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Art. 506

220COFederal ActJan 1, 1912Original source

The surety may require that the principal debtor furnish security and demand his release from liability once the principal obligation falls due:

  1. where the principal debtor breaches the agreements made with the surety, and in particular his promise to release the surety by a certain date;
  2. where the principal debtor is in default or has relocated his domicile abroad and legal action against him in foreign courts has been substantially impeded as a result;
  3. where the surety faces substantially greater risks than when he agreed to offer the surety because of a deterioration in the principal debtor’s financial situation, a decrease in the value of the security furnished or the fault of the principal debtor.

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