Law Dictionary

Question XV, Civil Law, 2017 Bar Exam

Notice: The following suggested answers simulate those that a bar examinee may provide as an answer to a bar exam question. Thus, specific citations (i.e., republic acts, articles/sections, jurisprudence, etc.) are not provided because it is not required in the bar exam. For purposes other than answering the bar exam, please be reminded that proper referencing or legal citation is required.

Question XV, Civil Law, 2017 Bar Exam

Kevin signed a loan agreement with ABC Bank. To secure payment, Kevin requested his girlfriend Rosella to execute a document entitled “Continuing Guaranty Agreement” whereby she expressly agreed to be solidarily liable for the obligation of Kevin.

Can ABC Bank proceed directly against Rosella upon Kevin’s default even without proceeding against Kevin first? Explain your answer. (3%)

Suggested Answer:

Yes. Answer

Under jurisprudence, a contract of surety creates a solidary obligation on the part of the surety to guarantee the performance of the debtor. The surety is directly liable for the non-performance of the debtor. Rule

In the case at bar, Rosella entered into a contract of surety despite the document being referred to as a “Continuing Guaranty Agreement”. This is due to the fact that he as surety expressly agreed to be solidarily liable for the obligation of Kevin. Apply

Thus, ABC Bank can proceed directly against Rosella upon Kevin’s default even without proceeding against Kevin first. Conclusion

Disclaimer: All information is for educational and general information only. These should not be taken as professional legal advice or opinion. Please consult a competent lawyer to address your specific concerns. Any statements or opinions of the author are solely his own and do not reflect that of any organization he may be connected.

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