Page 90 - DMGT102_MERCANTILE_LAWS_I

Mercantile Laws-I Manpreet Kaur, Lovely Professional University

Notes Unit 7: Contracts of Guarantee and Indemnity

CONTENTS

Objectives
Introduction
7.1 Purpose and Meaning of the Contracts of Guarantee
7.1.1 Purpose of Guarantee
7.1.2 Definition and Nature of the Contract of Guarantee (S.126)

7.1.3 Fiduciary Relationship
7.2 Kinds of Guarantee
7.2.1 Oral or Written Guarantee

7.2.2 Specific and Continuing Guarantee
7.2.3 A Guarantee may either be for the Whole Debt or a Part of the Debt
7.3 Right and Obligations of Creditors
7.3.1 Rights of a Creditor
7.3.2 Obligations Imposed on a Creditor in a Contract of Guarantee
7.4 Rights, Liability and Discharge of Surety

7.4.1 Rights against the Creditor
7.4.2 Rights against the Principal Debtor
7.4.3 Rights against Co-sureties
7.4.4 Liability of Surety

7.4.5 Discharge of Surety
7.5 Meaning of Indemnity

7.5.1 Rights of the Indemnified (i.e., the Indemnity Holder)
7.5.2 Rights of the Indemnifi er
7.5.3 Commencement of Indemnifi er’s Liability
7.5.4 Distinction between a Contract of Guarantee and a Contract of Indemnity

7.6 Summary
7.7 Keywords
7.8 Self Assessment
7.9 Review Questions

7.10 Further Readings

84 LOVELY PROFESSIONAL UNIVERSITY