Court Bonds
A court bond is any surety bond required by a court. Court bonds fall into two main groups: judicial bonds, which are required of people involved in a lawsuit, and probate bonds, which are required of people a court appoints to manage someone else's property or estate. The bond protects the other party or the estate by guaranteeing that you will meet the obligations the court sets.
How a court bond works
The bond is an agreement among three parties: you, the person required to post the bond (principal); the court or the party the bond protects (obligee); and the surety that issues it. For example, if you take possession of property through a replevin action and the court later rules you weren't entitled to it, the other party may be able to recover their losses from your bond. If the claim is valid, the surety pays up to the bond amount.
Bond amount and your premium
The court or the law that applies to your case sets the bond amount, often based on the value of a judgment, the property involved or the size of an estate. That amount is the most the surety will pay on claims, not the price you pay. Your premium depends on the type of bond and the surety's underwriting, including your credit and finances. Some judicial bonds, such as appeal bonds, may also require collateral. Court deadlines are often short, so request a quote as soon as you know a bond is required.
Types of court bonds
Court bonds fall into two main groups. Names and requirements vary by state and court.
Judicial bonds
Required of people involved in a lawsuit.
Required when you ask the court to act against the other party's property before the case is decided.
Lets you recover property you claim, and protects the other party if the court later rules against you.
Lets you have the other party's property held to secure a possible judgment, and covers their losses if the attachment was wrongful.
Guarantees payment of court costs if your appeal is unsuccessful.
Protects a sheriff or marshal who seizes or sells property at your request.
Probate bonds
Required of people a court appoints to manage an estate or another person's finances.
Required when the court appoints someone to manage the estate of a person who died without a will, or whose will names no executor.
Required of the person named in a will to manage the estate, unless the will or the court waives the bond.
Required when the court appoints someone to manage the money or property of a minor child or an adult who can't manage their own affairs.
Required of someone appointed to manage the finances of an adult who can't manage them. Some states use guardian and conservator for different roles, and some use one term for both.
Judicial bonds vs. probate bonds
Judicial bonds come up during a lawsuit. They protect the other party if your court action, such as seizing property or delaying payment of a judgment while you appeal, causes them a loss you're responsible for. Probate bonds, also called fiduciary bonds, protect an estate and its heirs or creditors by guaranteeing that an administrator or executor handles the estate honestly and according to the court's orders.
What happens when a claim is filed
A claim is usually made by the party the bond protects, such as the opposing party in a lawsuit or an heir of an estate. The surety investigates. If the claim is not valid, it is denied. If it is valid, the surety pays the claimant up to the bond amount and you must repay the surety. The court may also hold you personally responsible for losses beyond the bond amount.
When the bond ends
Unlike most license bonds, court bonds usually don't renew on a fixed schedule. A judicial bond generally stays in force until the case is resolved and the court releases it. A probate bond stays in force until you finish administering the estate and the court discharges you. Until then, you may need to pay a premium each year to keep the bond active.
Not sure which bond you need?
WWIS is based in Litchfield Park, Arizona, is licensed in all 50 states and has helped people and businesses with court and surety bonds for more than two decades. Call 888-518-8011 or email [email protected] and we'll help you find the right bond for your case.
If you or your business needs help in obtaining a surety bond or commercial insurance give us a call!