In which circumstances does guarantee becomes illegal / invalid?

1.	In which circumstances does guarantee becomes illegal / invalid?
Answer» 1. When creditor doesn’t reveal all the facts, related to principal debtor. 2. If the guarantee given by surety is not at the request of the principal debtor. 3. If any changes are made in the terms of the contract by the principal creditor without informing the surety. 4. The lunacy of the surety will discharge him of his future liability towards the guarantee given. 5. A guarantee obtained by means of misrepresentation made by the creditor.

Answer»

1. When creditor doesn’t reveal all the facts, related to principal debtor.

2. If the guarantee given by surety is not at the request of the principal debtor.

3. If any changes are made in the terms of the contract by the principal creditor without informing the surety.

4. The lunacy of the surety will discharge him of his future liability towards the guarantee given.

5. A guarantee obtained by means of misrepresentation made by the creditor.

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