Deed of indemnity for guarantee
- Solicitor approved
- Plain English makes editing easy
- Guidance notes included
- Money back guarantee
About this document
This is a short, solicitor drawn agreement that enables a guarantor to impose a legal obligation on the person he or she has guaranteed. Either party can be an individual or a company.
An indemnity does not protect the guarantor from his fulfilling his or her guarantee in any way if called. Instead, it simply gives him or her a legal basis for seeking damages from the person or company he or she has guaranteed.
This document can be used in many circumstances. The most common use is where a director has personally guaranteed a debt or an obligation of his or her company. If the company reneged on its promise and the guarantee was called, the director could use this agreement to claim against the company as an unsecured creditor.
The two directors of a company agree that the company may enter into a hire agreement to lease a company car for director A as an employee benefit. Director B signs a personal guarantee for the hire agreement, but does not realise that A has intentionally not done so. B discovers the position and insists that A signs this indemnity agreement so that A is legally bound to make good to B if the leasing company calls on the guarantee.
A group of companies is being restructured. Subsidiary XYZ is to be sold and a buyer has been found. However, the buyer is concerned at the level of debt in the company. The seller agrees to indemnify the buyer, using this agreement, if XYZ fails to meet its debt obligations due in next 12 months.
Note that this is a more efficient way to deal with the circumstances than for the seller to agree to guarantee the debts. Firstly, the dubious solvency of XYZ will remain unknown to a creditor because there is no change in ownership that would alert him to it, and secondly, because if the indemnity is called, the cash will go to the buyer and not to XYZ.
The law in this document
There is no statute law that relates to indemnities. This document is based on common contract law.
Net Lawman also offers other document templates for guarantees and indemnities.
This document was written by a solicitor for Net Lawman. It complies with current English law.
"I was really pleased with my recent experience of using Net Lawman. I was able to obtain important legal documents, needed to support my small business. Net Lawman understood my needs and provided fast and efficient service without incurring the significant costs of a traditional law firm. I would both recommend and use Net lawman again"Shireen Arthur
"If only everything was as reliable as NetLawman. We have used them on numerous occasions & they deliver without fail. Whether we require off the shelf legal documents, bespoke contracts or even ad hoc advice they are there for us. It is like having our own legal team but without the costs that this would entail. Pickaweb has no hesitation in recommending NetLawman as one of our best suppliers."Pilar Torres Wahlberg
"Great to be able to download and use a variety of legal documents for all types of lettings."Christopher st james