10 Questions
What are the 3 parties involved in a Contract of Guarantee?
Surety, Principal, Creditor
When does the role of the surety in a Contract of Guarantee typically arise?
When there is a default by the principal debtor
According to Section 127, what may be considered as a sufficient consideration for the surety to give the guarantee?
Anything done for the benefit of the principal debtor
What does Section 128 say about the liability of the surety in a Contract of Guarantee?
It is co-extensive with that of the debtor
What type of consent should be obtained from the surety in a Contract of Guarantee?
Consent not obtained by misrepresentation or concealment
What type of guarantee involves a series of transactions?
Continuing guarantee
In the case of State Bank of India v. G.J Herman, who has the authority to decide from whom the debt should be recovered?
The sureties
Under what circumstances can a surety revoke their contract of guarantee?
Only for future continuous transactions by sending a notice to the creditor
What action can discharge a surety's liability under Section 141 of the Indian Contract Act, 1872?
Loss of security
In which scenario is revocation of a guarantee not possible according to Section 131 of the Indian Contract Act, 1872?
After the contract has been acted upon
Learn about Contract of Guarantee defined in Section 126, involving parties like Surety, Principal Debtor, and Creditor. Understand the secondary role of the surety and the obligations involved in case of default.
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