Staying Enforcement of a Judgment Pending Appeal, 0519 COBJ, Vol. 48, No. 5 Pg. 30

PositionVol. 48, 5 [Page 30]

48 Colo.Law. 30

Staying Enforcement of a Judgment Pending Appeal

Vol. 48, No. 5 [Page 30]

Colorado Lawyer

May, 2019



Obtaining a stay of execution on an adverse judgment may be critical to preserving a party's rights, financial interests, and freedoms while pursuing an appeal. This article outlines the procedures for seeking a stay of enforcement of various types of judgments pending an appeal.

Many lawyers may not be aware that taking an appeal does not automatically stay enforcement of a judgment pending the appeal. Although filing an appeal usually divests the trial court of jurisdiction over the matters at issue on appeal, it does not prevent the trial court from exercising jurisdiction to enforce the judgment. Thus, for instance, absent a stay, a judgment creditor may enforce a civil judgment—and the trial court may enter orders supporting that enforcement—regardless of any pending appeal.1 The trial court also retains jurisdiction to entertain stay motions and related issues even as an appeal is pending.2

A stay is not required as a condition to pursuing an appeal3 (although civil appellants may be required to post a cost bond as security for the payment of anticipated appeal costs4 ). Yet in some cases, failing to stay enforcement of a judgment could potentially moot the appeal.5 Moreover, if an appealing party pays a money judgment rather than obtaining a stay, that party may not be able to recuperate the funds paid, even if it succeeds in overturning the judgment on appeal, if the recipient has become insolvent or otherwise makes recovery difficult. Likewise, a party who appeals an injunctive order without obtaining a stay could find that the status quo has changed or could suffer other irreparable harm during the pendency of the appeal that might ultimately undermine any relief he or she seeks to gain through the appeal. And a criminal defendant could potentially serve much or all of a prison sentence, only to have that sentence reversed or reduced on appeal.

Therefore, for any type of case, as soon as a judgment is entered counsel should consider whether and how to try to secure a stay pending post-trial motions and a potential appeal. This article outlines those procedures for various kinds of civil, criminal, and administrative actions in Colorado state and federal courts.

Staying a Civil Judgment

Stays of enforcement of civil judgments are generally governed by Rule 62 of the applicable civil rules, Rule 8 of the applicable appellate rules, and additional local rules. For some types of orders, such as injunctive orders or property division orders in a domestic case, case law sets forth additional standards for stay requests.

The Automatic Stay

In Colorado state courts, most civil judgments are automatically stayed for 14 days after entry of the judgment.[6] In federal courts, the automatic stay period was recently extended from 14 days to 30 days—which is the length of time parties in most cases (where the United States is not a party) have to file a notice of appeal.7 However, the automatic stay does not apply to state or federal judgments in injunction or receivership actions, or to federal judgments directing an accounting for patent infringement.[8] It also does not apply to other categories of orders not included within the scope of the rule.9

The newly amended Fed.R.Civ.P. 62 expressly permits a court to dissolve the automatic stay or to supersede it with a court-ordered stay.10The corresponding state rule does not include a similar provision, suggesting that state courts may lack authority to dissolve or modify the automatic stay during the 14-day period following entry of judgment.

During the duration of the automatic stay, the prevailing party cannot take any actions to enforce the judgment. This gives the other party a brief period to consider whether to file a post-trial motion or appeal and, if so, to seek a stay and to obtain a bond if one is likely to be necessary.

Stays Before an Appeal

Because the automatic stay period ends quickly, particularly in state court, counsel should be prepared to file a stay motion (and potentially an accompanying motion for a stay pending the court's ruling on the substantive stay motion) as quickly as possible—and before expiration of the automatic stay, if at all possible. This may mean filing a stay motion in the trial court before filing an appeal, or even before deciding whether to take an appeal.

Notably, the filing of post-trial motions does not, by itself, stay enforcement of the judgment.11 Parties instead must seek any requested stay while such motions are pending.

