11.8 Rights and duties of the parties

Rights of the indemnity holder

An indemnity holder (i.e. indemnified) acting within the scope of his authority is entitled to the following rights –

(a)Right to recover damages

(b)Right to recover costs

(c)Right to recover sums paid under compromise

Right of Indemnifier

Indemnifier’s rights are similar to those of surety (discussed below)

Where one person has agreed to indemnify the other, he will, on making good the indemnity, be entitled to succeed to all the ways and means by which the person indemnified might have protected himself against or reimbursed himself for the loss. [Simpson v Thomson]

Rights of Surety/Guarantor

Rights of Surety can be classified into three groups, as follows;

• Rights against Principal debtor.
• Rights against Creditor.
• Rights against Co-Sureties.

Rights against principal debtor

1. Right to give Notice
2. Rights of Sub-rogation
3. Right of Indemnity
4. Right to get Securities
5. Right to ask for Relief

Rights against creditor

1. Right to get securities
2. Right to ask for set-off
3. Rights of sub-rogation
4. Right to advice to sue principal debtor
5. Right to insist on termination of services

Rights against Co-Sureties

1. Release of Co-surety
2. Right to contribution