Entrepreneurs undertook to repay the debt of a company that had taken financing from the bank. A debt settlement was executed between the bank and the company, under which it was determined that the bank must realize the collaterals it has, that if they are not sufficient to cover the entire debt, the debt shall be repaid from apartments in the project and only after that are the entrepreneurs obligated to repay the remaining debt.
The Court held that the obligation is an indemnity and therefore the fact that the debt was reduced does not mean that their obligation is also reduced. When an obligation is classified as a guarantee, the provisions of the law shall apply, including the fact that if the debtor's obligation is reduced, the guarantor's obligation is also reduced. However, an indemnity is an independent obligation that is separated from the relationship between the debtor and the creditor. The classification is made based on the degree of the obligation's independence, the date the obligation comes into effect and the content of the obligation. Here, the obligation is an independent one that the entrepreneurs assumed independently of the bank's granting the loan. In terms of the date of the obligation, it was created after the debt settlement. In terms of the content of the obligation, the entrepreneurs did not undertake to pay the remaining debt, but to compensate the bank for the remaining debt balance, after the conditions set out in the debt settlement have been met. Therefore, the obligation is an indemnity and not a guarantee, and the entrepreneurs must pay the full amount to which they committed.