Bürgschaft

Bürgschaft is a legal concept found in civil law jurisdictions, particularly prominent in German law, that establishes a collateral obligation undertaken by a third party, known as the guarantor (Bürge), to a creditor. This guarantee is made in favor of the principal debtor (Hauptschuldner) for the performance of an obligation. Essentially, the guarantor promises to pay the creditor if the principal debtor fails to fulfill their contractual duties.

The Bürgschaft is typically an accessory contract, meaning its validity is dependent on the existence of the primary obligation it secures. If the main debt is invalid, the Bürgschaft generally becomes void as well. German law requires the Bürgschaft to be in written form for its validity, a formality designed to ensure clarity and prevent hasty or ill-considered commitments.

There are different types of Bürgschaft, including the "selbstschuldnerische Bürgschaft" (guarantee of self- Schuldner), where the guarantor waives the defense of prior execution against the principal debtor, allowing the creditor to pursue the guarantor immediately upon the principal debtor's default. In contrast, a standard "einfache Bürgschaft" (simple guarantee) may allow the guarantor to raise defenses available to the principal debtor, such as the defense of prior execution.

The purpose of a Bürgschaft is to provide the creditor with additional security, making them more willing to extend credit or enter into contracts. For the guarantor, it represents a significant financial commitment and potential liability, necessitating careful consideration of the principal debtor's financial stability and the terms of the underlying obligation before undertaking such a guarantee.