MEMORANDUM DECISION
GORDON THOMPSON, Jr., Chief Judge.
This case requires the Court to determine the scope of a surety’s contractual obligations under a bail bond contract, a contract interpretation issue of great interest to criminal defendants, sureties, and the government.
I
Mike Tellez Banks was arrested and taken into custody on November 4, 1983 as he crossed the International Border at San Ysidro with heroin concealed in his 1972 Oldsmobile. At his initial appearance on November 7, 1983, Magistrate Curtis McKee set a cash or corporate surety bond in the amount of $100,000. On November 10, 1983, a five-count indictment was returned against defendant Banks, charging him with importation of heroin, possession of heroin with intent to distribute, illegal importation of monetary instruments, false statements, and interstate and foreign travel in aid of racketeering enterprises. Defendant was afforded a bail review on November 16, 1983 at which Magistrate McKee affirmed the $100,000 bond. A second bail review hearing was held on December 13, 1983 and the bond was re-affirmed by Magistrate McKee. On December 21, 1983, District Judge J. Lawrence Irving held another bail review hearing, •affirming the written findings of Magistrate McKee and the bond set at $100,000.
On January 18, 1984, upon the posting of the $100,000 bail bond by the surety Dependable Insurance Company, Inc. [Dependable], defendant Mike Tellez Banks was released from custody. The defendant made all his required appearances before the district court up to and including his stipulated facts court trial on April 5, 1984. Judge Irving found Mr. Banks guilty on all counts. Sentencing was set for May 25, 1984, and later continued until June 11.
Defendant appeared before Judge Irving for sentencing on June 11, 1984. At the conclusion of the sentencing, defense counsel asked the Court for a short extension (until the end of the day) to “file the notice of appeal and be able to do all the necessary paperwork downstairs to present and file this bond pending the appeal of this matter.” Judge Irving ordered defendant to appear for a status hearing on August 27, denied the government’s request to raise the bond pending appeal to $200,000, but did not explicitly exonerate the appearance bond executed by Dependable. Nor did he explicitly continue the appearance bond posted by Dependable as an appeal bond.
Events subsequent to the sentencing are somewhat unclear. What is clear, however, is that defendant Banks never obtained a separate appeals bond. Yet Mr. Banks did appear for status conferences before Judge Irving on August 27, 1984 and October 29, 1984. The Ninth Circuit later affirmed Banks’ conviction.
Notice of the hearing to file the certified copy of the Ninth Circuit’s affirmance was sent to defense counsel on April 18, 1985.
The date for filing the Ninth Circuit’s decision in the district court was set for May 13, 1985. That date arrived; unfortunately defendant didn’t. The government moved for forfeiture of the “appeal bond in this case” and the issuance of a bench warrant. Judge Irving granted both motions.
On July 12, 1985, the government moved for a default judgment on the forfeiture of the bond. Dependable responded by moving to set aside the forfeiture and exonerate the bond.
II
Dependable claims that the bond should not be forfeited because it was no longer in effect when defendant Banks failed to surrender into custody after his conviction was affirmed. Dependable’s argument is that the language of the bond only provided for Banks’ appearances before the trial court prior to appeal of the conviction. The government contends that the bond remained in effect throughout the appellate process.
The central task thus presented in this case is to determine the extent of obligation undertaken by the surety Dependable, a matter of contract interpretation. Collateral to this question is the effect, if any, of Judge Irving’s rulings regarding the bail bond at the June 11, 1984 sentencing.
To put this issue into the proper contextual framework, it is necessary to reiterate the basic principles of bail bonds. A bail bond is a contract between the government and the defendant and the surety. .
United States v. Lujan,
589 F.2d 436, 438 (9th Cir.1978);
United States v. Plechner,
577 F.2d 596, 598 (9th Cir.1978);
accord United States v. Martinez,
613 F.2d 473, 476 (3rd Cir.1980). As with any other contract, the liabilities of the parties under the contract depend upon the intention of the parties as evidenced by the wording of the contract.
United States v. Morales,
91 F.R.D. 169, 171 (D.P.R.1981).
The language of the bond contract is to be strictly construed in accordance with its terms.
United States v. Lujan,
589 F.2d 436, 438 (9th Cir.1978). The bond at issue here, labelled “Bond for Preliminary Appearance,” contained the following pertinent language:
The conditions of this bond are that ... the said defendant is to appear in the United States District Court for the Southern District of California in accordance with all orders and directions of the Court relating to appearance of the said defendant before said Court, or in any other United States District Court to which the case may be removed or transferred.
