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Sequestration Surety Bond

Sequestration refers to a process through which the plaintiff in civil litigation seizes money or property belonging to the defendant in the litigation before the hearing actually begins. If you plan to pursue sequestration, you will likely need a bond before the seizure can proceed.

What is a Sequestration Bond?

Sequestration bonds hold the plaintiff financially responsible if the judge rules against him in the sequestration hearing. In addition to returning the property that was initially seized, plaintiffs may have to pay damages and cover the defendant's court costs and attorney's fees. If the plaintiff refuses to pay, however, the defendant can file a claim against the bond. As long as that claim is valid, the surety company backing the bond agrees to pay the claimant, but they also have the right to collect any amount they pay out from the bonded party. By holding plaintiffs financially responsible when judges rule against them, bonds help keep frivolous litigation out of the courts.

How does a Sequestration Surety Bond work?

A judge will require a plaintiff to obtain a bond before the sequestration hearing begins. Then, if the plaintiff refuses to settle with the defendant in whatever amount the judgement calls for, the defendant can file a claim against the bond seeking compensation for damages. The bonded party (the plaintiff) must either settle at that point or settle with the surety later. However, if the surety steps in to pay, the principal has to pay interest, fees, and costs in addition to the debt.

Who should get a Sequestration Bond?

If you want to pursue a sequestration, you will likely need a bond. The judge in your case and your counsel will make this clear. Upon learning of the bond requirement, begin considering bond options immediately because your case can't proceed until you have one.

Who are the parties involved in a Sequestration Surety Bond?

Unlike loan or insurance agreements that involve two parties, bond agreements involve three:

• Principal - The party that obtains the bond and also the plaintiff in the sequestration case.
• Obligee - The party that benefits from the bond and also the defendant in the sequestration.
• Surety - The company that issues the bond, investigates claims, and compensates the obligee when necessary.

How much does a Sequestration Bond cost?

The cost of bonds depends on the overall value, which a judge determines. The principal will pay a premium equal to a small percentage of the sequestration bond amount. How much, exactly, depends on the credit score and history of the applicant. Applicants with a low credit score or a blemish on their credit will pay a slightly higher percentage, but in most cases they are not denied bonds.

How are claims handled for Sequestration Surety Bonds?

In order to avoid paying out false claims, sureties investigate every claim they receive. In cases where the claim is valid but the principal refuses to settle it, the surety guarantees payment up to the total value of the bond. At this point, the claim is settled, but the principal now owes a debt to the surety. Regardless of willingness to pay, the principal always has the final financial responsibility for claims.

How to apply for a Sequestration Surety Bond?

At Viking Bond Service, we make the application process as quick and easy as possible. You will submit a bond application as well as the court order detailing what kind of bond you require. You may need to supply additional documentation as well if the surety requires it. You will next receive a quote for the premium price, and once it's paid, your bond is active and the sequestration can proceed.

Viking Bond Service - Working 24/7 in All 50 States

As a nationwide surety brokerage, Viking Bond Service issues bonds in all 50 states. And thanks to our online bond application, you can start the bond process at any time and expect to receive a quote in under 48 hours. If you need more information before applying, please contact us through the form on this page or by calling 888-278-7389.