Suretyship Issue 1

I am involved in two court cases currently revolving around Surety-ships in the High Supreme Court and I am going to need my ‘footwork’ to be swift to deal with them in order to protect the interests of my attorney’s client.

Therefore the following in terms of Surety-ships:

The Contract of surety is an agreement by means of which one person (the surety) renders himself or herself liable towards a creditor for the proper compliance of the obligations of a debtor.

In such a case there are, therefore, two debtors, namely the debtor in the first agreement (the principal debtor) and the debtor in the contract of surety (the surety).

The Principal debtor remains liable in terms of his or her agreement with the creditor.

The liability of the surety is additional to this.

It is an essential characteristic of the contract of suretyship that it is accessory to the principal obligation between the original debtor and creditor.

The issue of surety, therefore, cannot arise if there is no principle debt.

There may be more than one principal debt.

In a so-called ‘continuing suretyship’, for example, the surety may render himself or herself liable for any debt owed by the principal debtor, or for the liability of the principal debtor arising from a series of transactions (for example, the sale of goods on a running account).

So in short we can define surety as follows:

It is an undertaking to be liable for due performance of a debt owed by another person in favour of a creditor, in the event of the former’s default.

In afrikaans surety refers to 'borg' and surety-ship refers to 'borgstelling'. 

Here is also something you might want to ponder upon when considering to stand surety for somebody:

Proverbs 22:26

“Be not thou one of them that strike hands, or of them that are sureties for debts”.

But what does this biblical verse means:-  Do not be quick to strike hands (quick to make contracts and give promises), or to be surety for the debts of others.  If you have nothing to pay why lose the necessities of life by pledging them as security?