What Is a Judicial Bond?

Where judicial bonds arise

Courts require security in a range of situations: obtaining a provisional remedy such as attachment, injunction or replevin; securing the release of property; or protecting the opposing party against damages if a remedy is later found to have been improperly obtained. The bond exists because the court is granting relief before the merits are finally decided.

Amount, form and validity

These are determined by the court, not by the applicant or the surety. The order or the applicable rule fixes the amount and often the form of the undertaking. Validity generally runs with the proceeding or until the court discharges the bond, which means these bonds can remain outstanding for a long time.

What underwriting looks at

Because exposure is defined by a court order and can persist for years, judicial bonds are typically reviewed closely. Underwriters look at the nature of the proceeding, the amount, the applicant's financial position and the indemnity offered. Collateral or additional security is more common here than in ordinary contract bonds.

Documents commonly required

• The court order, pleading or rule stating the bond requirement and amount.
• Case details, including court, case number and the parties.
• Company or individual financial documents.
• Signed indemnity documentation, and collateral where the insurer requires it.

Practical points

Work from the order itself rather than a description of it, since the wording controls the undertaking. Coordinate with counsel on timing, because provisional remedies are usually time-sensitive. Ask the court to discharge the bond once the proceeding ends; bonds left outstanding continue to tie up capacity and collateral.

The applicable insurer determines requirements, terms, pricing and issuance. Nothing here is legal advice — consult your counsel on the requirement in your case.