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Contracts of Guarantee
What is a contract of guarantee as defined under the Indian Contract Act, 1872?
A contract of guarantee is a contract to perform the promise or discharge the liability of a third person in case of his default. It involves three parties: the surety, the principal debtor, and the creditor.
What section of the Indian Contract Act, 1872 defines a contract of guarantee?
Section 126 defines contract of guarantee.
Who are the three parties to a contract of guarantee?
The three parties are the surety (person who gives the guarantee), the principal debtor (person whose default is guaranteed against), and the creditor (person to whom the guarantee is given).
What is the person who gives the guarantee in a contract of guarantee called?
The person who gives guarantee is called surety.
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