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Guarantee Agreement for Singapore

Guarantee Agreement Template for Singapore

A Guarantee Agreement under Singapore law is a legally binding document where one party (the guarantor) promises to be responsible for the obligations, debts, or performance of another party (the principal debtor) to a third party (the creditor). The agreement must comply with Singapore's Civil Law Act requirements, including being in writing and signed. It establishes the scope, conditions, and enforcement mechanisms of the guarantee obligation.

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What is a Guarantee Agreement?

A Guarantee Agreement is commonly used in Singapore business transactions where additional security is required for financial or performance obligations. This document, governed by Singapore law, establishes a secondary obligation where the guarantor agrees to fulfill the principal debtor's obligations if they default. The agreement must clearly define the guaranteed obligations, conditions for enforcement, and the extent of the guarantor's liability. It's particularly important in commercial lending, property transactions, and business contracts where creditworthiness or performance assurance is crucial.

What sections should be included in a Guarantee Agreement?

1. Parties: Identification of guarantor, creditor, and principal debtor

2. Background: Context of the guarantee and underlying obligation

3. Definitions: Key terms used throughout the agreement

4. Guarantee and Indemnity: Core obligations of the guarantor

5. Scope of Guarantee: Extent of guaranteed obligations

6. Duration: Term of the guarantee

7. Enforcement: Rights and procedures for enforcement

8. Governing Law: Applicable law and jurisdiction

What sections are optional to include in a Guarantee Agreement?

1. Security: Additional security provisions when guarantee is secured by assets

2. Multiple Guarantors: Joint and several liability provisions when more than one guarantor exists

3. Assignment: Rights to assign the guarantee when assignment rights are needed

4. Corporate Authority: Corporate powers and authorizations for corporate guarantors

What schedules should be included in a Guarantee Agreement?

1. Primary Obligation: Details of the underlying obligation being guaranteed

2. Security Details: Description of any security provided

3. Corporate Authorizations: Board resolutions and corporate approvals for corporate guarantors

Authors

Alex Denne

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

Jurisdiction

Singapore

Publisher

Ƶ

Document Type

Agreement Contract

Cost

Free to use
Relevant legal definitions





























Clauses
































Industries

Civil Law Act (Cap. 43): Primary legislation governing contracts and guarantees in Singapore. Section 6(b) specifically requires guarantees to be in writing and signed to be enforceable.

Contracts (Rights of Third Parties) Act: Governs how third parties may enforce terms of a contract, which is relevant for guarantee agreements involving multiple parties.

Limitation Act (Cap. 163): Sets time limits for bringing legal actions relating to guarantee agreements and other contractual claims.

Unfair Contract Terms Act (Cap. 396): Regulates unfair terms in contracts, including guarantees, particularly regarding exclusion and limitation clauses.

Companies Act (Cap. 50): Relevant for corporate guarantees, defining companies' powers to provide guarantees and directors' duties.

Banking Act (Cap. 19): Applicable when guarantees involve banking transactions or financial institutions.

Consumer Protection (Fair Trading) Act: Protects consumer interests in guarantee agreements where one party is a consumer.

Common Law - Contract Principles: Fundamental principles of contract law including offer, acceptance, consideration, and intention to create legal relations.

Common Law - Doctrine of Consideration: Legal requirement that something of value must be exchanged for the guarantee to be legally binding.

Common Law - Contractual Capacity: Rules determining who has the legal capacity to enter into guarantee agreements.

Common Law - Constructive Notice: Principles regarding what parties are deemed to know or should have known when entering into guarantee agreements.

Writing Requirements: Statutory requirement that guarantee agreements must be in writing and signed to be enforceable under Singapore law.

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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