Some aspects of the law of suretyship

Abstract

It is the established legal principal that a debtor is personally liable for his debts with all his property, present and future. Now it may be the case that, in spite of this security guaranteed by the law itself t a creditor may not be satisfied with what is actually guaranteeing the debt due to him. In this kind of situation, circumstances may require that a guarantee be given by a third party who is independent of the relationship be it contractual or otherwise, between creditor and debtor (the latter is known in similar matters as the principal debtor). The creditor may only be satisfied if the property of a third party goes to guarantee what is due to him by the principal debtor. When the liability of a third party to a relationship is added to that of the principal debtor, the liability of such third party may take two distinct forms. The third party may, like the principal debtor, be bound personally with all his property present and future. On the other hand, the other form of liability involves pledging (and the word is used here in its linguistic rather than strictly legal meaning) one or other particular object of his estate. Such is the case of the granting of a hypothec, where the third party cannot be held liable for anything beyond the value of the property he has hypothecated He contracts no personal liability whatsoever but is only liable "propter rem". The subject under review, the institute of suretyship falls under the first of these two types of securities. The creditor, once a surety is obtained, obtains thereby a personal guarantee. The obligation hitherto owed by the principal debtor is thereby duplicated in the surety. There are now two debtors:principal debtor and surety, both bound similarly for one obligation.towards the creditor.