If the promissor's liability depends upon the performance of some other event, or the meeting of some other contingency, other than the performance by the principal of his contract, the guaranty is said to be a conditional guaranty. The guaranty is styled an absolute guaranty when the default of the principal fixes the liability of the guarantor. An indorsement of a promissory note, in the form of a guaranty, is the most common form of the absolute guaranty.10

Conditions of demand on the principal, or notice of default, ordinarily are not a part of the contract of the absolute guarantor.

The most lucid example of a conditional guaranty is in the case of the guaranty of the collectibility of note or other indebtedness. In such a case, it is essential that something be shown beyond the mere default of the principal. The creditor must show due diligence in an endeavor to collect, which is the condition of the guarantor's contract, and unless this condition of the contract is met, then the guarantor is exonerated. The creditor must usually show that the demand cannot be collected by legal proceedings, that is, by instituting suit, securing a judgment, and by having a return showing execution on the judgment can not be made, as the creditor is bound also to enforce the legal remedies given him against the debtor.11 Any form or words that fairly import the condition that the creditor shall first exhaust his remedies against the principal debtor, is sufficient to make the guaranty a conditional one, as for instance where the language is "I warrant this note good." 12

8 Gay vs. Ward, 67 Conn., 147.

9 Pond vs. U. S., 1ll Fed. Rep., 989.

10 Gage vs. Mechanics Natl. Bank, 79 I11., 62.