Does the running of the statute of limitations as to the principal debtor exonerate the surety?
California, United States of America
The following excerpt is from Great American West, Inc. v. Safeco Ins., 226 Cal.App.3d 1145, 277 Cal.Rptr. 349 (Cal. App. 1991):
5 A similar analysis distinguishes the court's decision in Regents of University of California v. Hartford Acc. & Indem. Co. (1978) 21 Cal.3d 624, 147 Cal.Rptr. 486, 581 P.2d 197 holding that the running of the statute of limitations as to the principal debtor does not exonerate the surety, whose payment gives it a new right of reimbursement against the debtor. (Id. at pp. 634, 638, 147 Cal.Rptr. 486, 581 P.2d 197.)
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