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Overcame negative jurisprudence in a dispute over the term of a surety bond

Our principal was a creditor of a citizen who had become bankrupt. The creditor's claim was based on a surety agreement.

Initially, the court refused to include this claim on the debtor's creditor claims register. The bankrupt stated that the suretyship agreement was terminated the day after it was concluded. Consequently, he has no debt to our trustee.

We sought reinstatement of the surety, but in that dispute the debtor disclosed that he had sent our client a termination letter more than three years ago. This circumstance created a threat that the statute of limitations would apply.

However, we proved that the defendant's actions were in bad faith. The letter with which the notice was allegedly sent did exist, but its contents did not relate to the surety agreement. So there was no notice of termination either.

In addition, the defendant argued that the surety had terminated anyway, even if the contract had not been terminated. However, this argument was abused as well.

Although the court practice on such disputes is generally negative, we managed to overcome this approach. The court agreed that in our case the suretyship had not expired and the statute of limitations had not expired.