Rule 3.604.Bonds

MCR 3.604 is the general bond rule. Subrule (A) applies it to bonds given under the Michigan Court Rules and the Revised Judicature Act unless a rule or statute clearly calls for a different procedure. Its effect is to make a bond enforceable inside the case that produced it.

The surety comes into the case

Subrule (B) is the hinge. A surety on a bond or undertaking given under the court rules or the Revised Judicature Act submits to the court's jurisdiction and consents that further proceedings affecting the surety's liability may be conducted under this rule. Subrule (C) adds a substitution requirement: if the only plaintiff or the only defendant dies during the action, each surety on a bond given by that party is made a party, on notice under MCR 2.107, in addition to the parties substituted under MCR 2.202.

Proving the surety is good for it

Subrule (D)(1) requires a surety other than a surety company authorized to do business in Michigan to execute an affidavit of pecuniary responsibility and attach it to the bond. Subrule (D)(2) sets the measure: assets not exempt from execution with a fair market value exceeding the surety's liabilities by at least twice the amount of the bond. A copy of the bond and affidavit must be promptly served on the party for whose benefit it was given under MCR 2.107, with proof of service promptly filed. In a medical malpractice action filed on or after October 1, 1986, subrule (D)(4) routes notice of the filing of security for costs, or of the affidavit in lieu of that security, required by MCL 600.2912d and MCL 600.2912e, through MCR 2.109(B). Under subrule (G), a surety company certified by the Commissioner of Insurance as authorized to do business in Michigan may act as surety on a bond.

Objecting to a surety

Subrule (E) gives the party for whose benefit the bond is given 7 days after receipt of a copy to serve a notice objecting to the sufficiency of the surety on the officer taking the bond and the party giving it. Failure to do so waives all objections to the surety. Subrule (F) turns that notice into a motion. On the objecting party's demand, the surety must appear at the hearing and submit to examination on pecuniary responsibility or the validity of the execution of the bond, and the court may then approve or reject the bond or require an amended, substitute, or additional bond. Subrule (F)(3) addresses an objection in an appeal to the circuit court from a lower court or tribunal.

Enforcement and relief

• Subrule (H): when the condition of a bond is broken, or the circumstances require, the court directs delivery or assignment of the bond for prosecution to the person it benefits, and enforcement proceedings may be taken in the action under subrule (I).
• Subrule (I)(1): judgment may be entered directly against the surety or the security on motion, without an independent action, on a showing that the condition giving rise to liability or forfeiture has occurred.
• Subrule (I)(3): if later proceedings show the surety is not liable or that the security should not have been forfeited, the court may order restitution.
• Subrule (L): where a party required to give a bond for supersedeas, appeal, or otherwise is unable to give it by reason of poverty, the court may, on proof of the inability, limit or eliminate the requirement for surety on appropriate conditions and for a reasonable time.

Subrule (J) blocks judge shopping. Once a circuit judge has denied an application for supersedeas in whole or in part, or granted it conditionally or on terms, a later application for the same purpose in the same matter may not be made to another circuit judge while the first is available. An order entered contrary to that provision is void, must be revoked by the judge who entered it, and exposes the applicant to punishment for contempt.