Multiple choice

A, in consideration that B will employ C in collecting the rents of B's Zamindari, promises B to be responsible to the amount of Rs. 5000, for the due collection and payment by C of those rents. This is

  1. no guarantee

  2. simple guarantee

  3. continuing guarantee

  4. None of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Option (1) is incorrect: It is an example of continuing guarantee. Option (2) is incorrect: It is not a simple guarantee. Option (3) is correct: A guarantee which extends to a series of transactions is called a 'continuing guarantee'.

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