(a) Owen had borrowed money from a credit union to purchase a car, and the credit union had required a security against the car, which they registered under the Personal Property Security Act. As well, Owen's father guaranteed the loan. Some months later, Owen decided to go back to school, and he had to sell the car to do so. He returned to the credit union and, at his request, the credit union gave up the security they had against the vehicle, knowing that they still had the loan guaranteed by Owen's father. Owen defaulted and, instead of repossessing the vehicle, the credit union demanded payment from the father.

Identify, discuss and apply the relevant principle of law involved in the case scenario. Explain in details the legal position of the father under these circumstances.

(b) After graduating, a student set up a business as a systems analyst. His monthly billings are healthy, about $10 000 a month. He rents his office, hardware, and furniture and owns few assets. He rents his apartment, has no car, and spends most of his income on concerts. If he approaches you, a bank manager, to borrow $50,000 for the purpose of increasing his working capital.

Identify, discuss in details and apply the most appropriate security required to secure the above transaction.

(c) One of the suppliers of Golddust Inc., who is owed $500.000, started a court action to reclaim that debt. Paulos also gave a personal guarantee of his debt, and has been sued in the same action. Neither Paulos nor the company has defended. On October 7, the supplier wants to obtain a default judgment against Golddust Inc. and Paulos.

Appling the correct principle of law, explain in details whether the action will succeed, and how the supplier would have been protected.