Surety (2010)

What is the difference between "guaranty" and "suretyship"?

SUGGESTED ANSWER:
Guaranty and Suretyship distinguished
(a) The obligation in guaranty is secondary; whereas, in suretyship, it is
primary.
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(b) In guranty, the undertaking is to pay if the principal debtor cannot pay;
whereas, in suretyship, the undertaking is to pay if the principal debtor does
not pay.
(c) In guranty, the guarantor is entitled to the benefit of excussion; whereas, in
suretyship the surety is not entitled.
(d) Liability in guaranty depends upon an independent agreement to pay the
obligations of the principal if he fails to do so; whereas, in suretyship, the
surety assumes liability as a regular party.
(e) The Guarantor insures the solvency of the principal debtor; whereas, the
surety insures the debt.
(f) In a guaranty, the guarantor is subsidiarlty liable; whereas, in a suretyship,
the surety binds himself solidarity with the principal debtor (Art 2047,
Civil Code).