CHAPTER 8 Staying Execution and Superseding the Judgment

JurisdictionUnited States


Staying Execution and Superseding the Judgment

8-1 Introduction

Ancillary to an appeal is the important matter of staying execution of the judgment during the appeal. If you are the judgment debtor seeking reversal of the judgment, knowing Texas supersedeas jurisprudence and the procedures required to effectively stay enforcement of the judgment is critical to your appeal.

The primary sources for Texas supersedeas law are:

• Chapter 52 of the Texas Civil Practice and Remedies Code;
• Rule 24 of the Texas Rules of Appellate Procedure; and
• Case law interpreting and applying these provisions.

8-1:1 What It Means to "Supersede" a Judgment

"Supersedeas" in Latin means "you shall desist," and is defined as "[a] writ or bond that suspends a judgment creditor's power to levy execution. . . ."1 Therefore, a properly superseded judgment suspends the enforcement process and permits the parties to maintain the status quo during the pendency of the appeal. This is so because, in addition to staying enforcement of the judgment, supersedeas at the same time provides the judgment creditor assurance that the judgment will be satisfied if the appeal is unsuccessful. If a writ of execution has been issued, the court clerk must immediately issue a writ of supersedeas once proper security is made.2

8-1:2 Voluntary Nature of Supersedeas

Superseding the judgment is voluntary and not necessary to perfect an appeal—an appeal may proceed without an appeal bond or other appellate security.3 A judgment debtor, therefore, may forgo the right to supersede the judgment when appealing the judgment. Of course, the judgment debtor runs the risk of the judgment creditor executing on the judgment during the appellate process. Even if execution occurs, the appeal will proceed.4

8-1:3 Final Judgment Necessary for Enforcement

The prevailing party may execute only on a final judgment. A judgment is final when it disposes of all claims, issues, and parties before the court, and no further action is required to determine the controversy.5 Such a judgment is final for purposes of appellate review.6 As a general rule, interlocutory orders may not be executed upon.7 However, as discussed below, under some limited circumstances, a trial court may permit a party to supersede an order granting temporary relief pending an appeal of that order.

8-1:4 Interlocutory Orders

8-1:4.1 Discretion to Permit Supersedeas

Under Rule 29.2, a "trial court may permit an order granting interlocutory relief to be superseded pending an appeal from the order. . . ."8 If that occurs, the party may supersede the order in the same manner as a final judgment.9 If the trial court refuses to allow suspension, the appellant may seek review of that ruling in an appellate court under an abuse-of-discretion standard.10 Additionally, during an appeal of an interlocutory order, the appellate court "may make any temporary orders necessary to preserve the parties' rights until disposition of the appeal and may require appropriate security."11 But if supersedeas would adequately protect an appellant's rights, the appellate court "must not suspend the trial court's order."12 An interlocutory order denying relief may not be suspended.13

8-1:4.2 Stay Pending Appeal

An appeal of an interlocutory order under section 51.014 of the Texas Civil Practice and Remedies Code stays the trial in the trial court "pending resolution of the appeal," except for appeals of temporary injunctions.14 If there is an appeal from class-certification orders, a denial of a summary-judgment motion based on immunity, or the granting or denial of a plea to the jurisdiction by a governmental unit, the appeal "also stays all other proceedings in the trial court pending resolution of that appeal."15 Regardless of whether a stay is in effect, a trial court may not act in a manner that impairs or interferes with the jurisdiction of the appellate court.16

8-1:5 Orders and Judgments That May Not Be Stayed

Execution of the following judgments may not be stayed:

• orders denying interlocutory relief; 17
• appointment of receivers in a shareholder-derivative suit; 18
• child support or custody orders, unless the trial court orders otherwise; 19
• suspension of a license to practice law; 20 and
• final judgments of a district court regarding an order of the Texas Alcoholic Beverage Commissioner "refusing, cancelling, or suspending a permit or license." 21

8-1:6 Pending Appeal

Only judgments or appealable orders that are the subject of an actual pending appeal may be superseded. But the mere filing of a notice of appeal does not suspend enforcement of a judgment.22 If an appeal is not perfected during the time period for perfecting an appeal, enforcement of a judgment may not be stayed. Therefore, if the unsuccessful party does not perfect an appeal, the judgment may not be superseded. And once all appellate remedies have been exhausted, the judgment can no longer be superseded.

