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When the Surety May Be Sued

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WHEN THE SURETY MAY BE SUED. Though the contract of the surety is in effect collateral to that of the principal, yet, when by the terms of the contract the obligation of the surety or guarantor is the same as that of the prin cipal, the creditor, upon default, may sue the surety or guarantor immediately without any proceeding against the principal. (Penny v. Crane Bros. Mfg. Co., 8o III., 244.) No demand on the principal is necessary in such cases before suit, and the suit itself is a sufficient demand on the surety or guar antor. (Hough v. Aetna L. Ins. Co., 57 Ill., 318; Carr v. Card, 34 Mo., 513.) This is true, also, where the creditor has a mortgage or other security, he need not exhaust the security of the principal before looking to the surety. (Jones v. Ashford, 79 N. C., 172.) This is the common law rule and pre vails in England and the United States, except where changed by statute. By the Roman Law after the time of Justinian the surety had the right to require the creditor to pursue the principal debtor to judgment and execution, before becoming liable on his obligation.

But where the guaranty in terms is to insure the collection of a debt of another, there is no default of the guarantor until the creditor has attempted by due course of law to collect the debt from the prin cipal debtor. (Ralph v. Eldredge, 58 Hun., 203; Lernmon v. Strong, 55 Conn., 443.) Some cases hold that legal proceedings to collect are imperative before the liability of the guarantor attaches, and this though the principal debtor is insolvent. But the guarantor would be responsible for the costs made in the attempt to collect in such cases. (Craig v. Parkis, 40 N. Y., 181; Brandt, Sur. & Guar., Sec. 98.) The better opinion seems to be that other competent evidence to show that the principal debtor was insolvent would take the place of an actual suit. (Stone v. Rockefeller, 29 0. St., 625; Brackett v. Rich, 23 Minn., 485.) Where there is a guaranty of a note or bond which in terms makes the guarantor liable for the payment of the instrument, it is generally held that the holder could not look to such guarantor unless he had first been diligent in attempting to collect from the principal debtor. (Cowles v. Peck, 55 Conn., 251; Johnston v. Chapman, 3 Pen & Watts, 18.) So if a note is guarantied to be collectible, the creditor must exhaust the estate of all prior solvent parties before the guarantor can be made to pay. (Pittman v. Chisolm, 43 Ga., 442; McClurg v. Fryer, 15 Pa. St., 293.)

principal, guarantor, debtor and creditor