CA Foundation Exam > CA Foundation Questions > Surety stands discharged:a)by an agreement be...
Start Learning for Free
Surety stands discharged:
- a)by an agreement between the creditor and the principal debtor
- b)by an agreement between the creditor & a third party for not to sue the principal debtor
- c)both (a) & (b) above
- d)neither (a) nor (b).
Correct answer is option 'A'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Most Upvoted Answer
Surety stands discharged:a)by an agreement between the creditor and th...
Explanation:
- Surety stands discharged:
- When there is an agreement between the creditor and the principal debtor, the surety stands discharged. This means that the surety is released from their obligations as the guarantor.
- Such an agreement implies that the creditor has agreed to release the surety from their obligations, usually because the principal debtor has fulfilled their obligations or the creditor has agreed to a new payment arrangement directly with the principal debtor.
Free Test
FREE
| Start Free Test |
Community Answer
Surety stands discharged:a)by an agreement between the creditor and th...
Understanding Surety Discharge
In the context of contracts, a surety is someone who agrees to take responsibility for the debt or obligation of another. Knowing when a surety is discharged from this responsibility is crucial.
Discharge by Agreement
- A surety can be discharged by an agreement between the creditor and the principal debtor.
- This means if the creditor and the principal debtor agree to modify or release the terms of the contract, the surety is no longer liable.
- This release can occur without the surety's consent, as their obligation is tied to the original agreement between the creditor and the debtor.
Discharge by Third Party Agreement
- The option that mentions an agreement between the creditor and a third party not to sue the principal debtor does not automatically discharge the surety.
- The surety's liability remains unless specified otherwise in the contract, as the third party's agreement does not directly impact the surety's obligations.
Conclusion
- Therefore, the correct answer is option 'A' because the surety is effectively discharged from liability when there is an agreement between the creditor and the principal debtor.
- Understanding the nuances of suretyship is vital for anyone involved in financial agreements or contracts, especially in the CA Foundation context.
In summary, the relationship and agreements between the creditor and the principal debtor play a pivotal role in determining the discharge of a surety.
In the context of contracts, a surety is someone who agrees to take responsibility for the debt or obligation of another. Knowing when a surety is discharged from this responsibility is crucial.
Discharge by Agreement
- A surety can be discharged by an agreement between the creditor and the principal debtor.
- This means if the creditor and the principal debtor agree to modify or release the terms of the contract, the surety is no longer liable.
- This release can occur without the surety's consent, as their obligation is tied to the original agreement between the creditor and the debtor.
Discharge by Third Party Agreement
- The option that mentions an agreement between the creditor and a third party not to sue the principal debtor does not automatically discharge the surety.
- The surety's liability remains unless specified otherwise in the contract, as the third party's agreement does not directly impact the surety's obligations.
Conclusion
- Therefore, the correct answer is option 'A' because the surety is effectively discharged from liability when there is an agreement between the creditor and the principal debtor.
- Understanding the nuances of suretyship is vital for anyone involved in financial agreements or contracts, especially in the CA Foundation context.
In summary, the relationship and agreements between the creditor and the principal debtor play a pivotal role in determining the discharge of a surety.
Attention CA Foundation Students!
To make sure you are not studying endlessly, EduRev has designed CA Foundation study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in CA Foundation.
|
Explore Courses for CA Foundation exam
|
|
Similar CA Foundation Doubts
Top Courses for CA FoundationView all
Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer?
Question Description
Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer?.
Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer?.
Solutions for Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer?, a detailed solution for Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer? has been provided alongside types of Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Surety stands discharged:a)by an agreement between the creditor and the principal debtorb)by an agreement between the creditor & a third party for not to sue the principal debtorc)both (a) & (b) aboved)neither (a) nor (b).Correct answer is option 'A'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
|
|
Explore Courses for CA Foundation exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup