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Appeal Bonds: A Litigation Unicorn

In Massachusetts (and United States, generally), civil litigants are responsible for paying their own legal fees. This concept is known as the "American Rule". It matters not that you were sued by your neighbor and did not want to be involved in a lawsuit; or that you felt compelled to bring suit against a developer as a last ditch effort to protect the character of your neighborhood. It also does not matter if you win. You are going to pay your legal fees. There are, as in all things in the legal world, some limited exceptions to the American Rule, and we will discuss those in another blog post.

This blog post is to discuss a little known and little used tool called an appeal bond, which can, potentially, help offset additional legal fees incurred on appeal. Once a litigant has been successful at the trial court level (Superior Court, Land Court, or Housing Court), an appeal bond can, in theory, be imposed upon the unsuccessful litigant's appeal of the trial court judgment to the Appeals Court. If the judgment is ultimately sustained on appeal, the appeal bond is then forfeited to the successful litigant, thereby offsetting the cost of defending the appeal (i.e., attorneys' fees), as well as other costs incurred during the pendency of appeal (such as increased financing, materials, and construction costs, lost rents and profits, etc.). The difficultly, as you might imagine, is getting the trial court to impose an appeal bond in the first place.

General Laws Chapter 231, Section 117, allows for post judgment relief pending appeals, as follows:

After an appeal has been taken from a final judgment of the superior court, the land court, [or] the housing court . . . the justice ... by whom the final judgment appealed from was made . . . may make any proper interlocutory orders, pending such appeal . . .

Though not expressly stated in the statute, in 1972 (under the predecessor statute to § 117) the Supreme Judicial Court held that a trial judge's authority over post judgment relief encompassed the discretion to impose an appeal bond. See Broderick v. Zoning Bd. of Appeal of Boston, 361 Mass. 472, 476 (1972) ("In appropriate circumstances after the entry of a final decree, a justice... may order, pending appeal, that a surety bond be filed by the appellant in an amount which is sufficient to protect the interests of the appellee and is otherwise appropriate."), citing the former G. L. c. 214, § 22, and Eastern Investment & Development Corp. v. Franks, 339 Mass. 280, 292-293 (1959).

Nevertheless, the standard for imposing an appeal bond is high. "[T]the countervailing considerations which are to guide judicial discretion in determining the amount of a bond are: (1) the objective of inhibiting frivolous and vexatious appeals..., versus (2) not unreasonably inhibiting meritorious appeals ..." Feldman v. Board of Appeal of Boston, 29 Mass. App. Ct. 296, 298 (1990), citing Damaskos v. Board of Appeal of Boston, 359 Mass. 55, 64 (1971). Convincing a trial judge - even on who just ruled in your favor - that an appeal is so "frivolous and vexatious" that it warrants the imposition of an appeal bond over the potential of "inhibiting [a] meritorious appeal" is a difficult task. Judgments entered by a trial court are rarely overturned on appeal. However, trial judges are inherently concerned about chilling a party's constitutional right to petition the courts for redress. The latter tends to outweigh the former. Moreover, even if an appellant is unsuccessful on appeal that does not per se mean that the appeal was otherwise frivolous and vexatious. Legitimate arguments are often raised on appeals that are ultimately rejected by the Appeals Court for one reason or another, without ever coming close to such a high standard as frivolousness. Thus, even the potential that a legitimate argument could be raised on appeal, tends to breed caution in trial judges when asked to impose an appeal bond.

Nevertheless, appeal bonds can be a powerful tool in the right circumstance, and can act to protect a party's pecuniary interests during the appellate phases of litigation.

Written by Robert K. Hopkins, Esq. on behalf of Jeffrey T. Angley, P.C

Copyright (c) 2011-2019 by Jeffrey T. Angley, P.C. All rights reserved.

Disclaimer: The information contained in this post is general in nature and for informational purposes only. No personal legal advice is being provided. If you have an actual legal issue that needs to be addressed, you should seek the advice of competent legal counsel. This post does not create an attorney-client relationship between the reader and Jeffrey T. Angley, P.C., Phillips & Angley or their attorneys.

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