Indian Contract Act Section 147 — Liability of co-sureties bound in different sums

CHAPTER VIII OF INDEMNITY AND GUARANTEE

Commercial / Corporate

Summary

Co-sureties who have each guaranteed different amounts are still required to contribute equally, but only up to the maximum amount each one has agreed to pay. For example, if one co-surety is bound for a smaller sum and another for a larger sum, they share the loss equally, but neither has to pay more than the limit of their own obligation. Each co-surety remains responsible for the full amount they individually promised under their bond.

Official Text

Co-sureties who are bound in different sums are liable to pay equally as far as the limits of their respective obligations permit. Illustrations to the extent of 70,000 rupees. A, B and C have to pay each the full penalty of his bond.