8-1:7 Time to Supersede

A judgment debtor is not required to supersede a judgment at any particular time. Nevertheless, to avoid execution on the judgment, the judgment debtor should file the security promptly. The timing of the filing of the security is largely dictated by the timetable for execution. The time when a party may begin efforts to collect (but not actually execute) on the judgment—such as garnishment and turnover proceedings—and hence the deadline for suspending these efforts begins to run when the trial court signs a final and appealable judgment.23 A judgment creditor may not actually execute on a final judgment until 30 days after it is signed, or 30 days after a timely motion for new trial is overruled.24 However, a timely filed motion to modify the judgment, alone, does not extend the date on which a party may execute on the judgment.

To avoid a potential writ of garnishment, the judgment debtor should file the security to suspend execution on the judgment immediately after it is rendered. A plaintiff may obtain a writ of garnishment immediately after the judgment is signed unless a proper supersedeas bond is filed.25 Also, in some cases a turnover order may be issued immediately after the judgment is signed.26 Lastly, the judgment debtor may wish to supersede the judgment immediately in order to prevent post-judgment discovery.

8-1:8 Actions Not Stayed by a Properly Superseded Judgment

8-1:8.1 Abstract of Judgment

Not all actions by the judgment creditor regarding possible future enforcement of the judgment are precluded by the posting of proper security. For example, the successful party may record an abstract of judgment in the deed records of any county in which the judgment debtor has property even if the judgment is superseded, unless prohibited by court order.27 The filing of the abstract does not constitute an enforceable lien on the real property if enforcement is stayed.

The lien will nonetheless remain unless:

• the defendant has posted proper security; and
• "the trial court finds that the creation of a lien would not substantially increase the degree to which the judgment creditor's recovery under the judgment would be secured when balanced against the costs to the defendant after the exhaustion of all appellate remedies." 28

A certified copy of the court's finding must be recorded in the real-property records in each county in which the abstracted judgment or certified copy of the judgment has been filed.29 A lien on personal property of the judgment debtor is improper after the judgment is superseded.30

8-1:8.2 Injunction to Prevent Dissipation of Assets

Even when a judgment debtor posts security in the maximum amount required, a judgment creditor may seek and obtain an injunction against the judgment debtor from dissipating or transferring assets to avoid satisfaction of the judgment.31 And the judgment debtor may pursue post-judgment discovery related to such an injunction.32

8-1:8.3 Discovery Regarding the Security

Although all parties may conduct discovery any time after final judgment to obtain information regarding collection—such as discovering assets of the judgment debtor—or security on appeal, the prevailing party may not conduct post-judgment discovery to aid collection after the judgment is superseded.33 But post-judgment discovery is permissible during the pendency of the appeal to determine whether the posted security continues to be sufficient to protect the judgment creditor, or when the discovery relates to certain motions allowed under the appellate rules.34 Sometimes circumstances arise that require modification of the amount or method of security, and that determination may be a factual inquiry necessitating discovery. Discovery also is permitted after supersedeas to discover the net worth of the judgment debtor when the amount of security posted is based on net worth.35

8-2 Amount of Security

8-2:1 Money Judgment

The trial court clerk has the ministerial duty to approve the bond or deposit, including the amount. The amount of security for a money judgment must cover:

• the amount of compensatory—but not punitive—damages;
• interest for the estimated duration of the appeal, and costs. 36

The "interest" that must be included in the amount of security is interest only on the compensatory damages that are being superseded—interest on the sums that do not have to be superseded (such as punitive damages and non-compensatory attorney's fees) is not included.37

The amount of the bond cannot exceed the lesser of:

• 50% of the debtor's current net worth; or
• $25 million. 38

8-2:2 "Compensatory Damages"

"Compensatory damages" are commonly defined as "damages sufficient in amount to indemnify the injured person for the loss suffered."39 This phrase is interchangeable with "actual damages," which is defined as "[a]n amount awarded to a complainant to compensate for a proven injury or loss; damages that repay actual losses."40

8-2:2.1 Pre-judgment Interest

These definitions do not...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT