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c. Replevy by the DebtorThe Debtor may defeat the Writ of Sequestration by filing its own Replevy Bond.Commercial Securities Co. v. Thompson, 239 S.W.2d 911, 914 (Tex. Civ. App.—Fort Worth1951, no writ). A Replevy Bond may be filed anytime before judgment if the property has notbeen previously claimed, replevied or sold. Tex. R. Civ. P. 701. The Debtor must give a bond,with sufficient surety or sureties, as provided by statute, to be approved by the clerk, payable tothe Creditor, in an amount fixed by the Court's Order. Id. Either party shall have a right to havethe amount of the bond increased or decreased. Id. The purpose of the Debtor's Replevy Bondis to ensure that the property will be forthcoming after judgment in the same condition as whenreplevied. Commercial Securities Co. v. Thompson, 239 S.W.2d 911, 914 (Tex. Civ. App.—FortWorth 1951, no writ). If the property seized is personal property, then the bond shall requirethat the Debtor not remove the property out of the county or that it will not waste, ill-treat, injure,destroy, or dispose of the property, and that the Debtor will have such property, in the samecondition as when it as replevied, together with the value of the fruits, hire or revenue thereof, toabide by the decision of the Court or that the Debtor will pay the value thereof, or the differencebetween the value at the time of the replevy and the time of judgment and of the fruits, hire orrevenue of the same, if ordered to do so. Tex. R. Civ. P. 702. The wording of this rule requiringthat the Debtor have the property in the same condition as when it was replevied, excludes anyordinary depreciation in market value. Associates Inv. Co. v. Soltes, 250 S.W.2d 593, 595 (Tex.Civ. App.—Dallas 1952, writ ref'd n.r.e.). The language that the Debtor will pay the differencebetween the value at the time of replevy and at the time of judgment refers to damagesoccasioned by the ordinary use. Id. If the property is real estate, the bond shall require that theDebtor not injure the property and that the Debtor will pay the value of the rents of the same, ifhe is ordered to do so. Tex. R. Civ. P. 703.If the Debtor has filed a Replevy Bond, the Order dissolving the Writ vacates theReplevy Bond and discharges the sureties. Tex. R. Civ. P. 172a.If the levying officer receives notice of filing of a Replevy Bond within 10 days after thelevy, and the Creditor does not timely object to the bond, the officer must re-deliver the propertyto the Debtor upon receipt of the fees and necessary expenses for safeguarding the property,including pick up and storage costs. Tex. R. Civ. P. 708.There is a conflict in the law as to whether or not a Debtor who replevies may be liablefor the fruits, hire or revenue of the property. Civ. Prac. & Rem. Code § 62.046 provides that aDebtor who replevies the property is not required to account for the fruits, hire, revenue, or rentof the property. However, Tex. R. Civ. P. 702 provides that the Replevy Bond be in an amountthat includes the value of the fruits, hire or revenue thereof. Currently there is no case lawresolving this conflict.11. Replevy by the CreditorIf the Debtor has not replevied the property within 10 days after execution of the Writ ofSequestration and service of notice on the Debtor, a Creditor may file a Replevy Bond in anamount fixed by the Court's Order. Tex. R. Civ. P. 708. Upon filing of the bond, the officer mustgive possession of the property to the Creditor. Id. For personal property, the bond mustrequire that the Creditor have the property, in the same condition as when it was replevied,together with the value of the fruits, hire, or revenue thereof, forthcoming to abide the decisionof the Court, or that it will pay the value thereof, or the difference between its value at the time ofreplevy and at the time of judgment (regardless of the cause of such difference in value, and ofthe fruits, hire or revenue of the same in case it should be ordered to do so). Id. For realPage 22 of 36
