Surety and Cash Bonds Surety and Cash Bonds In Non-Criminal Proceedings Civil, Probate and Family Proceedings And Other Bonds Surety Surety (Black’s Law Dictionary): A person who is primarily liable for the payment of another’s debt or the performance of another’s obligation. Although a surety is similar to an insurer, one important difference is that a surety often receives no compensation for assuring liability. A surety differs from a guarantor, who is liable to the creditor only if the debtor does not meet the duties owed to the creditor; the surety is directly liable. 1
Bond Bond A written promise to pay money or do some act if certain circumstances occur or a certain time elapse; a promise that is defeasible upon a condition subsequent. Basically, a guarantee to perform. A surety bond is defined as a contract among at contract among at least three least three parties: the obligee : the party who is the recipient of an parties obligation. the principal: the primary party who will perform the contractual obligation. the surety: who assures the obligee that the principal can perform the task. Surety Surety bonds onds are designed to protect public or private interests from the actions of a third-party. You You can think of a surety surety bond ond like insurance that’s for the benefit of one party, paid for by a second party, and financed by a third party. 2
The difference between a property bond and a surety bond is simply who is ult who is ultima mate tely liabl ly liable for payi e for paying the bond off in the event the bond off in the event of a final of a final judgment judgment of forfeiture of forfeiture. A surety bond is back backed ed by a surety (or insurance) agency that the bondsman is qualified to write bonds on behalf and the bond works more or less like an insurance policy. Through a surety bond, the surety agrees to uphold—for the benefit of the obligee—the contractual promises (obligations) made by the principal if the principal fails to uphold its promises to the obligee. The contract is formed so as to induce the obligee to contract with the principal, i.e., to demonstrate the credibility of the principal and guarantee performance and completion per the terms of the agreement. 3
CIVIL CASES THAT REQUIRE A BOND TRO TRO: TEMPORARY RESTRAINING ORDER SEQUESTRATION SEQUESTRATION: The process by which property is removed from the possessor pending the outcome of a dispute. SUPERSEDEAS SUPERSEDEAS: [Latin “you shall desist”] a writ or bond that suspends a judgment creditor’s power to levy execution, pending an appeal; justice courts (JP) . CERTIORARI: [Latin “to be more fully informed”] An writ issued by an CERTIORARI appellate court to a lower court to deliver the record in a case for review. The bond is to cover court cost. RECEIVERSHIP RECEIVERSHIP: The position or function of being a receiver appointed by a court. The receiver is a disinterested party for the protection or collection of property that is the subject of litigation. Bond For Gar Bond For Garnishment ent for writs of garnishment BEFORE BEFORE JUDGME JUDGMENT NT : (seizures) 4
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CLERK’S RESPONSIBILITY CLERK’S RESPONSIBILITY On An Order of the Court the Clerk shall: Deposit funds (bond) in the registry of the Court, along with a copy of the Order Setting Bond Placed in “Restricted Deposit”. In Dallas County, this would be the County Clerk’s Special Fund 501 Upon Order of the Court to Release Funds, the bond amount (minus cost, if any) is disbursed to the designee named in the Court Order 10
BOND TYPES Deposit in Lieu of Surety Bond (Rule 14c) Bond on Dissolution (Rule 691) On Official Bonds (Rule 35) Bond in Divorce Case (Rule 693a and 695a) Different Officials and Bondsmen (Rule 36) Bond for Sequestration (Rule 698) Judgment on Cost Bond (Rule 144) Bond for Personal Property (Rule 702) Secured By Other Bond (Rule 148) Bond for Real Estate Sale (Rule 703) Bond for Attachment (Rule 592) Return of Bond and Entry of Judgment (Rule 704) Form of Attachment Bond (Rule 592a) When Bond Forfeited (Rule 709) Bond of Application for Sale (Rule 602) Purchaser’s Bond (Rule 714) Bond for Distress Warrant (Rule 611) Return of Bond (Rule 715) May Give Delivery Bond (Rule 644) Recovery of Bond (Rule 716) Forfeited Delivery Bond (Rule 646) Bond (Rule 719)*** Bond for Garnishment (Rule 658a) Return of Bond (Rule 720) Applicant’s Bond (Rule 684) RESOURCE 11
Lastly, Public Official Bonds Sec. 82.001. SURETY BOND AND OATH OF COUNTY CLERK; SELF-INSURANCE. (a) (a) The county clerk must, before beginning to perform the duties of office, execute a bond either with four or more good and sufficient sureties or with a surety company authorized to do business in the state as a surety. (b) (b) In lieu of the clerk obtaining the bond, the county may self-insure against losses that would have been covered by the bond. (c) The bond must be: (c) (1) approved by the commissioners court; (2) made payable to the county; (3) conditioned that the clerk will faithfully perform the duties of office; and (4) in an amount equal to at least 20 percent of the maximum amount of fees collected in any year during the term of office preceding the term for which the bond is to be given, but not less than $5,000 or more than $500,000. ex. ex. If If the total the total fees collect fees collected ed in in a a given year is $250, given year is $250,000, that would be 000, that would be the the amount of amount of the the required bond. required bond. (d) (d) The clerk must take and subscribe the official oath, which must be endorsed on the bond if the bond is required. The bond and oath shall be recorded in the county clerk's office and deposi deposited in ed in the the office office of of the clerk the clerk of of the district the district court court . (e) An injured party in a suit to which the county is a party may use and enter in the record in the suit a certified copy of the (e) bond. Questions? 12
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