Explanation of Article 591

Explanation of Article 591

The article refers to the provisions related to the debtor's recourse against the guarantor and execution on his assets. The first paragraph establishes two rules:

The first rule: The creditor does not have the right to revert to the guarantor alone unless he has first reverted to the debtor.

The second rule: The creditor does not have the right to execute on the guarantor's assets unless the debtor has been stripped of his assets.

The paragraph also clarifies that this rule applies on the condition that the guarantor is not jointly liable with the debtor, whether the guarantor's joint liability with the debtor is stipulated or by the system's ruling. If it is stipulated in the guarantee that the guarantor is jointly liable, he cannot argue that the creditor must first revert to the debtor, nor can he argue for stripping the debtor of his assets.

The legislator chose this approach in determining the article's ruling, taking into account several considerations, including:

1. This approach is closest to fulfilling the contracting parties' will, especially the guarantor when his joint liability is not stipulated; as the guarantee by nature requires the existence of two obligations of varying rank, primary and secondary; thus, the secondary should not be fulfilled before the primary.

2. The guarantor's interest in fulfilling the obligation does not surpass the debtor's interest; it is unjust to execute on the former before the latter. If the creditor wishes to strengthen the guarantor's position, he can stipulate joint liability; thus, the guarantor enters the contract fully aware and chooses to waive this defense himself.

3. The guarantee is based on the guarantor's voluntary act; it is not appropriate for him to fulfill a debt that is not his own before the debtor, who benefits from the debt.

4. This approach simplifies litigation procedures by directly demanding the debtor instead of demanding the guarantor, who would then revert to the debtor.

The second paragraph clarifies that the court does not, on its own initiative, rule for the necessity of reverting to the debtor before reverting to the guarantor, nor for not executing on the guarantor's assets unless the debtor has been stripped of his assets. Instead, the guarantor must assert this defense.

It is clear from the article's text that the guarantor has two types of defenses against the creditor:

The first defense: The defense of the necessity to revert to the debtor first.

The second defense: The defense of stripping the debtor.

Each of these defenses is independent of the other, and each has its conditions. The first is applicable when demanded, and the second is applicable when executing on the guarantor's assets. Below are the conditions for each:

The first defense: The defense of the necessity to revert to the debtor first:

This defense requires five conditions:

The first condition: The guarantor must not be jointly liable; if it is stipulated in the guarantee contract that he is jointly liable with the debtor, this defense is not applicable.

The second condition: The creditor must revert to the guarantor alone. If the creditor reverts to the debtor, or to both the debtor and the guarantor together, this defense is not applicable.

The third condition: The guarantor must not have waived his right to this defense; this right is established for his benefit, so he can waive it explicitly or implicitly in the guarantee contract or thereafter.

The fourth condition: The creditor's recourse to the debtor must be worthwhile; if the debtor is insolvent or evidently unable to fulfill the debt, having no assets to execute upon, there is no point in asserting this defense; the burden of proving the futility of reverting to the debtor lies with the creditor.

The fifth condition: The guarantor must assert this defense at any stage of the lawsuit; the court cannot rule on it on its own initiative.

If the five conditions are met, the debtor's assertion of this defense is valid, and the creditor, if he has not filed a lawsuit against both the debtor and the guarantor together, must revert to the debtor by demanding him judicially; or warning him to fulfill if the creditor has an enforceable document; or the creditor must proceed with collective liquidation procedures of the debtor's assets if he is bankrupt, as the creditor cannot take individual actions.

Related To

Article 591

1. A creditor may not exercise the right of recourse against the surety except after exercising such right against the debtor, nor may he proceed against the surety’s property except after availing the surety the benefit of discussion, unless the surety is a solidary debtor.

2. The court shall not enforce the provision of paragraph (1) of this Article, unless the surety invokes his right in both cases.