Personal guarantees from Thai company directors
Foreign suppliers and lenders often ask for a personal guarantee from the director of a Thai company before extending credit. The Civil and Commercial Code was amended in 2015 to protect guarantors, and a guarantee drafted to the old pattern may not do what the creditor expects.
Published 23 September 2026
In writing, and naming the debt
Under section 680 of the Civil and Commercial Code, a guarantee cannot be enforced by action unless there is written evidence of it signed by the guarantor. Section 681 then requires the guarantee to state clearly the debt or contract guaranteed, and the guarantor is liable only for that. A guarantee of future or conditional debts must state the purpose of the debts guaranteed, their nature, the maximum amount guaranteed and the period in which they may be incurred, though a continuing guarantee under section 699 may omit the period.
A director cannot be made a joint debtor
Section 681/1 makes void any term requiring a guarantor to be liable in the same way as a joint debtor or as a joint debtor. The exception is a guarantor that is a juristic person and agrees to be bound as a joint debtor, which then loses the defences in sections 688, 689 and 690. A director guaranteeing personally is therefore liable as a guarantor, whatever the form says; a parent or group company can agree to be bound as a joint debtor.
What counts as a joint-debtor term
Not every strongly worded guarantee is caught. In judgment 8881/2568 the guarantor agreed to be liable for the debtor's obligations in full; the Supreme Court held that this was a guarantee within section 680, not a joint-debtor term, and it was not void. In judgment 2278/2567 a guarantee form carried a joint-debtor clause expressly limited to guarantors that were juristic persons; the individual guarantors who signed it were not bound by that clause, their guarantee was not void, and they were liable as guarantors.
Guarantees signed before 12 February 2015
The joint-debtor ban does not reach back. Section 18 of the Act amending the Civil and Commercial Code (No. 20) B.E. 2557 provides that the Act does not affect contracts made before it came into force unless it provides otherwise, and it makes no such provision for section 681/1, as the Supreme Court held in judgment 5788/2562. In judgment 160/2566 the Court gave the Act's date of entry into force as 12 February 2015 and held that a joint-debtor term in guarantees signed on 29 October 2014 remained enforceable. The notice rule in the new section 686 is different: section 19 of the Act applies it from the date the Act came into force. In judgment 5788/2562 the guarantee had been signed in 2013, but the debtor defaulted in July 2015, and the Court applied section 686. The date on the guarantee is therefore the first thing to check, and the date of default the second.
The guarantor's defences
An individual guarantor keeps three defences. Under section 688, when the creditor demands payment, the guarantor may ask that the debtor be called on to pay first, unless the debtor has been adjudged bankrupt or its whereabouts in the Kingdom are unknown. Under section 689, even after that, if the guarantor proves that the debtor has the means to pay and that enforcing against it would not be difficult, the creditor must enforce against the debtor's property first. Under section 690, where the creditor holds property of the debtor as security, the creditor must, at the guarantor's request, look to that security first.
Terms that cannot be contracted out of
Section 685/1 makes void any term of a guarantee that departs from the first three paragraphs of section 681, or from sections 686, 694, 698 or 699. One of those is the creditor's duty under section 686 to notify the guarantor in writing within sixty days of the debtor's default; if it does not, the guarantor is released from interest, damages and charges arising after that period.
Ending a continuing guarantee
A guarantee of a continuing series of transactions without a time limit can be ended for the future. Under section 699 the guarantor may revoke it by notice to the creditor, and is then not liable for transactions the debtor enters into after the notice reaches the creditor. A creditor extending further credit on the strength of such a guarantee should therefore watch for that notice.
The judgments this rests on
Supreme Court judgment 8881/2568
A guarantor's agreement to be liable for the debtor's obligations in full is a guarantee under section 680, not a joint-debtor term under section 681/1, and is not void.
Supreme Court judgment 2278/2567
A joint-debtor clause limited to guarantors that are juristic persons does not bind individual guarantors; their guarantee is not void and they are liable as guarantors.
Supreme Court judgment 5788/2562
Amendment Act No. 20 B.E. 2557 does not affect contracts made before it came into force unless it provides otherwise (section 18), so a joint-debtor term in a 2013 guarantee remained enforceable; the new section 686 applied because the debtor defaulted after the Act came into force (section 19).
Supreme Court judgment 160/2566
A joint-debtor term in guarantees signed on 29 October 2014, before Amendment Act No. 20 came into force on 12 February 2015, remained enforceable.
Questions this raises
Can we require a director to be liable as a joint debtor?
Not an individual. Section 681/1 makes such a term void. Only a guarantor that is a juristic person can agree to be bound as a joint debtor, and it then gives up the defences in sections 688 to 690.
Our guarantee was signed in 2013 and makes the director a joint debtor. Does it still work?
The joint-debtor ban does not affect contracts made before the amendment came into force (section 18 of Amendment Act No. 20; judgment 5788/2562), and in judgment 160/2566 a joint-debtor term in guarantees signed in October 2014 remained enforceable. The sixty-day notice rule in section 686 still applies if the company defaulted after the Act came into force (section 19; judgment 5788/2562).
Can the director insist that we pursue the company first?
The director can ask that the company be called on to pay first under section 688, and under section 689 can require the creditor to enforce against the company's property first by proving it has the means to pay and that enforcement would not be difficult.
The legislation
- Civil and Commercial Code, sections 680, 681 and 681/1
- Civil and Commercial Code, sections 685/1, 686 and 699
- Civil and Commercial Code, sections 688, 689 and 690
- Act Amending the Civil and Commercial Code (No. 20) B.E. 2557 (2014), sections 18 and 19
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