Legal and Jurisprudential Analysis of the Nature and Subject of Guarantee in Negotiable Instruments (Comparative Study in Iranian Law, Civil Law and Common Law)

The nature and subject of guarantee in negotiable instruments is one of issues of legal systems subject to the Geneva Conventions and the common law systems. In Iranian law, there is different opinion regarding to it and issues arising from it, such as the possibility of claiming damages for loss of value. Based on the results of this research, The main effect of a aval, is an independent guarantee that obliged guarantor, despite the fact that the debt remains with the main debtor and that he bears responsibility of payment, and the subject of the guarantor's obligation is the "payment of the negotiable instrument", which has a financial value in itself. With the refusal or failure of the main obligor to pay the negotiable instruments, this subject is lost from the creditor's wealth, and as a result, it falls on the person who has guaranteed its occurrence and then the guarantor's liability is equal to the value of payment. Therefore, in case of non-payment of the negotiable instruments by the principal obligor, the guarantor must pay the value of the debt at the current price, which in inflationary conditions includes nominal amount of the debt and loss of its value.