When a Texas court enters a judgment, enforcement typically cannot begin until 30 days after the judgment is signed, providing the losing party a window to secure a stay. Texas Rule of Appellate Procedure 24 provides a mechanism to pause enforcement by posting a bond. This helps you protect assets while your appeal moves forward.
Securing a stay with supersedeas bonds
Posting a supersedeas bond typically allows you to obtain a stay, stopping the winning party from collecting the judgment or taking your property during the appeals process. For money judgments, Texas Civil Practice and Remedies Code caps the required security at the lesser of 50% of the judgment debtor’s net worth or $25 million.
Seeking alternate forms of security
You can deposit cash directly with the trial court clerk without judge approval, though court permission is required if you wish to post alternate non-cash security. An experienced appellate attorney can evaluate which assets best meet the court’s security requirements while minimizing disruption to your finances.
This flexibility can be valuable if your assets are concentrated in illiquid holdings like real property or business equity. Liquidating those assets to fund a cash bond could cause significant financial disruption. This allows for security arrangements that protect both parties.
Challenging the sufficiency of security
The prevailing party may challenge security adequacy to ensure that sufficient assets remain available to satisfy the judgment. The court may require more security if the value of the posted asset drops significantly. Opposing lawyers often file motions to contest:
- The judgment debtor’s claimed net worth
- The surety’s financial condition or solvency
- The current market value of posted assets
The court may require new security if your surety becomes insolvent or faces financial distress. The trial court may lift the stay if you fail to provide updated security.
What happens after the court rules on your stay
If the appellate court reverses the judgment, the stay protects you from satisfying an overturned judgment. If the court affirms the judgment, the court lifts the stay and the prevailing party moves to execute.
A stay under Texas Rule of Appellate Procedure 24 only protects you if the security remains valid. If a challenge succeeds, the stay can collapse and expose you to enforcement. Reviewing your security structure with an appellate attorney early in the process can help you avoid a lapse in coverage before the appeal concludes.
