What is the distinction between Guaranty and Suretyship?
1. Guaranty is collateral while Surety is an original promissory undertaking.
2. In guaranty, the guarantor is primarily liable while in suretyship, the surety is secondarily available.
3. The guarantor binds himself to pay if the principal cannot pay. The surety undertakes to pay if the principal does not pay.
4. The guarantor is the insurer of the solvency of the debtor. The surety is the insurer of the debt.
5. The guarantor can avail of the benefit of excussion and division in case the creditor proceeds against him. The surety cannot avail of the benefit of excussion and division.