What is Revocation of continuing guarantee? Section 130 of Indian Contract Act 1872
130. A continuing guarantee may at any time be revoked by the surety, as to future transactions, by notice to the creditor.
Illustrations
(a) A, in consideration of B's discounting, at A's request,
bills of exchange for C, guarantees to B, for twelve months, the
due payment of all such bills to the extent of 5,000 rupees. B
discounts bills for C to the extent of 2,000 rupees. Afterwards,
at the end of three months, A revokes the guarantee. This
revocation discharges A from all liability to B for any
subsequent discount. But A is liable to B for the 2,000 rupees,
on default of C.
(b) A guarantees to B, to the extent of 10,000 rupees, that C shall pay all the bills that B shall draw upon him. B draws upon C. C accepts the bill. A gives notice of revocation. C dishonours the bill at maturity. A is liable upon his guarantee.
Section 126 - Contract of guarantee surety principal debtor and creditor
Section 127 - Consideration for guarantee
Section 128 - Suretys liability
Section 129 - Continuing guarantee
Section 130 - Revocation of continuing guarantee
Section 131 - Revocation of continuing guarantee by suretys death
Section 133 - Discharge of surety by variance in terms of contract
Section 134 - Discharge of surety by release or discharge of principal debtor
Section 137 - Creditors forbearance to sue does not discharge surety
Section 138 - Release of one co-surety does not discharge others
Section 139 - Discharge of surety by creditor's act or omission impairing surety's eventual remedy
Section 140 - Rights of surety on payment of performance
Section 141 - Suretys right to benefit of creditors securities
Section 142 - Guarantee obtained by misrepresentation invalid
Section 143 - Guarantee obtained by concealment invalid
Section 144 - Guarantee on contract that creditor shall not act on it until co-surety joins