In suretyship, what is the right of recovery of the surety limited to?

In suretyship, the right of recovery of the surety is fundamentally considered to be full and complete recourse against its principal. This means that when a surety has paid a claim, they have the authority to seek reimbursement from the principal for the amount paid out, as well as any associated costs incurred during the process.

This concept stems from the foundational principles of suretyship. A surety essentially stands as a guarantor for the principal's obligations. If the principal defaults on fulfilling their duties, the surety pays the obligation to the obligee (the party to whom the obligation is owed) and subsequently has the right to recover the full amount disbursed from the principal. This recourse ensures that the surety can protect its financial interests and encourages the principal to comply with their obligations, knowing that there are financial repercussions for noncompliance.

The other choices either suggest limited recourse or specific circumstances that do not align with the broader legal framework governing surety agreements. Full and complete recourse is a critical aspect of suretyship, reinforcing the responsibilities of the principal and the financial security provided to the obligee.