Abstract

This paper refers to the issue of safeguarding creditor's interests in the event of a merger of its debtor (whether personal or limited) with another entity. The author analyses the consequences of merger for the fate of a mortgage established to secure claims under a surety agreement. Because of the lack of creditor's leverage over the debtor's merger process, the interpretation of the existing rules should not lead to infringement of creditor's rightful interests. Nonetheless, the case of a merger between the surety and the primary debtor (principal) is particularly difficult. Maintaining the mortgage despite the merger leads to the breach of the principle that no one should provide a guarantee for its own debt. Yet, the author presents some arguments that allow for preserving the established mortgages even if the merger between the surety and the principal has come to pass.