The Colorado Rules of Civil Procedure provide for discretionary stays pending the deadline for filing an appeal, the disposition of post-trial motions filed under Rules 59 or 60, and the disposition of a motion for approval of a supersedeas bond.12 The federal rules more broadly provide for stays "[a]t any time after judgment is entered."13 In both state and federal courts, trial courts have discretion to determine whether to issue a stay and, if so, what bond requirements to impose as a condition for the stay.14

Staying a Monetary Judgment

In most cases, a judgment creditor can obtain a stay of execution on a money judgment by filing a supersedeas bond or other form of security in an amount and upon terms set by the trial court.15 The purpose of the security is to "protect[] the appellee's interests in the judgment"16and "secure[] the judgment against insolvency of the judgment debtor" while the appeal is pending.17 The stay is effective when the bond or other security is filed and approved by the court.18

In Colorado state courts, the presumptive amount of a supersedeas bond is 125% of the total amount of the judgment, including any prejudgment interest, costs, and attorney fees awarded by the court, although a court may order or an applicable statute may provide for a different amount.19 Supersedeas bonds are statutorily capped at $25 million collectively for all appellants in a single action, unless an appellee shows that an appellant is intentionally dissipating or diverting assets to avoid payment of the judgment.20

In state courts, three different forms of bond are automatically effective when filed with the district court clerk in the presumptive amount or any different amount set by court order or statute: (1) a cash bond; (2) a certificate of deposit issued by a U.S.- or Colorado-chartered bank; and (3) a corporate surety bond issued by a surety authorized to do business in the state.21 Other forms of secured bonds, including letters of credit by a U.S. - or Colorado-chartered bank or property bonds, also maybe effective, but only upon entry of an order approving the bond.22 Any party who objects to a bond—including one that is automatic upon filing or one that is proposed—must file an objection within 14 days of service of the bond or proposed bond.23

In federal courts, the rules do not establish a presumptive amount of a bond. The Tenth Circuit has recognized that a bond "is usually for the full amount of the judgment, though the district court has discretion in setting the amount."24 In practice, a bond usually includes not only the amount of the judgment but also post-judgment interest for the anticipated duration of the appeal.

Although requiring a bond or other security is typical in both state and federal courts, in rare instances a court might waive a bond requirement (although a state court's discretion to waive the bond requirement entirely remains unclear) or might order a bond for less than the presumptive amount.25 Additionally, governmental entities and officials generally cannot be required to post a bond. The state, counties, municipalities, and their officers and agencies acting in an official capacity need not file a bond in a state court action unless ordered to do so by the court.26 Federal courts cannot require the filing of a bond or other security by the United States, its officers, or its agencies in any appeal taken or directed by a department of the federal government.27 Finally, while CRCP 62 does not expressly address this point, C.A.R. 8(c) permits an appellate court, in its discretion, to dispense with or limit the amount of a bond when the appellant is an executor, administrator, conservator, or guardian of an estate and has posted a bond in that capacity.[28]

Where a bond is required, parties can work with an insurance broker, bank, or surety to obtain a bond or to get answers to specific questions regarding different bond options.29

Staying an Injunctive Order

Courts have far broader discretion in considering stay requests related to non monetary judgments, such as judgments ordering or denying an injunction, than for requests related to monetary judgments.30

A state court may not enter a stay of an interlocutory or final judgment in an injunctive or receivership action.31 However, the trial courts in both state and federal courts have discretion to suspend, modify, restore, or grant an injunction during the pendency of an appeal upon such terms for a bond that t he court determines are proper to secure the adverse party's rights.32

In both state and federal proceedings, courts will generally consider four factors in determining whether to stay an order granting or denying an injunction: (1) whether die stay applicant has shown a strong likelihood of success on die merits; (2) whether die applicant will be irreparably injured absent a stay; (3) whether issuance of a stay will substantially injure other parties interested in die proceeding; and (4) where die public interest lies.33

Some federal courts, including die Tenth Circuit, have held that if die movant...

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