The set of valid legal defenses for the surety holder by commercial law includes:
- Illegality of suretyship contract
- Surety's incapacity etc
What is a surety?
In legal practice, this refers to a guaranty involving a promise by a party who has assume a responsibility for the debt obligation of a borrower if that borrower defaults.
Here, there is little defense for the surety holder because the responsibility has been held by him/her on the loan, thus, the bank that gave the loan to the nephew has a higher chance of recovering then loan from him.
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