The Concept and Function of Suretyship
For a creditor, the enforcement of a guarantee begins with understanding the legal nature of suretyship. Under Article 891 of the Civil Code of Georgia, under a contract of suretyship the surety undertakes an obligation to stand as surety before the creditor for a third person, for the performance of that person’s obligation. The surety thus answers to the creditor directly, with an obligation of its own, for the principal debtor’s performance.
The second part of the same article keeps the frame of suretyship open: suretyship may also be applied to future and conditional obligations. This means that the creditor and the surety may agree today on a guarantee for an obligation that will arise in the future or that depends on the occurrence of a condition — for example, for future claims connected with the completion of construction or the use of a loan. It is precisely this flexibility that keeps suretyship the principal protective instrument of creditors in banking and construction practice.
The Joint and Several Liability of Several Sureties
Article 896 answers one of the most frequent questions — what happens where the sureties for one and the same obligation are several persons. The rule is maximally favourable to the creditor: they answer as joint and several debtors, even where they have not jointly assumed the suretyship. The absence of an internal agreement between the sureties therefore does not limit the creditor’s right.
The practical consequence of solidarity is clear: the creditor may present its claim to all the sureties simultaneously or to any one of them, within any part of the amount. The question of the comparative shares of the sureties concerns their internal relationship and does not hinder the creditor’s claim. When preparing the action it is therefore a sound decision to indicate all the sureties as co-defendants — the practical prospect of enforcement is then at its greatest.