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Directions: Read the following passage and answer the question.
The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.
The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.
Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.
In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.
Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.
  • a)
    The family members of A will have to pay in case of any default.
  • b)
    B will have to go to the court and claim for repayment of credit from A alone.
  • c)
    C will have to pay as he is the surety of A.
  • d)
    No one will be liable to repay the credit amount as there was no free consent for appointment of surety.
Correct answer is option 'C'. Can you explain this answer?
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Directions: Read the following passage and answer the question.The te...
A is the principal debtor. B is the creditor and C is the surety. In case of a contract of guarantee, the liability of the surety is secondary and it arises when the principal debtor defaults. Therefore, C is liable to pay.
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The question is based on the reasoning and arguments, or facts and principles set out in the passage. Some of these principles may not be true in the real or legal sense, yet you must conclusively assume that they are true for the purpose. Please answer the question on the basis of what is stated or implied in the passage. Do not rely on any principle of law other than the ones supplied to you, and do not assume any facts other than those supplied to you when answering the question. Please choose the option that most accurately and comprehensively answers the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q.A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. As business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.

Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.[Extracted with edits and revision from Contract of Indemnity, article by taxmanagementindia]Q. A borrows funds from B to launch a new business venture, and at Bs insistence, A designates C as a surety. Unfortunately, As business is severely impacted by a market recession, leading to his inability to settle his financial obligations. In response, B initiates legal action against C to recover the outstanding debt from A. Determine the outcome.

Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A hires B to kill C. A and B enter into an indemnity agreement, wherein B will be reimbursed if B is hurt or injured in the process of killing C. B gets hurt when he tries to kill C. Can B claim the reimbursement?

Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A and B enter into a contract of indemnity. A promises B to indemnify B in case of any damage to his car, while he is driving. B's servant crashes the car. Can B claim indemnity?

Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A promises B to indemnify him in case his house is damaged by fire. B negligently lights up a firecracker in his house and burns it down. Now B wants to claim indemnity. Can B claim the reimbursement?

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Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer?
Question Description
Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer? for CLAT 2024 is part of CLAT preparation. The Question and answers have been prepared according to the CLAT exam syllabus. Information about Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for CLAT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer?.
Solutions for Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for CLAT. Download more important topics, notes, lectures and mock test series for CLAT Exam by signing up for free.
Here you can find the meaning of Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer?, a detailed solution for Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer? has been provided alongside types of Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice Directions: Read the following passage and answer the question.The term indemnity literally means security against loss. In a contract of indemnity, one party, i.e. the indemnifier, promise to compensate the other party, i.e. the indemnified, against the loss suffered by the other. The English law defines a contract of indemnity as a promise to save a person harmless from the consequences of an act. Thus, it includes within its ambit losses caused not merely by human agency, but also those caused by accident or fire or other natural calamities. As per Section 124 of the Contract Act, a contract of indemnity is that contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person.The definition provided by the Indian Contract Act confines itself to the losses occasioned due to the act of the promisor or due to the act of any other person. Under a contract of indemnity, liability of the promisor arises from loss caused to the promisee by the conduct of the promisor himself, or as per the terms in the indemnity contract. Every contract of insurance, other than life insurance, is a contract of indemnity. The definition is restricted to cases where loss has been caused by some human agency.Section 124 deals with one particular kind of indemnity which arises from a promise made by an indemnifier to save the indemnified from the loss caused to him by the conduct of the indemnifier himself or by the conduct of any other person, but does not deal with those classes of cases where the indemnity arises from loss caused by events or accidents which do not depend upon the conduct of indemnifier or any other person.In a contract of indemnity, there are two parties, i.e. indemnifier and indemnified. A contract of guarantee involves three parties, i.e. creditor, principal debtor and surety. An indemnity is for reimbursement of a loss, while a guarantee is for security of the creditor. In a contract of indemnity, the liability of the indemnifier is primary and arises when the contingent event occurs. In case of contract of guarantee, the liability of surety is secondary and arises when the principal debtor defaults. The indemnifier after performing his part of the promise has no rights against the third party and he can sue the third party only if there is an assignment in his favour. Whereas in a contract of guarantee, the surety steps into the shoes of the creditor on discharge of his liability, and may sue the principal debtor.Q. A takes credit from B for starting a new business and on the insistence of B, A appoints C as surety. A's business venture was immensely hit by the recession in the market and he fails to pay his dues. B sues C for the money which he owes from A. Decide.a)The family members of A will have to pay in case of any default.b)B will have to go to the court and claim for repayment of credit from A alone.c)C will have to pay as he is the surety of A.d)No one will be liable to repay the credit amount as there was no free consent for appointment of surety.Correct answer is option 'C'. Can you explain this answer? tests, examples and also practice CLAT tests.
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