Question

A person who gives the guarantee is called

• A. Bailee
• B. Creditor
• C. Debtor
• D. Surety

Hint:

Memorize the three parties in a contract of guarantee: - Principal Debtor: Owes the debt. - Creditor: Is owed the debt. - Surety: Guarantees the payment of the debt. (Make sure you are 'sure' - this helps remember 'surety').

Answer 1

The Correct Option is D

Step 1: Understanding the Concept:
The question asks for the legal term for the person who provides a guarantee in a contract of guarantee.

Step 2: Detailed Explanation:
Section 126 of the Indian Contract Act, 1872, defines the parties to a contract of guarantee. It states:
"A 'contract of guarantee' is a contract to perform the promise, or discharge the liability, of a third person in case of his default. The person who gives the guarantee is called the 'surety'; the person in respect of whose default the guarantee is given is called the 'principal debtor', and the person to whom the guarantee is given is called the 'creditor'."
This definition explicitly names the guarantor as the 'surety'.
- A Bailee (A) is a person to whom goods are delivered under a contract of bailment.
- A Creditor (B) is the person to whom the guarantee is given.
- A Debtor (C) (or Principal Debtor) is the person whose liability is guaranteed.

Step 3: Final Answer:
The person who gives the guarantee is called the Surety.