Certain Problems Regarding the Amendment of the Civil and Commeraicl Code in Particular the Law of Guarantee

Abstract

The Thai Civil and Commercial Code had been amended and had come into
effect on February 12, 2015 and July 15, 2015 respectively. The laws had been changed
in various sections relating to guarantee. There are several provisions for lenders,
borrowers and guarantors to comply with. For example, the new laws require the
guarantee agreement must specify the purpose of guarantee, the main contract, the
period of time and the maximum amount of money which is being guaranteed. It aims
to remove the guarantors from being guaranteed in all debts or indefinite period of
time. Next, the new laws have changed the liability of the guarantor as jointly liable
with the borrower. They prevent lenders from requiring guarantors to be jointly liable
with borrowers. Any provision in the guarantee contract which contravene this provision
shall be void and unenforceable. In addition, the new laws also set the processes for
lenders to notify guarantors of the default within 60 days. Failure to notify as above
causes the lenders to lose their rights to claim for any interests, costs and expenses
arising after the 60 day notification period.
After the new law has been effective for almost 3 years, there has been
several problems regarding the amendment. This group paper aims to summarise certain
problems relating to the new laws of guarantee, most of them are practical problems
and still inconclusive. This paper focuses on special types of consumer cases under The
Consumer Case Procedure Act, B.E. 2551 such as leasing agreement and loan agreement
having the installment payments. The paper also provides comments, suggestions and
solutions from both scholars and court decisions for whom may be interest.