Suretyship Agreement for Switzerland

Suretyship Agreement Template for Switzerland

A Suretyship Agreement under Swiss law is a formal legal document where a surety (guarantor) commits to answering for the debt, default, or miscarriage of another party's obligations to a creditor. Governed by Articles 492-512 of the Swiss Code of Obligations, this agreement requires strict formal requirements, including written form and, in many cases, notarization. The document must explicitly state the maximum amount of liability and includes specific provisions for the protection of the surety, particularly when the surety is an individual. The agreement details the scope of secured obligations, payment conditions, and termination rights while complying with Swiss consumer protection regulations where applicable.

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What is a Suretyship Agreement?

The Suretyship Agreement is a critical legal instrument in Swiss commercial and financial transactions, used when a third party (the surety) agrees to guarantee the obligations of a debtor to a creditor. This document type is especially common in banking, commercial lending, and corporate transactions where additional security is required. The agreement must strictly comply with Swiss law requirements, particularly Articles 492-512 of the Swiss Code of Obligations, which mandate specific formal requirements including written form and maximum liability amounts. A Suretyship Agreement typically includes detailed provisions about the secured obligations, conditions for calling on the security, and the surety's rights and obligations. Special attention must be paid to consumer protection provisions when the surety is an individual, including mandatory spousal consent requirements for married sureties.

What sections should be included in a Suretyship Agreement?

1. Parties: Identification of the Surety, the Creditor, and the Principal Debtor with full legal names and addresses

2. Background: Context of the suretyship, reference to the primary obligation, and relationship between parties

3. Definitions: Key terms used in the agreement, including 'Secured Obligations', 'Maximum Liability Amount', and 'Security Period'

4. Scope of Suretyship: Clear definition of the secured obligations and explicit statement of the maximum amount of liability as required by Swiss law

5. Surety's Obligations: Details of the surety's payment and performance obligations, including conditions for payment

6. Representations and Warranties: Surety's confirmations regarding capacity, authority, and understanding of obligations

7. Duration and Termination: Term of the suretyship and conditions for termination in accordance with Swiss law

8. Demands and Payments: Process for making demands under the suretyship and payment mechanisms

9. Preservation of Rights: Creditor's rights preservation and waiver of surety's defenses

10. Notices: Communication requirements and contact details for formal notices

11. Governing Law and Jurisdiction: Confirmation of Swiss law governance and jurisdiction for disputes

What sections are optional to include in a Suretyship Agreement?

1. Spousal Consent: Required when the surety is married, per Article 494 of Swiss Code of Obligations

2. Multiple Sureties: Provisions for cases where more than one surety is providing security

3. Counter-Indemnity: Provisions for surety's right of recourse against the principal debtor

4. Assignment and Transfer: Provisions allowing/restricting transfer of rights under the agreement

5. Costs and Expenses: Allocation of costs related to preparation and enforcement of the suretyship

6. Independent Advice: Confirmation that the surety has received independent legal advice, recommended for consumer sureties

What schedules should be included in a Suretyship Agreement?

1. Primary Obligation Details: Details of the main obligation being secured (e.g., loan agreement, credit facility)

2. Maximum Liability Calculation: Breakdown of the maximum liability amount including any interest and costs

3. Form of Demand: Template for making valid demands under the suretyship

4. Secured Obligations: Detailed list of all obligations covered by the suretyship

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Switzerland

Publisher

Genie AI

Document Type

Agreement Contract

Cost

Free to use
Relevant Industries

Banking and Financial Services

Real Estate

Construction

Manufacturing

Commercial Lending

Corporate Finance

Small and Medium Enterprises

Retail

Professional Services

Import/Export

Relevant Teams

Legal

Finance

Risk Management

Compliance

Treasury

Credit Administration

Commercial Operations

Corporate Secretariat

Contract Management

Business Development

Relevant Roles

Legal Counsel

Corporate Lawyer

Financial Director

Credit Risk Manager

Compliance Officer

Contract Manager

Chief Financial Officer

Banking Relationship Manager

Credit Officer

Treasury Manager

Risk Assessment Officer

Legal Operations Manager

Commercial Director

Notary Public

Corporate Secretary

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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