Releasing cautioner from liability

Question 1

2 general ways of discharge?

Answer 1

1 - discharge of principle obligation

2- prejudicial conduct (giving time/discharging security/ discharging co-cautioner)

Question 2

discharge of principle obligation caveat? [c]

Answer 2

cautionary obligation will be unaffected by voidness resulting from lack of capacity (Stevenson v Adair)

Question 3

Prejudicial conduct:

giving time [2c]

Answer 3

Richardson v Harvey

Hamilton’s Exr v Bank of Scotland

Question 4

Richardson v Harvey [giving time]

Answer 4

• C legally binds himself not to demand payment when it falls due = prejudicial to rights of CA. Materially alters nature of debt

Question 5

Hamilton’s Exr v Bank of Scotland [giving time]

Answer 5

• Simple failure to press for payment isn’t enough

Question 6

Prejudicial conduct

Discharging RiS [c]

Answer 6

Fleming v Thomson - solicitors forgot