of the judgment during the pendency of any or all such appeals, the total cumulative sum of all the bonds required from all the appellants involved in the civil action must not exceed the lesser of $50,000,000 or the amount of the judgment.

      2.  If an appellant is a small business concern, the amount of the appellant’s bond required pursuant to subsection 1 must not exceed the lesser of $1,000,000 or the amount of the judgment.

      3.  If the plaintiff proves by a preponderance of evidence that an appellant who posted a bond pursuant to subsection 1 or 2 is purposefully dissipating or diverting assets outside of the ordinary course of its business to evade the ultimate payment of the judgment, the court may, if the court determines that such an order is necessary to prevent such dissipation or diversion, require the appellant to post a bond in an amount that does not exceed the full amount of the judgment.

      4.  The provisions of this section do not limit the discretion of a court, for good cause shown, to set the bond on appeal in an amount less than the amount otherwise required by law.

      5.  For the purposes of this section, “small business concern” has the meaning ascribed to it in the Small Business Act, 15 U.S.C. §§ 631 et seq., and any regulations adopted pursuant thereto.

      (Added to NRS by 2015, 1521)

Source

*This does not constitute legal advice, please read our disclaimer.

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Who Needs Supersedeas Bonds in Nevada 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 Nevada 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

Nevada Supersedeas Bonds Underwriting Requirements

Supersedeas 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.

Supersedeas 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 an Appeal Bond Without Collateral,” for additional content.

Common forms of collateral include:

FAQs

A Nevada supersedeas bond cost is determined by the premium rate set by a surety company, which is generally between 0.3% to 4% depending on several factors such as:

  • The size of the supersedeas bond 
  • 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 

The bond premium is charged yearly until the surety’s liability under the bond is fully released. If the bond is exonerated midterm after the first year’s renewal, the client will receive a prorated return premium from the surety company.

Securing a Nevada supersedeas bond can be complex. However, following best practices can help ensure a smooth experience. Here’s what we recommend:

  1. Contact a surety bond agent early. This advantage helps the client explore all options and ensure the supersedeas bond can be filed without delay.
  2. 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.
  3. 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 Nevada supersedeas bonds.

For more insights, check out our guide: “The Biggest Mistakes Made with Appeal Bonds.“

If your client needs to stay enforcement of a Nevada judgment, they need a professional surety agent who can use a wide variety of collateral options and who has access to the right surety companies.

A Legacy of Expertise & Trust

Since 1984, CSBA has provided first-class service through our expertise in the appellate process, underwriting requirements, and the time frames required to secure a bond before the filing deadline. With our combined experience of 110 years, our surety bond professionals anticipate potential setbacks and take proactive steps to tailor options unique to your client’s financial situation.

Exclusive Surety Insurer Access & Creative Solutions

At CSBA, we leverage our extensive network of over 30 surety insurers for clients seeking to secure a Nevada supersedeas bond. Our long-standing relationships with top-tier surety companies allow us to handle bond amounts of all sizes, whether it’s a $1 million supersedeas bond for a private individual or a $1 billion supersedeas bond for a publicly traded corporation.

With access to exclusive and semi-exclusive sureties we offer:

  • Creative collateral solutions tailored to each client’s financial profile.
  • Expedited underwriting to ensure a streamlined bonding process.
  • Comprehensive support and guidance to attorneys and their clients throughout the supersedeas bond process.

Our specialized expertise and direct surety relationships set us apart, making CSBA the trusted choice to attorneys and their clients for supersedeas bonds in Nevada cases.

The time frame to secure a Nevada supersedeas bond will depend on whether or not collateral is required.

If collateral isn’t required, the bond can be approved and issued within 24 hours in the most straightforward cases.

If the surety does require collateral, the type of collateral can affect the duration of securing a supersedeas bond. Cash collateral can be secured in a few days, while real estate collateral can generally take 30-60 days, depending on the property type and number of properties being posted.

Steps to Apply for a Supersedeas Bond

  1. Contact a supersedeas bond specialist to review your client’s bond requirement and start the process.
  2. The bond agent will discuss the various options with you and your client, and address any underwriting questions you or the client may have.
  3. Submit the following documents:
  4. The surety agent will outline the supersedeas bond approval, and work closely with you and your client to efficiently finalize the bond.

Get a Free Quote for Your Client's Nevada Supersedeas Bond Today

Filing a supersedeas bond comes with strict deadlines, and securing a Nevada 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.

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