... If the defendant complies with all of the conditions of this bond and appears as ordered, then this bond is to be void, but if the defendant fails to perform these conditions, payment for the amount of the bond shall be due forthwith.
The government argues that the language providing that the defendant must appear in accordance with “all orders” evidences the parties’ intentions that the surety was to be responsible for defendant’s appearance in the district court after appeal. This Court believes, however, that in this particular case the parties’ intentions are better understood by examining what language, usually found in other bail bonds, was
not
included in this contract, and by examining the parties’ actions as evidence of their intentions.
Many courts have examined similar language from other bail bonds in an effort to determine the parties’ intentions as to the extent of the surety’s liability.
Although interpreting virtually identical language, the courts’ rulings have been diverse.
At least three other cases,
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MEMORANDUM DECISION
GORDON THOMPSON, Jr., Chief Judge.
This case requires the Court to determine the scope of a surety’s contractual obligations under a bail bond contract, a contract interpretation issue of great interest to criminal defendants, sureties, and the government.
I
Mike Tellez Banks was arrested and taken into custody on November 4, 1983 as he crossed the International Border at San Ysidro with heroin concealed in his 1972 Oldsmobile. At his initial appearance on November 7, 1983, Magistrate Curtis McKee set a cash or corporate surety bond in the amount of $100,000. On November 10, 1983, a five-count indictment was returned against defendant Banks, charging him with importation of heroin, possession of heroin with intent to distribute, illegal importation of monetary instruments, false statements, and interstate and foreign travel in aid of racketeering enterprises. Defendant was afforded a bail review on November 16, 1983 at which Magistrate McKee affirmed the $100,000 bond. A second bail review hearing was held on December 13, 1983 and the bond was re-affirmed by Magistrate McKee. On December 21, 1983, District Judge J. Lawrence Irving held another bail review hearing, •affirming the written findings of Magistrate McKee and the bond set at $100,000.
On January 18, 1984, upon the posting of the $100,000 bail bond by the surety Dependable Insurance Company, Inc. [Dependable], defendant Mike Tellez Banks was released from custody. The defendant made all his required appearances before the district court up to and including his stipulated facts court trial on April 5, 1984. Judge Irving found Mr. Banks guilty on all counts. Sentencing was set for May 25, 1984, and later continued until June 11.
Defendant appeared before Judge Irving for sentencing on June 11, 1984. At the conclusion of the sentencing, defense counsel asked the Court for a short extension (until the end of the day) to “file the notice of appeal and be able to do all the necessary paperwork downstairs to present and file this bond pending the appeal of this matter.” Judge Irving ordered defendant to appear for a status hearing on August 27, denied the government’s request to raise the bond pending appeal to $200,000, but did not explicitly exonerate the appearance bond executed by Dependable. Nor did he explicitly continue the appearance bond posted by Dependable as an appeal bond.
Events subsequent to the sentencing are somewhat unclear. What is clear, however, is that defendant Banks never obtained a separate appeals bond. Yet Mr. Banks did appear for status conferences before Judge Irving on August 27, 1984 and October 29, 1984. The Ninth Circuit later affirmed Banks’ conviction.
Notice of the hearing to file the certified copy of the Ninth Circuit’s affirmance was sent to defense counsel on April 18, 1985.
The date for filing the Ninth Circuit’s decision in the district court was set for May 13, 1985. That date arrived; unfortunately defendant didn’t. The government moved for forfeiture of the “appeal bond in this case” and the issuance of a bench warrant. Judge Irving granted both motions.
On July 12, 1985, the government moved for a default judgment on the forfeiture of the bond. Dependable responded by moving to set aside the forfeiture and exonerate the bond.
II
Dependable claims that the bond should not be forfeited because it was no longer in effect when defendant Banks failed to surrender into custody after his conviction was affirmed. Dependable’s argument is that the language of the bond only provided for Banks’ appearances before the trial court prior to appeal of the conviction. The government contends that the bond remained in effect throughout the appellate process.
The central task thus presented in this case is to determine the extent of obligation undertaken by the surety Dependable, a matter of contract interpretation. Collateral to this question is the effect, if any, of Judge Irving’s rulings regarding the bail bond at the June 11, 1984 sentencing.
To put this issue into the proper contextual framework, it is necessary to reiterate the basic principles of bail bonds. A bail bond is a contract between the government and the defendant and the surety. .
