NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
PER CURIAM.
In these back-to-back matters, which we consolidate for purposes of this opinion, appellants Bandit Bail Bonds, LLC, and Across Da Street Bail Bonds, agents of First Indemnity of America Insurance Company (FIA, or the surety) appeal from the trial court's May 14, 2013 order denying their motions seeking exoneration on two bail bonds posted in Mercer County on behalf of defendant Alexander Lora. The primary issue in both cases is whether the surety is entitled to seek exoneration when the defendant is arrested and confined on new, unrelated charges. For the reasons that follow, we reverse and remand for further proceedings consistent with this opinion.
I.
We discern the following facts from the limited record. On August 3, 2012, FIA, through its agent, Across Da Street Bail Bonds, issued a $117,500 bail bond on behalf of Lora, who was charged in Mercer County in complaint W2012-001742-1103. On September 26, 2012, FIA, through its agent, Bandit Bail Bonds, issued another bail bond on Lora's behalf, in the amount of $75,000, relative to complaint W2012-000200-1106.1
For purposes of the issue before us, Lora was required to sign identical documents described as "Conditions of Release" with the bonding agents, and an indemnity agreement with FIA. The "Conditions of Release" contained the following provision:
(6) REARREST OR INCARCERATION OF DEFANDANT (sic). Indemnitors shall notify [the bail bond agent] if the defendant is incarcerated in any correctional facility at any time. Should the defendant be incarcerated on the instant offense or a new charge then [the bail bond agent] reserves the right to apply to the court with which the bond was posted to have the bail bond . . . revoked and/or request a warrant for the defendant's arrest.
Additionally, FIA's indemnity agreement specified that it "may at any time take such steps as it may deem necessary to obtain its release from any and all liability under any of said bonds"; and "may secure and further indemnify itself . . . in any manner it may think proper including surrender of the defendant (either before or after forfeiture and/or payment) if [it] shall deem the same advisable."
On October 4, 2012, defendant was arrested on new charges, and incarcerated in the Mercer County Jail.2 Citing defendant's alleged breach of his contractual obligations, and also arguing that defendant's new charges increased his risk of flight, the surety, through its agents, promptly moved to have the bail bonds revoked and discharged, and to be exonerated from further liability on them. Defendant, represented by counsel, opposed the motions. He argued that the surety failed to establish it had incurred a materially increased risk, as defendant did not flee, he had never missed a court date, his bails had never been forfeited, and the surety had continued to issue separate bonds and collect additional premiums to secure defendant's release.3
The court heard oral argument on the motion on November 15, 2012, and again on May 2, 2013, after allowing the parties to brief the legal issues presented. As of the May 2, 2013 hearing date, defendant remained incarcerated, although counsel for the surety advised that "defendant was in custody then, at some point, was released from custody and was placed back in custody." He further represented that, at the time of defendant's subsequent incarceration, defendant had a $90,000 bail set on seven Monmouth County charges that included burglary, theft, criminal trespass, and criminal mischief. In response, defense counsel advised the court that defendant had been released on November 17, 2012, but that in January 2013 he was indicted in Ocean County, and was again incarcerated on a $250,000 cash-only bail.4
On May 14, 2013, the court issued an order denying FIA's motions to be exonerated as surety, accompanied by a written decision in which it concluded:
Here, it is true that defendant has not missed any court appearances. In the absence of an increased risk of flight, defendant's arrest appears to be part of [FIA's] bargained-for risk. His October 4, 2012, arrest was for improper behavior, obstructing the administration of law, and resisting arrest. These additional charges do not implicate the substantial increase in risk the surety faced when the defendant in [State v. Ceylan, 352 N.J.Super. 139 (App. Div.), certif. denied, 174 N.J. 545 (2002)] was charged with aggravated manslaughter.
The right to apply for revocation of the bond is not the right to have the bond revoked. If the "Conditions of Release" included a sentence that "Defendant shall not be arrested or incarcerated," [FIA] would have a winning argument. However, the terms of the agreement specifically contemplate the possibility of defendant's subsequent incarceration. [FIA] exercised its right to apply for exoneration but because there had not been a material increase in the surety's bargained-for risk, [FIA's] motion for exoneration is DENIED.
On appeal, FIA challenges the court's denial of its application to discharge the two Mercer County bail bonds and be exonerated from any liability thereunder. It continues to argue, as it did before the trial court, that after posting those bonds, defendant was incarcerated and charged with significant offenses accompanied by significant bails. Thus, FIA submits, defendant's subsequent behavior altered the parties' original contractual agreement, and significantly increased defendant's risk of flight, thereby materially increasing FIA's risk.5
II.
