A Treatise On Guaranty Insurance And Compensated Suretyship, Including Therein As Subsidiary Branches the Law of Fidelity, Commercial And Judicial Insurances, Covering All Forms of Compensated Suretyship, Such As Official And Private Fidelity Bonds, Build

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On the other hand, in general, contracts of guaranty are between per- sons who occupy or ultimately assume the positions of creditors, debt- ors and surety, and thereby the surety becomes bound to pay the debt or make good the default to the debtor. In general, the creditor does not himself go to the surety, or represent or explain to the surety the risk to be run. The surety often takes the position from motives of friendship to the debtor, and generally not on the result of any direct bargain
...ing between him and the creditor, or in consideration of any remuneration passing to him from the creditor. The risk under- taken is generally known to the surety, and the circumstances gen- erally point to the steps that, as between the creditors and the surety, it was contemplated and intended that the surety should take to ascertain exactly what risk he was taking on himself. In all the re- ported cases of guaranty that I have been able to find in which it has been held that the party guaranteed owed no duty to the guarantor as to disclosure of material facts, the contracts when examined are found to have in substance, though of course not in every detail, the characteristics which distinguish contracts of guaranty from contracts of insurence, as above stated.

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