What Is A Replevin Bond?
A Replevin Bond (aka Claim & Deliver Bond) is a type of surety bond utilized by a plaintiff in a civil case. The Replevin Bond allows the plaintiff to take physical possession of assets in question before the court begins the trial.
By utilizing a Replevin Bond, the defendant has the assurance that they will receive their property back intact if the court finds in their favor. The Replevin Bond protects the defendant and guarantees good stewardship of the assets (by the plaintiff) until the court decides if the property should be returned to the defendant or not.
Note: The counterpart to the Replevin Bond is the Counter Replevin Bond that allows the defendant to keep possession of the property.
What documents are required to obtain a Replevin Bond?
1) Copy of Complaint
2) Copy of final Court Order that approves the bond.
3) Completed Application
4) Financial Statement (only necessary if you're attempting to get the bond approved without collateral).
5) If collateral is required, then a Collateral Agreement.
Do I need collateral to obtain a Replevin Bond?
It depends. The bottom line is that the surety will evaluate your financial capacity to pay the full amount of the bond. The surety bond company will typically review your credit report and financial statements.
How Much Does a Replevin Bond Cost?
As a rule of thumb, bonds that are fully collateralized receive a premium of 1% of the full bond amount. Bonds are not fully collateralized will be more expensive.
To get a full quotation and understanding of Replevin Bond, call Surety Bond Authority at 800-333-7800, and our friendly and competent staff will be happy to assist you. You can also email us to get a free quote.
How does a Replevin Bond work?
A plaintiff can post a Replevin Bond to demand the return of property or properties held by the defendant before the start of the trial. It allows the defendant to take legal custody of the property even before the court sets a date for the trial. This is called replevin action (or simply replevin). But attachment and replevin are two different things regarding ownership of the property in question.
In an attachment, the property belongs to the defendant that the plaintiff wants to be secured for future judgment. In replevin action, the plaintiff is claiming ownership of the property that is the procession of the defendant.
But before a plaintiff can demand the seizure of the property from the defendant, the court will require him or her to obtain a Replevin Bond. In this case, the Principal is the plaintiff, and the Obligee is the court.
However, the Replevin Bond also guarantees that if the court rules in favor of the defendant, the plaintiff is mandated to return the property to the defendant in the same condition as when it was received. If the plaintiff refuses to return the property, then they must pay the defendant the full monetary value of the property. The plaintiff must also compensate the defendant for any damages incurred as a result of the lawsuit. The same will happen if the plaintiff has disposed of the property.
In what instances does the court require a Replevin Bond?
The courts typically require Replevin Bonds in lawsuits involving conditional sales contracts, including the sale of goods under an installment plan. Under the terms of most of these types of contracts, the seller retains legal title to the property until the buyer completes payment. The seller claims title to the property through a perfected security interest that is created when it files with the designated government office a financing statement that summarizes the sales contract. A perfected security interest acts as a legal notice that the seller has title to the property and claims superior interest over the buyer’s other creditors.
Surety underwriters prefer to write Replevin Bonds with confirmation that the applicant has a perfected security interest in the goods. The buyer’s interest or title is often called an equitable interest or equitable title until the buyer pays for the goods.
Examples of Replevin Bond
James and Clark have formed a trucking business. James used his truck as his capital while Clark offered his real estate property as his share of the partnership. However, after several months, the company went out of business, and the partnership was dissolved. However, when James left the truck in the property of Clark but he believes the truck still belongs to him as he was its owner. But James believes that the truck is now his property because he has unpaid salaries from the partnership and refuses to return the truck to Clark.
Before filing his lawsuit, James obtains a Replevin Bond from a surety firm that gives him the authority to retrieve the truck from Clark even before the case begins for trial. However, while the litigation is still pending, James cannot sell or dispose of the truck. He should also make an effort to keep the truck in the same conditions as when he took procession of it.
Anna and Carlos were married for ten years. However, the couple filed for divorce citing irreconcilable differences. When Carlos moved out of their apartment, he left some of his electronic gadgets, including his 50-inch Smart TV. But Anna said she owns the TV and will not let Carlos get it.
To get his TV at the soonest possible time, Carlos must get Replevin Bond from a surety firm before even filing a lawsuit. This will allow him to take procession of the Smart TV before the start of the litigation. But Carlos must keep the TV in the same condition as when he received it, and he is also prevented from selling or disposing of the TV until after the court renders a final decision.
In both cases, only two things will happen. Either the court rules for the plaintiffs and James and Carlos can keep their truck and TV respectively, or the court will rule for Clark and Ana have the truck, and the TV returned to them.
In the second scenario, Clark and Ana can file a claim against the Replevin Bond if James and Carlos returned the truck and the TV in a worse condition when they received the items. The surety firm will them ask James and Carlos for reimbursement for the money they paid to the defendants.
About Surety Bond Authority
Surety Bond Authority is a full-service surety bond company that is built on a foundation of integrity. As a reputable partner for all your surety bond needs, Surety Bond Authority prides itself on stellar customer service and affordable rates.
Backed by twenty-five years of experience, Greg Rynerson, CEO, and Founder of Surety Bond Authority has spent his career in the surety bond and insurance industries. Throughout the course of his professional life, Greg has been proud to execute bonds at the state and federal level for his clients.