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Mohamed Shakeel (Proprietor)     07 January 2014

Gurantor's consideration

Sir in a Bank Loan when third party guarantee is given, what is the consideration from the Borrower to the Guarantor?. If this is absent will there be a discharge of surety?. If the Guarantor's property is sold by the Creditor and the Guarantor invokes Indemnity right will it stand without a valid agreement with consideration between the Borrower and Guarantor?


 2 Replies

narendra.s.p (Chief Manager(Law))     08 January 2014

127 of Contract Act:.Consideration for guarantee.-Anything done, or any promise

made, for the benefit of the principal debtor, may be a sufficient

consideration to the surety for giving the guarantee.

SHIRISH PAWAR, 7738990900 (Advocate)     08 January 2014

There is a implied indemnity specific agreement is not required.

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