The difference between surety bond contract and independent guarantee contract

Article 1936 of the Civil Code defines a guarantor as one who personally obligates himself to a creditor and guarantees the obligation of others, regardless of whether the principal debtor is aware of his commitment.

The surety bond is, therefore, a typical contract that is characterized by the existence of an ancillary link between the principal relationship and the guarantee relationship under which the guarantor can oppose all the exceptions that are due to the principal debtor, except those arising from incapacity (Art. 1945 Civil Code). The guarantor is jointly and severally obligated with the principal debtor to pay the debt, being able to exercise his right of recourse against him and, also, being able to be subject to the opposition of exceptions by the same debtor in the cases provided for in Article 1952 Civil Code.

The autonomous contract of guarantee, on the other hand, is an atypical contract arising out of international commercial practice and is characterized by the absence of any ancillary bond, which connotes, in contrast, the surety bond. The guarantor, therefore, undertakes to hold the guarantor harmless through the performance of a performance that is additional to and different from the principal performance and, consequently, will not be able to assert the defenses that would accrue to the principal debtor.

It should be pointed out that, in the face of the above, the guarantor may also avail himself of only the so-called exceptio doli whenever the creditor has acted with malice in order to induce the guarantor to conclude the transaction, subsequently demanding the fulfillment of the underlying performance. In other words, the autonomous guarantor's obligation is different from the guaranteed obligation and not necessarily overlapping with the latter, because it is not aimed at the performance of the principal obligation, but, rather, at indemnifying the dissatisfied creditor with the timely payment of a predetermined sum of money.

Therefore, "the concrete cause of the autonomous guarantee contract is to transfer from one party to another the economic risk associated with the non-performance of a contractual performance, while with the surety bond the interest in the exact performance of the same principal performance is protected."
In the autonomous guarantee contract, therefore, it is necessary to absolutely exclude the possibility for the guarantor to raise the defenses of the guaranteed debtor, both at the stage of performance and at a later stage, such as, for example, the repayment of what has been paid. From this clarification, the contract will qualify as autonomous and thus freed from the ancillary character.
Clearly, the process of identifying the type of contract should not be limited to the presence of a precise clause. On the contrary. The agreement must be evaluated and analyzed in its total content, linking the clauses together and evaluating them in concert so that the real will of the parties can be identified. For this reason, the court could also assign a qualification other than that conferred by the parties.

The index clauses

What, then, are the clauses that enable the identification of one contractual case over another?

• "On first demand" or "on demand in writing"
• "Every exception removed," "without exception"
• "To pay immediately, even if the debtor objects"

How to define whether the agreement we are entering into is a surety bond or an independent guarantee contract?

Let us conclude by saying that, first of all, the autonomy of the guarantee must be sought in the relationship between guarantor and guarantor, so that towards the latter no exceptions can be raised instead by the principal debtor. There must, therefore, be a willingness on the part of the parties to create a commitment released from the principal relationship, lacking the aforementioned character of ancillary nature.
In any case, the above clauses should be read in conjunction with the context in which they are included, but if present they primarily connote a stand-alone security agreement. Otherwise, clauses referring to the timing of performance, such as "on first demand" or "upon simple written request" or even "immediately," do not qualify the contract type because they are compatible with both.