We begin our analysis by recognizing certain well-settled principles. The bail bond is a surety agreement in which the defendant is the principal, and the government is the creditor. See, e.g., State v. Calcano, 397 N.J.Super. 302, 305 (App. Div. 2007), certif. denied, 194 N.J. 446 (2008). The law of suretyship applies. Ibid. "The surety will be discharged as a matter of law where the agreement has been modified without notice and consent and where the modification `materially increases his risk.'" Id. at 306 (quoting State v. Vendrell, 197 N.J.Super. 232, 237 (App. Div. 1984)); see also State v. Tuthill, 389 N.J.Super. 144, 148 (App. Div. 2006), certif. denied, 192 N.J. 69 (2007); State v. Clayton, 361 N.J.Super. 388, 395 (App. Div. 2003); Ceylan, supra, 352 N.J. Super. at 143. On appeal, we must determine whether the trial judge's denial of FIA's motion for exoneration constituted an abuse of discretion. Ceylan, supra, 352 N.J. Super. at 142, 145.
In the present cases, the surety, in its agreements with defendant, expressly reserved the right to apply to the court to have the bail bonds revoked should defendant be arrested and incarcerated on a new charge. These contractual provisions, however, did not confer upon FIA the right to automatically obtain such relief, as the motion judge correctly recognized. Indeed, a contrary conclusion might allow an unscrupulous surety to automatically revoke the issuance of a bail bond, and thereby retain a substantial, non-refundable premium, based simply upon a defendant's arrest for a minor offense which does not materially increase the surety's bargained-for risk.
No New Jersey statute, court rule, or reported case appears to squarely address the issue of whether a defendant's arrest and incarceration for a different offense operates to relieve the surety on the defendant's original bond.6 However, as noted, analogous cases generally frame the surety's right to seek exoneration, or remission of a bail that was forfeited, in terms of whether the risk to the surety has materially increased.
For example, in Ceylan, supra, 352 N.J. Super. at 141, Ceylan was arrested and charged with second-degree eluding, and posted bail. A few months later he was indicted on an unrelated first-degree aggravated manslaughter charge. A $500,000 bail was set on the manslaughter charge, which defendant met by posting a bail bond issued by Amwest Surety Insurance Company. Ibid. Later, before the manslaughter charge was heard, defendant was convicted of the eluding charge. Prior to sentencing, Amwest moved to surrender Ceylan and obtain exoneration on the bond issued by it on the manslaughter charge. Id. at 142. Although the trial court acknowledged that a material increase in the risk had occurred, it was apparently satisfied that the increased risk had been addressed by the new $200,000 bail set in the eluding matter. Ibid. In reversing, we held:
In this case, the establishment of new bail in a substantial sum signaled recognition by the court and the State that the risk of defendant's flight had changed materially from that existing prior to trial. Defendant was now facing the virtual certainty of at least a presumptive seven-year sentence for eluding in addition to pending aggravated manslaughter charges that carried with them a presumptive twenty-year jail sentence, as well as a substantial period without parole. We hold that the very factors that led the court to set new bail at the level that it did and would have impelled it to retain defendant in custody if bail were not met were those factors that should have caused it to find a material change in circumstance sufficient to warrant surrender and exoneration.
[Id. at 144-145.]
Similarly, in Clayton, supra, 361 N.J. Super. at 394-95, we found an increased risk to the surety, warranting a complete remission of the bail, where the trial judge, without notice to or consent of the surety, reinstated the original bond and again released a defendant who had fled and was later apprehended and returned to custody by the surety. We reiterated these principles in Calcano, supra, 397 N.J. Super. at 306, where we recognized the distinction between modifications to the surety agreement that materially increase the surety's risk, and those that do not, and are hence permissible. See also Tuthill, supra, 389 N.J. Super. at 149 ("Obviously, not every modification or change in the conditions of pretrial release will materially increase the surety's risk.").
In the present case, the motion judge determined that FIA's risk was not materially increased as a result of the charges stemming from his October 4, 2012 arrest. However, our review of the judge's decision is hampered by the failure of the record to include the complaints underlying the three bail bonds issued by FIA, including the Monmouth County bond and the two Mercer County bonds that are the subject of this appeal. Nor does the record include the October 4, 2012 charges that precipitated FIA's motions, or the subsequent January 2013 Ocean County indictment. Additionally, the motion judge appears to have given no consideration to the effect of that Ocean County indictment, which resulted in defendant's most recent incarceration and the setting of a significant $250,000 cash-only bail.
Accordingly, we remand these matters back to the trial court to reconsider the surety's applications. On remand, applying the above-noted principles, the court should carefully evaluate whether FIA's risk on the bonds has been materially increased as a result of defendant's new charges. As part of its analysis, the court should also consider the effect of the Ocean County indictment, and whether the substantial bail set there has materially increased defendant's risk of flight. Ceylan, supra, 352 N.J. Super. at 144-45.
Reversed and remanded. We do not retain jurisdiction.