United States v. Lujan,
589 F.2d 436, 438 (9th Cir.1978);
United States v. Plechner,
577 F.2d 596, 598 (9th Cir.1978);
accord United States v. Martinez,
613 F.2d 473, 476 (3rd Cir.1980). As with any other contract, the liabilities of the parties under the contract depend upon the intention of the parties as evidenced by the wording of the contract.
United States v. Morales,
91 F.R.D. 169, 171 (D.P.R.1981).
The language of the bond contract is to be strictly construed in accordance with its terms.
United States v. Lujan,
589 F.2d 436, 438 (9th Cir.1978). The bond at issue here, labelled “Bond for Preliminary Appearance,” contained the following pertinent language:
The conditions of this bond are that ... the said defendant is to appear in the United States District Court for the Southern District of California in accordance with all orders and directions of the Court relating to appearance of the said defendant before said Court, or in any other United States District Court to which the case may be removed or transferred.
... If the defendant complies with all of the conditions of this bond and appears as ordered, then this bond is to be void, but if the defendant fails to perform these conditions, payment for the amount of the bond shall be due forthwith.
The government argues that the language providing that the defendant must appear in accordance with “all orders” evidences the parties’ intentions that the surety was to be responsible for defendant’s appearance in the district court after appeal. This Court believes, however, that in this particular case the parties’ intentions are better understood by examining what language, usually found in other bail bonds, was
not
included in this contract, and by examining the parties’ actions as evidence of their intentions.
Many courts have examined similar language from other bail bonds in an effort to determine the parties’ intentions as to the extent of the surety’s liability.
Although interpreting virtually identical language, the courts’ rulings have been diverse.
At least three other cases,
United States v. Martinez,
613 F.2d 473 (3rd Cir.1980),
United States v. Catino,
562 F.2d 1 (2d Cir.1977), and
United States v. Dinneen,
577 F.2d 919 (5th Cir.1978), presented the same factual pattern as before the Court in this case: Defendant failed to appear for execution of sentence after his conviction was affirmed on appeal. In each case, defendant had not obtained an appeal bond separate from the appearance bond. Unlike the bond executed by Dependable, however, all of the bonds in these cases contained the provision that the bond was a “continuing bond” remaining in “full force and effect until exoneration.” In addition, each of these bonds provided as a condition that the defendant would “surrender for execution of sentence.” In
Martinez
and
Catino,
the Third and Second Circuits held that this language evidenced the parties’ intent that the bond remain in effect throughout the appeal. In
Dinneen,
the Fifth Circuit concluded that this language only made the surety liable during brief, reasonable stays of execution and not for a
failure to surrender after affirmance of conviction on appeal.
The principal Ninth Circuit case addressing the interpretation of a bail bond contract is
United States v. Gonware,
415 F.2d 82 (9th Cir.1969). In that case, the trial court stayed the execution of defendant’s sentence for approximately two days. When the defendant failed to appear two days later, the government moved to forfeit the defendant’s bail. The bond provided for the defendant to appear in court “in accordance with all orders” or “wherever prosecution may be ordered.” The court recognized that the bond did not expressly address the subject of stays of execution of sentence but concluded nonetheless that the parties intended the surety to remain liable during a short stay of execution of sentence. Key to the court’s conclusion was its interpretation of “prosecution” as continuing until the date defendant begins serving his sentence. The Ninth Circuit also noted that its conclusion was reasonable in light of the widespread and common practice of the courts in granting short stays to allow defendants to get their affairs in order before serving their sentence.
To a certain degree, all of the bail bonds in these cases contained similar language.
All contained provisions that the defendant agreed to obey all court orders relating to appearance. This very basic provision is the essence of a bail bond contract — to guarantee appearance by the defendant. The bonds held to be in effect during or after appeal, however, also contained provisions relating to the bond’s continuing nature and/or specifically requiring the defendant to surrender for execution of sentence.
By contrast, the language of the bond entered into by Banks and Dependable was distinctively different. Dependable’s bond was entirely silent as to whether the bond was a “continuing bond.” Neither does the bond contain any language about the bond continuing in full force and effect until exonerated by the court. Instead, the contract specifically provides that the bond would become void when the defendant complied with the conditions by appearing as ordered.
Based on this explicit language and the absence of language regarding liability during appeal found in other bail bonds,
the Court concludes that the reasonable intention of the parties to this bail bond contract was not to create a bond covering appearances during or after appeal. It was not the intention of the parties that this bond be in effect during the appellate process.
