Home › CA Foundation › businesslaw › Contract of Indemnity and Guarantee › Under Section 124, a 'contract of indemnity' is …
Under Section 124, a 'contract of indemnity' is one by which a party promises to save the other from loss caused:
AOnly by an act of God
BOnly by the promisee's own negligence
CBy the conduct of the promisor himself or of any other person
DBy any cause whatsoever including accidents
Answer & Solution
Correct answer: C. By the conduct of the promisor himself or of any other person
Section 124 limits indemnity to loss caused by the conduct of the promisor or of any other person; loss by an act of God or accident is outside it.
Related questions
Under Section 146, in the absence of a contrary agreement, co-sureties for the same debt aUnder Section 141, a surety is entitled to the benefit of every security the creditor holdOn paying the guaranteed debt, the surety acquires all the rights the creditor had againstUnder Section 139, if the creditor does an act inconsistent with the surety's rights, or oUnder Section 137, mere forbearance by the creditor to sue the principal debtor:Under Section 135, a contract by which the creditor compounds with, gives time to, or promUnder Section 134, the surety is discharged when the creditor:Under Section 133, a variance in the terms of the contract between creditor and principal