Samra had agreed to guarantee a loan of $50 000 that her brother, Amman, had received from the Bank of Vancouver. Amman had entered into a general security agreement with the bank giving it a security interest in all his personal property, which included several vehicles and some jewellery. After Amman had paid back $25 000, he approached the bank asking for permission to sell one of his rings to a friend for $5000. He convinced the bank that his remaining personal property would be more than enough to cover the amount of the debt still unpaid. The bank agreed. Amman and the bank signed an agreement releasing the bank’s security interest in the ring, and Amman sold it.

Two years later when $5000 remained to be paid, Amman defaulted on his loan. The first thing that the bank did was to ask Samra to pay under her guarantee the amount of the payments that Amman had missed. Does Samra have to pay?