Fact Pattern 28-1B
Beta Software Corporation is a new company that needs to borrow money to meet its payroll. Cliff, president and owner of Beta, asks First National Bank to loan Beta the funds.
-Refer to Fact Pattern 28-1B. Generally, for a contract between First National and Cliff with respect to liability for Beta's loan to be enforceable, it must be in writing if Cliff is
A) a guarantor and a surety.
B) a guarantor only.
C) a surety only.
D) neither a guarantor nor a surety.

Question

Fact Pattern 28-1B 
Beta Software Corporation is a new company that needs to borrow money to meet its payroll. Cliff, president and owner of Beta, asks First National Bank to loan Beta the funds.
-Refer to Fact Pattern 28-1B. Generally, for a contract between First National and Cliff with respect to liability for Beta's loan to be enforceable, it must be in writing if Cliff is
A) a guarantor and a surety.
B) a guarantor only.
C) a surety only.
D) neither a guarantor nor a surety.

Quizplus · Accepted Answer

A guarantor is primarily liable for the debt, while a surety is secondarily liable. A contract for a loan that is guaranteed by a guarantor must be in writing to be enforceable.