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    Question

    What are the types of

    Guarantees?
    A Special Guarantee Correct Answer Incorrect Answer
    B Continuing Guarantee Correct Answer Incorrect Answer
    C Specific Guarantee Correct Answer Incorrect Answer
    D Both (b) & (c) Correct Answer Incorrect Answer

    Solution

    There are two types of contract of guarantee i.e. Specific guarantee and continuing guarantee. When a guarantee is given only for single debt or transaction and is to come to an end when the guaranteed debt is paid or the promise is duly performed, it is called a specific or simple guarantee. A guarantee which extends to a series of transactions is called a continuing guarantee. In this case the surety’s liability would continue till all the transactions are completed or till the guarantor revokes the guarantee as to the future transactions.

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