Legal Guarantees

Note: Want to skip the guide and go straight to the free templates? No problem - scroll to the bottom.
Also note: This is not legal advice.

Introduction

Definitions (feel free to skip)

Express guarantee: A written or verbal agreement between two parties which sets out the rights and obligations of each party.
Implied guarantee: An agreement between two parties which is not set out in writing but which is understood to exist due to certain circumstances.
Financial guarantee: A form of guarantee which is given by one party to another in order to secure a loan or other financial commitment.
Enforceable contract: A legally binding agreement which includes all necessary details and must be signed by the guarantor in order for it to be valid.
Restitution: The act of demanding payment from the guaranteed for the amount of the guarantee.

Contents

• Definition of a guarantee
• Types of guarantees
• Express guarantee
• Implied guarantee
• Financial guarantee
• The legal elements of a guarantee
• Agreement between two parties
• Identifying the guarantor
• Identification of the guaranteed
• The extent of the guarantee
• How to create a guarantee
• Draft the agreement
• Outline the terms and conditions
• Get approval from both parties
• Have the agreement reviewed by a lawyer
• How to ensure a guarantee is legally binding
• Use of an enforceable contract
• Include all necessary details
• Include a signature from the guarantor
• Ensure that all parties understand the terms
• The role of the guarantor
• Obligations of the guarantor
• Rights of the guarantor
• Limitations of the guarantor
• How to negotiate a guarantee
• Identify the key points of negotiation
• Agree on a timeframe for the guarantee
• Negotiate the extent of the guarantee
• Discuss any potential liabilities
• How to enforce a guarantee
• File a claim with the guarantor
• Provide evidence of the breach of the guarantee
• Follow the steps outlined in the agreement
• Seek legal advice if necessary
• The risks associated with guarantees
• Risk of default
• Financial risk to the guarantor
• Risk of litigation
• The remedies available for a breach of guarantee
• Termination of the guarantee
• Compensation for damages
• Restitution of the guaranteed amount

Get started

Definition of a guarantee

Types of guarantees

Express guarantee

Implied guarantee

Financial guarantee

The legal elements of a guarantee

Agreement between two parties

Identifying the guarantor

Identification of the guaranteed

The extent of the guarantee

How to create a guarantee

Draft the agreement

Outline the terms and conditions

Get approval from both parties

Have the agreement reviewed by a lawyer

How to ensure a guarantee is legally binding

Use of an enforceable contract

Include all necessary details

Include a signature from the guarantor

Ensure that all parties understand the terms

The role of the guarantor

Obligations of the guarantor

Rights of the guarantor

Limitations of the guarantor

How to negotiate a guarantee

Identify the key points of negotiation

Agree on a timeframe for the guarantee

Negotiate the extent of the guarantee

Discuss any potential liabilities

How to enforce a guarantee

File a claim with the guarantor

Provide evidence of the breach of the guarantee

Follow the steps outlined in the agreement

Seek legal advice if necessary

The risks associated with guarantees

Risk of default

Financial risk to the guarantor

Risk of litigation

The remedies available for a breach of guarantee

Termination of the guarantee

Compensation for damages

Restitution of the guaranteed amount

FAQ:

Example dispute

Lawsuits Involving Guarantees

• A plaintiff may raise a lawsuit against a company if the company failed to fulfill a guarantee it provided to the plaintiff.
• A guarantee is a promise made by a company to a consumer that the company will provide a certain level of quality or service.
• A plaintiff can raise a lawsuit if they believe that the company failed to uphold the guarantee and that they have suffered damages as a result.
• The plaintiff must provide evidence of the company’s guarantee and how it was breached.
• The plaintiff may be able to win the lawsuit if they can prove that the company failed to fulfill its guarantee and that they suffered losses due to the breach.
• If the plaintiff is successful, they may be able to receive compensation for their losses, including any damages, costs and lost profits.
• In some cases, the plaintiff may also be able to obtain an injunction ordering the company to fulfill its guarantee.

Templates available (free to use)

Abi Bond Form Of Guarantee
Authorised Guarantee Agreement For A New Lease Standalone Aga
Board Meeting Minutes For Guarantor To Approve Guarantee And Indemnity
Completion Guarantee
Counter Guarantee
Deed Of Express Release Of Tenants Guarantor Optional Substitute Guarantee
Deed Of Guarantee And Indemnity For Seller Obligations Share Purchase Agreement
Demand Guarantee
Directors Certificate Of Guarantee
Form Of Guarantee Agreement
Guarantee Agreement
Guarantee And Collateral Agreement
Guarantee And Indemnity For Payment Obligations Commercial Contract
Guarantee For Performance Of Obligations Commercial Contract
Guaranteed Maximum Price Amendment
Licence To Assign A Commercial Underlease With Guarantee
Limited Guarantee
Loan Guarantee Agreement
Members Resolution For Guaranteed Employment Period For Directors In Excess Of Two Years
Parent Company Guarantee
Parent Company Guarantee For Building And Engineering Work Payments
Parent Company Guarantee For Outsourcing Agreement
Parent Company Guarantee Pcg
Parent Guarantee
Payment Demand For Counter Guarantee
Payment Demand For Demand Guarantee
Sample Articles Of Association Private Limited By Guarantee
Sellers Deed Of Guarantee Under Asset Purchase Agreement
Simple Payment Guarantee
Standard Deed For Guarantor To Consent To Changes Of The Guaranteed Obligations Deed Of Consent
Subsidiary Guarantee
Written Resolution Of Members To Approve A Guarantee Private Company

‍