property, the bond must require that the Creditor will not injure the property and that it will paythe value of the rents of the same in case it is ordered to do so.The language in the Sequestration Bond (Tex. R. Civ. P. 698) may be combined with thelanguage for the Replevy Bond (Tex. R. Civ. P. 708). Although the Sequestration Bond requiredby Rule 698 and the Replevy Bond required by Rule 708 serve two different purposes and areconditioned against different contingencies, the two may be combined in the same bond. Kelfov. Hanson, 388 S.W.2d 396, 399 (Tex. 1965). It is normally advisable to combine the languagerequired by Rule 698 with the language required by Rule 708. This will expedite the process ifthe Creditor seeks possession of property prior to final judgment.12. Disposition of the PropertyNon-Judicial ForeclosureThe case law is not clear on whether or not a secured creditor who has obtainedproperty through a Writ of Sequestration and the posting of a Replevy Bond may institute a nonjudicialforeclosure. In Moszkowicz v. A. B. Lewis Co., 268 S.W.2d 548, 551 (Tex. Civ. App.—Waco 1954, writ ref'd n.r.e.), the Court held that the filing of a suit to foreclose a security interestand applying for a Writ of Sequestration is an election of remedies against non-judicialforeclosure. However, in Unicut, Inc. v. Texas Commerce Bank-Chemical, 704 S.W.2d 442,445 (Tex. App.—Houston [14 th Dist.] 1986, writ ref'd n.r.e.), the Court held that a secured partymay sue for possession of collateral and seek a Writ of Sequestration in support thereof andthereafter hold a private foreclosure sale.Judicial ForeclosureNormally, the property will be delivered to the party that prevails in the underlyingdispute upon a final judgment for that party. However, where the property is the type that willlikely be wasted or destroyed, or greatly deteriorate in value and a Replevy Bond has not beenfiled, the Court may order the seized property sold and the proceeds deposited with the Court.Tex. R. Civ. P. 710. Although the title to this rule references “perishable goods,” a reading ofthe Rule indicates that it applies in virtually every case sequestered property. This Rule appliesto property that will decline rapidly in value given its age, or model, or general movement in thatparticular market. Assuming that the property qualifies under the broad definition in this Ruleand Debtor has failed to post Replevy Bond within 10 days from execution of the Writ, eitherparty may file a motion to sell the property as a perishable good. Id. A competent witness’declaration or affidavit showing why the property should be sold should accompany theapplication. Id. If the levying officer certified the truth of the affidavit, the Court must order thesale of the property. Id. The Order must direct the officer having the property in his possessionto sell it in the same manner as under execution. Tex. R. Civ. P. 711. Within 5 days aftermaking the sale, the officer shall return the Order of the sale to the Court and pay over to theclerk the proceeds of the sale. Tex. R. Civ. P. 712.When property that has been levied upon is claimed by a third party, that party's claimshould be adjudicated through a trial of right of property (See Tex. R. Civ. P. 717-734).C. ATTACHMENT1. OverviewAttachment is the least used of the three significant pre-judgment remedies. AnAttachment allows a Creditor holding a secured or unsecured claim to create a judicial lien on aPage 23 of 36
Page 1 and 2: PREJUDGEMENTREMEDIES IN TEXASPresen
Page 3 and 4: TABLE OF CONTENTS(continued)Page5.
Page 5 and 6: I. INTRODUCTIONA. OVERVIEWPrejudgme
Page 7 and 8: B. If the Debtor is an individual,
Page 9 and 10: intellectual property or causes of
Page 11 and 12: parties in a garnishment action. Ja
Page 13 and 14: . Hearing on the ApplicationIt is n
Page 15 and 16: may be liable for exemplary damages
Page 17 and 18: The Debtor may also petition the Co
Page 19 and 20: posting a replevy bond. While the p
Page 21 and 22: Like the application, the affidavit
Page 23 and 24: type and in a manner calculated to
Page 25: Debtor may simply chose to ignore t
Page 29 and 30: itself. S.R.S. World Wheels, Inc. v
Page 31 and 32: of Court. Id. The Order granting th
Page 33 and 34: 9. Debtor’s Response to the Writ
Page 35 and 36: IV.OTHER POSSIBLE REMEDIESA full de
Page 37 and 38: Debtor. In such cases, the Garnishe
Page 39 and 40: Due to the fact that a bond is requ

Prejudgment Remedies in Texas - Doug D'Arche - Back to Main Page

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