Consideration for guarantee and proof of interest claim determine enforceability of surety liability and ancillary recovery.

A guarantee is enforceable only where consideration moves to the principal debtor or a contemporaneous benefit or promise is given for that debtor's advantage; on the stated facts, no fresh cash or new benefit passed when the surety signed, so the guarantee was without consideration and unenforceable. The interest claim also failed because the alleged oral agreement had been disbelieved on evidence and could not be reopened in second appeal; as against the principal debtor, the absence of effective cross-objections in the first appellate court was fatal. Once the surety's liability failed, no interest claim could survive against him. The decree below was left undisturbed.

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Issues: (i) Whether the contract of guarantee executed by the surety was supported by consideration. (ii) Whether the claim for interest was liable to be decreed.

Issue (i): Whether the contract of guarantee executed by the surety was supported by consideration.

Analysis: A guarantee is valid only if something is done or promised for the benefit of the principal debtor so as to furnish consideration to the surety. On the facts found, no cash was advanced at the time of the endorsement and the alleged debt represented only earlier dealings which had already been squared up. Since no fresh benefit moved to the principal debtor when the surety signed the endorsement, the alleged guarantee was not supported by consideration.

Conclusion: The contract of guarantee was without consideration and was not enforceable against the surety.

Issue (ii): Whether the claim for interest was liable to be decreed.

Analysis: The alleged oral agreement regarding interest had already been disbelieved on evidence, and that factual finding could not be reopened in second appeal. As against the principal debtor, the claim was also barred because no effective cross-objections had been served in the first appellate court, and the omission was fatal. In any event, once the surety's liability failed, no claim for interest could survive against him.

Conclusion: The claim for interest was not maintainable against either defendant.

Final Conclusion: The appeal failed on both the enforceability of the suretyship and the claim for interest, and the decree below was left undisturbed.

Ratio Decidendi: Under Section 127 of the Indian Contract Act, 1872, a contract of guarantee requires a contemporaneous benefit or promise for the principal debtor; a subsequent suretyship unsupported by fresh consideration is void.

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