Guarantee essay

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Guarantee essay in 2021

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Who is the surety in a guarantee agreement?

The person who gives guarantee is called the “surety”, the person in respect of whose default the guarantee is given is called the “principal debtor” and the person to whom the guarantee is given is called the “creditor”.

Which is an example of a contract of guarantee?

For example in the old case of Birkmyr v Darnell [ 5] the court said: “If two come to a shop one buys and the other to give him credit, promises the seller, ‘If he does not pay you, I will’.” This type of collateral undertaking to be liable for the default of another is called a “Contract of guarantee”.

How is a guarantee defined in English law?

In English law a guarantee is defined as “a promise to answer for the debt, default or miscarriage of another [ 6] .” It is collateral engagement to be liable for the debt of another in case of his default. “Guarantee are usually taken to provide a second pocket to pay if the first should be empty [ 7] .”

Which is a sufficient consideration for a guarantee?

A guarantee may be either oral or written. Consideration for guarantee.-Anything done, or any promise made, for the benefit of the principal debtor, may be a sufficient consideration to the surety for giving the guarantee. (a) B requests A to sell and deliver to him goods on credit.

Last Update: Oct 2021


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