pre-release security
Definition
Pre-release security is a financial guarantee that someone provides to a court or creditor before they are officially released from a legal obligation or custody. Think of it as a deposit or pledge you put up to show you are serious about meeting your future responsibilities. The person holding the security can keep it if you fail to follow through on whatever was promised.
Example
If your business is involved in a lawsuit and the court requires you to post pre-release security before they release frozen company funds, you might put up a cash deposit or property as proof that you will pay any judgment that comes against you.
Watch Out
The amount required for pre-release security can be substantial, so you should talk to a lawyer before agreeing to any terms so you fully understand what you are putting at risk.
See which terms appear in your contract?
This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.