Commentary

2 Nature of contract

BANKING vol 4(1)
| Commentary

2 Nature of contract

| Commentary

2 Nature of contract

Contracts of borrowing and suretyship are not uberrimae fidei: in normal circumstances a bank is under no obligation to inform a prospective guarantor about the circumstances surrounding the account to be guaranteed1; nor, when it seeks a guarantee from someone who is not its own customer, does it owe a duty of care to explain the terms and legal effects of the guarantee to the prospective guarantor2. However, a transaction between a banker and a surety may be set aside on the grounds of undue influence3. If a guarantor can

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