A Bondsman, a Surety, and the People Walk into the Court of Appeal . . .

People v. Am. Surety Co., No. E067831 (D4d2 Jan. 15, 2019)

Under Code of Civil Procedure § 917.1, by posting an undertaking, a party can stay the enforcement of a money judgment pending appeal. If the judgment is affirmed and the defendant fails to satisfy, the surety pays the judgment and then becomes, in effect, the judgment creditor. But § 917.1 only applies to an appeal of a money judgment. 

Here, a summary judgment was entered requiring a Bondsman to forfeit a bail bond. Bondsman didn’t immediately appeal the judgment. Instead, it moved to vacate the judgment. When that was denied, Bondsman appealed the denial of the motion to vacate, but apparently not the judgment itself. 

The next day, Bondsman posted an undertaking, backed by Surety, appearing to stay the case. The Court of Appeal affirmed the forfeiture. But just a few days before the remittitur was to issue, Surety moved to exonerate the undertaking, arguing that because Bondsman appealed the denial of the motion to vacate, and not the judgment, § 917.1 was inapplicable, and thus the undertaking invalid. The trial court denied the motion and the Surety appealed. 

On the merits, the undertaking was, in fact, invalid. Section 917.1 does not apply to an appeal of a denial of a motion to vacate. As post-judgment ruling that doesn’t itself award any money, that ruling is automatically stayed under § 916(a). But that stay is not worth much because it doesn’t reach back to stay enforcement of the underlying judgment. To do so, Bondsman’s only remedy in these circumstances was to petition the Court of Appeal for a writ of supersedeas.

Ironically, Bondsman could have avoided this whole problem with a small tweak to its notice of appeal in the forfeiture case. In 2017, the Supreme Court held that the denial of a motion to vacate is an appealable order under § 904.1(a)(2) as an “order made after” an appealable judgment. Ryan v. Rosenfeld, 3 Cal. 5th 124, 135 (2017). But filing a motion to vacate also automatically extended the time for Bondsman to appeal the underlying forfeiture judgment. Cal. R. Ct. 8.108(c). So all Bondsman needed to do to avoid this whole issue was to include the judgment as an additional object of this appeal in the notice. 

Also, because the Plaintiff in the bail forfeiture case is the state, Bondsman was required to get court approval before posting an undertaking. §§ 995.810, 995.840(a). It did not do that, so the undertaking was invalid for a second reason. 

Anyway, notwithstanding the invalidity, the Court isn’t going to let Surety off the hook. Surety did not raise the validity issue until nearly two months after the Court of Appeal issued a decision on the bail forfeiture case. By that time—with a remittitur due in just six days—Surety’s obligation to pay was essentially inevitable. Given Surety’s delay and the fact that the People relied on the undertaking to afford a de facto stay on execution, Surety is barred from challenging the undertaking at this point of the case. Either it forfeited the right or it is estopped from raising it.

Affirmed