Fact Pattern 19-1
Petro Oil Refinery asks Quality Bank for a loan to increase its oil inventory. Quality requires Robin, Petro's president, sign a personal guaranty to pay the debt if Petro defaults. Meanwhile, to sell fifty barrels of refined oil to Slick Lubricants, Inc., Petro asks its outside accountant Tina to co-sign a credit application.
-Refer to Fact Pattern 19-1.If Tina signs the application but fails to condition her signature on Petro's agreement to pursue its legal remedies against Slick before looking to her, then Tina is
A) a surety.
B) a lienor.
C) a guarantor.
D) a creditor.

Question

Fact Pattern 19-1
Petro Oil Refinery asks Quality Bank for a loan to increase its oil inventory. Quality requires Robin, Petro's president, sign a personal guaranty to pay the debt if Petro defaults. Meanwhile, to sell fifty barrels of refined oil to Slick Lubricants, Inc., Petro asks its outside accountant Tina to co-sign a credit application.
-Refer to Fact Pattern 19-1.If Tina signs the application but fails to condition her signature on Petro's agreement to pursue its legal remedies against Slick before looking to her, then Tina is​
A) ​a surety.
B) ​a lienor.
C) ​a guarantor.
D) ​a creditor.

Quizplus · Accepted Answer

Tina is a surety because she co-signs the credit application without conditioning her liability, meaning she is equally responsible for the debt if Petro defaults.

Fact Pattern 19-1 Petro Oil Refinery Asks Quality Bank for a Loan to a Loan