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Please explain example number 42 and in the highlighted point what is the benefit of of surety if he is also going to claim the the reduction in liability as the very purpose of surety is to secure the transaction i.e. secure the payment
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Thread Starter
Gauri Sheteyes but in the highlighted point what is the fault of creditor he must have relied upon the surety and given the loan ...the surety must think of position of principal debtor before giving the guarantee
No, that's not how things are in practical life. For that matter, what is the fault of surety then - things may make a person insolvent. Same goes for even creditor, he must think of principal debtor before giving loan. It is well setlled by law, elsewise contract of gurantees would always be used with some doubt.
Example 42: What's your doubt here? Highlighted point: That benefit of surety is in case of default. Here, debtor has become insolvent, which even surety would not have thought as he faces a risk too because after paying to creditor, it can only recover little from debtor, so law allows right of reduction.
Thread Starter
Gauri SheteWhat is the meaning of C gives up the further security. shouldn't A be discharged when C gives up the further security as surety is entitled to benefit the security which creditor has against the debtor (sec141)
But that security given up is further security which was taken up after contract
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