Guarantee agreement is the personal liability of a third party (guarantor) towards the creditor for the debt of the debtor. It is regulated in TBK article 581-603.
Validity Conditions of Guarantee
- Written form obligation (TBK art.583)
- Determining in writing a certain amount for which the guarantor is responsible
- Writing the history of bail
- Subsidiary surety etc. Clearly stating the distinction between ordinary surety
- Writing all these elements in guarantor's handwriting
- Spouse consent (if married, TBK art. 584)
Spouse Consent (TBK article 584)
For the validity of the bail given by the married guarantor, the written consent of his/her spouse is required before the date of bail or at the time of bail at the latest. The bail made without the consent of the spouse is absolutely void.
Exception: Guarantees made in relation to professional activity (e.g. merchant guarantee).
Ordinary Bail vs. Joint and Joint Bail
Ordinary Bail
The creditor must first follow the principal debtor. He can apply to the guarantor for the part he cannot collect from the debtor (discussion def).
Subsidiary Guarantee
The creditor can apply directly to the guarantor. Banks generally receive joint guarantees.
Rights of the Guarantor
- Defenses of the principal debtor
- Controversial defense (in ordinary bail)
- Division def (in case of more than one guarantor)
- Right of recourse (getting back what you paid from the debtor)
Expiration of Bail
- Extinguishment of principal debt
- 10-year maximum period (TBK article 598) — real person guarantor
- Death of the guarantor (heirs are only liable for the value of the estate)
- If the additional period given to the principal debtor is not notified to the guarantor (TBK art. 594)
Supreme Court HGK Approach
The Supreme Court of Appeals HGK has consistently accepted that the bail given without the consent of the spouse is invalid with "absolute nullity" and that the good intentions of the creditor do not change this.
Surement contracts involve high risk; It is recommended that you review and limit the text with a obligations law lawyer.