Surety - His Liability as Endorser of a Promissory Note
By
K. Chalapati Rao
Under law, there can be no surety unless there is a principal debtor, as the surety's liability depends on the latter's default. It is, however, not necessary that the principal debtor should as a matter of law be an express party to a contract of guarantee. It is sufficient that the principal debtor is a party to the contract by implication. (Suresh Narain Sinha v. Akhavri, AIR 1957 Pat 256). A person may, therefore, become a surety without the knowledge and consent of the principal debtor, acquiring all the rights of the surety except perhaps the right to get indemnified by the principal debtor in such circumstances. (Muthu Raman v. Chinna Vellayan, ILR 39 Mad 965 : AIR 1917 Mad 83).
Section 126 of the Indian Contract Act defines a contract of guarantee as a contract to perform the promise or discharge the liability of a third party in case of the default. The person who gives the guarantee is called the "surety". The definition of the word "surety" in ....