Indemnity Agreement In Nigeria

When a creditor wishes to make a third party personally liable for the debtor`s obligations, he or she has the choice of granting a guarantee or compensation. Below we will discuss the nature of a warranty contract and how it differs from that of a compensation contract. The benefits of a compensation clause as a negotiated compensation mechanism are as follows: as noted above in this document, the obligation for a surety is to obtain that the debtor meets its obligations. For this reason, the creditor has the right in principle to sue the guarantor without asserting his rights against the debtor. The liability of the surety is secondary to that of the principal debtor. Unless the guarantee contract is otherwise provided, the creditor is excluded from taking action against the surety until the principal debt is due. Therefore, if the debt is only due if the debtor makes a claim, the creditor must first do so before answering the bond. As a general rule, guarantees should only be paid against the guarantor „on request.“ This means that even if the underlying transaction is deferred for any reason, the compensation remains valid. Overtime has been the subject of several proposals regarding the type of contractual compensation. These proposals include: This obligation to compensate you (the „customer“) in favour of FBNQUEST ASSET MANAGEMENT LIMITED, a limited liability company established at 16, Keffi Street on Awolowo Road S.W.

Ikoyi, Lagos State (hereafter referred to as „company“),) which, if the context permits, must include its rights holders. Another possibility is that the creditor may receive compensation by which a third party agrees to compensate the creditor for all losses (direct/indirect) incurred by the creditor as a result of the conclusion of the above transaction with the debtor. The liability resulting from compensation is, by its nature, only for a specified amount, but an action can be brought before the determination of liability. Therefore, the obligation to compensate may arise before the date on which the beneficiary suffered a loss or injury. „guarantee“: a generic term comprising guarantee commitments issued by a third party (the guarantor) on behalf of a debtor (the awarding power) in favour of the contractual commitment (of the creditor) to guarantee an underlying contractual obligation2 against an identified risk. The obligations of the surety generally consist, but not exclusively, of a security guarantee contract and may, depending on the context in which the company was granted and the proper construction of the bonds of the bond, give rise to primary liability obligations („compensations“) „or secondary („guarantee“). The compensation clause is included in the contract of sale by the buyer on a temporary basis against the seller, in order to preserve his interest in future third-party claims or the revenue generated by this case. It also deals with unknown debts and strengthens the agreement as you know your limitation of liability. Kolawole Mayomi, partner S.P.A. Ajibade and Co in his article „Enforcement of Guarantees and Indemnities: Problems Arising“ provides an in-depth analysis of the Safeguards and Compensation Act. It notes that, although the law on guarantee and compensation contracts is on a case-by-case basis in Nigeria, the courts have mixed the principles underlying them.

The consequences are the opening of a guarantor to unconditional liability or the imposition of an incriminating obligation on the creditor who holds a compensation contract. It examines how risks are covered, the diversity of guarantee and compensation contracts and their opposition to the implementation of each.