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Simple English definitions for legal terms
suit to compel payment
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A quick definition of suit to compel payment:
A suit to compel payment is a legal action taken by a surety to force a debtor to pay their outstanding debt to a creditor. This type of lawsuit is typically brought in equity court and may include additional remedies if the debtor has acted fraudulently or is insolvent. The goal of a suit for exoneration is to ensure that the debtor's assets are applied fairly to their outstanding obligations.
A more thorough explanation:
Definition: A suit in equity brought by a surety to compel the debtor to pay the creditor. If the debtor has acted fraudulently and is insolvent, a suit for exoneration may include further remedies to ensure that the debtor's assets are applied equitably to the debtor's outstanding obligations.
Example: John borrowed $10,000 from the bank and his friend Tom acted as a surety for the loan. John failed to repay the loan, and the bank demanded payment from Tom. Tom can file a suit to compel payment against John to recover the amount he paid to the bank on John's behalf.
Explanation: In this example, Tom acted as a surety for John's loan, and when John failed to repay the loan, the bank demanded payment from Tom. To recover the amount he paid to the bank on John's behalf, Tom can file a suit to compel payment against John.