This conclusion, based on the plain meaning of the bail bond, is borne out by the parties’ actions. Defense counsel, at the sentencing hearing of June 11, 1984, asked for a short stay or extension so that he could file the notice of appeal and arrange for an appellate bond. This request evidences Mr. Banks intention (as represented through his defense counsel) that the bond cover only trial court appearances before appeal.
Also, the defense counsel represented that he had contacted the “original bail bondsman” who “originally posted this bond.”
The reference to “original” suggests that Mr. Banks’ contemplated that a “subsequent” bond would be necessary on appeal.
Thus, based on the language of the contract itself, a comparison with language of other bail bonds, and the parties’ actions as evidence of their intentions, the Court concludes that the parties intended that the bail bond only cover appearances before the district court occurring before the final judgment was appealed.
Ill
The additional issue remains as to whether Judge Irving could order the appearance bond executed by Dependable to continue in effect during the appeals period despite the parties’ intentions that the bond terminate before appeal.
Dependable argues that it cannot be held responsible for Banks’ appearances after sentencing because the increased risk of flight after sentencing was not something it bargained for when entering the bail bond. The government apparently argues that Judge Irving could extend the appearance bond’s coverage, under the reasoning of the
Martinez
case and an extension of the
Gonware
holding.
The
Martinez
court, in the course of interpreting a bail bond set and posted at the pretrial stage, engaged in an extensive analysis of the comparative risks of flight prior to and during appeal.
The court concluded that the risk of flight during appeal of a conviction was not necessarily greater than that during a brief stay of execution of sentence, where typically a
separate appeals bond is not obtained.
Id.
at 479. According to the
Martinez
court, if the trial judge, after balancing the increased risk of flight after conviction against defendant’s record in making appearances during trial, concludes that bond on appeal should remain at the same amount as the trial bond, he has implicitly determined that risk of flight is not increased on appeal. Thus, the appearance bond could be continued as an appeal bond as the surety was not taking on a risk of liability greater than it had bargained for. The court reasoned that, if courts can permissibly extend an appearance bond for a short period during a stay of execution of sentence, as in
Gonware,
then an appearance bond could also remain effective during appeal.
What the
Martinez
court failed to recognize, however, is that the surety’s obligation or scope of liability is not affected just by the amount of bond subject to forfeiture. “Converting” an initial appearance bond into an appeals bond does materially affect the surety’s risk, even if the amount of the bond remains the same. The surety, Dependable in this case, entered the appearance bond contract based on the expectation and understanding that the surety’s liability would cease before appeal. Extending the time frame of the bond such that the surety remains accountable for defendant’s appearances during or after appeal plainly increases the surety’s risk beyond what it bargained for. Such an extension is not the same as an extension for a brief, reasonable, and definite period of time, as with the
Gonware
-type short stays of execution of sentence. The time when a criminal conviction is on appeal is neither brief nor definite.
Thus extending a bond throughout appeal is unlike the common practice of extending an appearance bond during a brief stay of execution of sentence. Given the widespread nature of the practice, it can safely be said that sureties are aware of this practice and adjust for the risk accordingly when executing the bail bond contract.
Thus, although a court may implicitly acknowledge that the risk of flight for a particular defendant does not increase during appeal by fixing bail on appeal in the same amount, the surety’s risk is nonetheless increased when the term of the contract is extended beyond the contemplation of the parties. The court has no authority to change a term in the contract without the surety’s consent, when that change increases the surety’s obligation.
See United States v. LePicard,
723 F.2d 663, 665 (9th Cir.1984) (no authority holding that court can unilaterally impose on the bail surety a new and different obligation).
Cf. United States v. Galvez-Uriarte,
709 F.2d 1323, 1324 (9th Cir.1978) (government may not increase surety’s risk without surety’s knowledge and consent).
IV
In conclusion, the Court finds that the parties intended that the bail bond at issue, executed on January 18, 1984, apply only to appearances before the district court prior to appeal of Mr. Banks’ conviction. Although the appearance before the district court to spread the Ninth Circuit’s mandate was technically an appearance “before the district court”, it was not an appearance contemplated by the parties under the contract.
All of the bond’s conditions were fulfilled and the bond could have been exonerated as of the June 1984 sentencing.
See
Fed.R. Crim.P. 46(f) (court shall exonerate the obligors and release any bail when the condition of the bond has been satisfied). The bond is hereby ordered exonerated. Dependable’s motion to set aside forfeiture is granted; government’s motion to enter de
fault judgment on forfeiture of the bond is denied.
IT IS SO ORDERED.