Discharge of surety by release or discharge of principal debtor

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....the legal consequence of which is the discharge of the principal debtor. Illustrations .(a) A gives a guarantee to C for goods to be supplied by C toB.C supplies goods to B, and afterwards B becomes embarrassed and contracts with his creditors (including C) to assign to them his property in consideration of their releasing him from their demands. Here B is released from his debt by the contract ....