Suretyship

Contract, under the terms of which a guarantor assumes responsibility with respect to the creditor for fulfillment of the commitment of a debtor. The contract represents a unilateral obligation on the part of the guarantor, while the creditor only has rights under the terms of the contract. The suretyship presupposes the existence of a principal debt, to which the suretyship is incidentally bound. There are various types of suretyship. The most familiar are directly-liable suretyship, the deficiency or modified-deficiency suretyship and the co-suretyship. Suretyships are also established in the case of recourse guarantees or bank surety credits.