Virginia Code

Va. Code Ann. § 49-26 (2026)

Effect of failure of creditor to sue

✓ current as of May 2026

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If such creditor, or his committee or personal representative, shall not, within thirty days after such requirement, institute suit against every party to such contract who is resident in this Commonwealth and not insolvent and prosecute the same with due diligence to judgment and by execution, he shall forfeit his right to demand of such surety, guarantor or endorser or his estate, and of his cosureties and their estates, the money due by any such contract for the payment of money, or the damages sustained by any breach of the collateral condition or undertaking specified as aforesaid; but the conditions, rights and remedies against the principal debtor shall remain unimpaired thereby.

Code 1919, § 5775; 1979, c. 664.

Notes of Decisions

Cited in 7 cases, 1978–1996 · leading case: Courson v. Simpson, 468 S.E.2d 17 (Va. 1996).

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Courson v. Simpson, 468 S.E.2d 17 (Va. 1996). · cites it 86× “The court held that, because the sole principal debtor on the note was insolvent, Code § 49-26 did not release the Coursons from their obligation under the deed of trust.”

Colonial Am. Nat'l Bank v. Robert L. Kosnoski, 617 F.2d 1025 (4th Cir. 1980). · cites it 6× “Va.Code § 49-26 (1974). There are no material factual differences here; decision hinges upon the construction of the statutes.”

Gary Green v. Maurice P. Foley, Gary Green v. Maurice P. Foley, 856 F.2d 660 (4th Cir. 1988). “See Va.Code Ann. § 49-26 (1986) (after demand by surety, if creditor does not institute suit against solvent parties to contract “and prosecute the same with due diligence,” creditor forfeits right to demand payment from surety).”

Colonial Am. Nat'l Bank v. Kosnoski, 452 F. Supp. 135 (W.D. Va. 1978). · cites it 2× “The court must look to the Code of Virginia § 49-25 1 and § 49-26 2 to determine if CNB’s failure to sue releases Kosnoski from liability as a guarantor.”

P & T Enter., L.L.C. v. Commonwealth Sur. Assocs., Ltd., 39 Va. Cir. 286 (Richmond County Cir. Ct. 1996). · cites it 3× “In addition, § 49-26 of the Code does not effect a release when the debtor is insolvent.”

Courson v. Simpson, 37 Va. Cir. 497 (Fairfax Cir. Ct. 1987). · cites it 31× “Va. Code § 49-26, entitled “Effect of failure of creditor to sue,” provides that if the creditor fails to bring suit against the principal debtor within thirty days of the written requirement to sue issued by the surety, the surety is discharged.”

Dominion Bank v. Dominion Grp. I Ltd. P'ship, 27 Va. Cir. 388 (Fredericksburg Cir. Ct. 1992). “First, the 1988 guaranty executed by the Tooles is an unconditional guaranty of payment, in which the Tooles "xpressly waive their rights under § 49-25 and § 49-26 and agree that the Bank can proceed against them, upon default, without resorting to any other security or…”

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