guarantee


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Related to guarantee: Guarantee letter

Guarantee

One to whom a guaranty is made. This word is also used, as a noun, to denote the contract of guaranty or the obligation of a guarantor, and, as a verb, to denote the action of assuming the responsibilities of a guarantor.

guarantee

1) v. to pledge or agree to be responsible for another's debt or contractual performance if that other person does not pay or perform. Usually, the party receiving the guarantee will first try to collect or obtain performance from the debtor before trying to collect from the one making the guarantee (guarantor). 2) the promise to pay another's debt or fulfill contract obligations if that party fails to pay or perform. 3) n. occasionally, the person to whom the guarantee is made. 4) a promise to make a product good if it has some defect. (See: guarantor)

guarantee

verb answer for, assume responsibility, assure, back, be responsible for, become liable, become surety for, certify, commit oneself, ensure, fides, give assurrnce, give one's word, guard, hypothecate, impignorate, insure, make oneself answerable for, obligate, pledge, promise, safeguard, secure, sponsor, stake, support, underwrite, vadimonium, vouch for, warrant
Associated concepts: guarantee a title, guarantee against breakage, guarantee payment
See also: accommodation, adduce, agree, assure, attest, backing, bear, bond, certificate, certify, charge, close, confirm, consent, contract, corroborate, cosign, covenant, coverage, deposit, ensure, hostage, hypothecation, indemnify, indorse, insurance, insurer, lien, oath, pact, pawn, pledge, precaution, promise, protection, reassure, recommend, security, sponsor, stipulate, subscribe, swear, undertake, undertaking, underwrite, verify, vouch, vow, warranty

guarantee

a collateral promise to answer for the debt or obligation of another. A guarantee is a secondary obligation, becoming operative only where the principal debtor is in default; because it is a secondary obligation, should the primary obligation be unlawful or invalid or unenforceable, the guarantor or surety cannot be compelled to make payment under the guarantee. A guarantee should be distinguished from an indemnity, which is a primary obligation to compensate the loss of another; in the latter case the unenforceability of the principal debt will not render the indemnity unenforceable. In Scotland, the same relationship is regulated by the institution of caution (pronounced ‘cayshun’). Proper caution is the term used where the cautioner is expressly bound as guarantor to the creditor. The term improper caution is used when the cautioner is bound as a co-obligant with the principal debtor jointly and severally to the creditor.

The term is used colloquially in the UK for a statement by a manufacturer of goods that it will undertake some responsibility such as repair or replacement.

GUARANTEE, contracts. He lo whom a guaranty is made.
     2. The guarantee is entitled to receive payment, in the first place, from the debtor, and, secondly, from the guarantor. He must be careful not to give time beyond that stipulated in the original agreement, to the debtor, without the consent of the guarantor; the guarantee should, at the instance of the guarantor, bring an action against the principal for the recovery of the debt. 2 Johns. Oh. R. 554; 17 Johns. R. 384; 8 Serg. & Rawle, 116; 10 Serg. & Rawle, 33; 2 Bro. C. C. 579, 582; 2 Ves. jr. 542. But the mere omission of the guarantee to sue the principal debtor will not, in general, discharge the guarantor. 8 Serg. & Rawle, 112; 3 Yeates, R. 157; 6 Binn. R. 292, 300.

References in periodicals archive ?
Even though the issuance of a Bank Guarantee results in joint and several obligations of the Guarantor and the Principal Debtor, the Guarantor is only liable to pay to the Beneficiary upon an invocation of the Bank Guarantee by the Beneficiary and not upon a default or act or omission by the Principal Debtor.
FY 2000 - 100% of base guarantee FY 2007 - 80% of base guarantee FY 2008 - 60% of base guarantee FY 2009 - 40% of base guarantee FY 2010 - 20% of base guarantee FY 2011 and thereafter - 0% of base guarantee
Insurance companies provided a bond substitute product and provided a guarantee of a stated annual return.
This report not only elaborates the overall market of China guarantee industry and regional markets in key areas, but also highlights the key enterprises engaging in the industry.
Because E did not qualify for the loan on his own account, his father-in-law agreed to guarantee it.
State the terms of your guarantee in simple, direct, clear language.
All CNA products with terms of 10 to 25 years carry at least a 10-year rate guarantee.
Forced to go the distance in a lucky draw, Holyfield fell into the same category as George Bush, whose guarantee was no new taxes.
In many cases a creditor will insist that one or more of the corporation's shareholders personally guarantee the debt.
com/research/a1aeb7/china_guarantee_in) has announced the addition of the "China Guarantee Industry Investments and Market Outlook to 2011" report to their offering.