Multiple choice

Which of the following statements is correct?

  1. Past consideration is no consideration for a contract of guarantee.

  2. Forbearance to sue on the part of the creditor is a good consideration for a guarantee.

  3. A contract of guarantee is a contract of absolute good faith.

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

(2) The creditor’s forbearance from suing the principal may amount to good consideration to support a gurantee.

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