According to the syllabus of B.com 1st year Prepared by- Ms. Neetu Kushwaha Research Scholar Department of Commerce

1. Course Co-Ordinator:
Ms. Neetu Kushwaha

2. 1. Right to claim contribution:
When one of the co-sureties is compelled
to pay the entire debt, he has right to
claim compensation from other co-
sureties.
i) Equal contribution in absence of
any contract to the contrary.
ii) Contribution when co-sureties
bound in different sums.

3. CONT….
2- Release of Co-surety:
Where there are co-sureties, a release
by the creditor of one of them does not
discharge the others. It also does not
free the surety so released from
responsibilities to other sureties.
[Sec.138]

4. CONT….
3- Rights to share benefits of
securities:
Where co-surety on discharge of a
debt, receives benefits of security held
by the creditor, the other co-sureties
are entitled to claim a share in such
security. They share the liability of
guarantee and benefit of
securities in the equal
proportion.

5. • Liability out of contract
• Collateral/ Contingent liability
• Co- extensive
• Surety can limit his liability
• Rise of liability
• Liability even if no action is taken
against the principal debtor
• Liability in continuing guarantee

6. CONT…
• Liability may be extinguished
• No liability if guarantee is illegal
• Liability when original contract is void
or voidable:
i) Person incompetent to contract
ii) Time barred debt
iii) Insolvency
iv) Death