In its Unifying Decision No. 155 dated 14/12/1347, the Supreme Court of Iran held that a bankrupt merchant is not liable for damages arising from delay in the payment of his commercial debts. In subsequent years, divergent judicial opinions emerged regarding the extension of this ruling to the guarantors of a bankrupt merchant. The Supreme Court once again resolved this divergence by issuing Unifying Decision No. 788 dated 27/3/1399, holding that guarantors, like the merchant himself, are exempt from compensating damages for delay in payment. Taken together, these two unifying decisions have created grounds for extensive abuse by certain merchants and have been subject to criticism by capital providers, particularly banks and financial and credit institutions. The present study seeks to answer the question of what constitutes the legal basis for exempting the guarantor from the payment of delay damages, and what criticisms this exemption faces. The findings of this research—conducted through a descriptive–analytical method and based on library resources—indicate that the foundation of such exemption lies in the accessory (dependent) nature of the contract of guarantee (ʿaqd al-ḍamān). Pursuant to certain provisions of the Commercial Code and the Civil Code, and in conformity with Islamic jurisprudence, guarantee is deemed an accessory contract; accordingly, when the principal obligor (maḍmūn ʿanhu, i.e., the merchant) is discharged from payment of the debt, the liability of the guarantor is likewise extinguished. For this reason, the Supreme Court, in the aforementioned decision, ruled in favor of the guarantor’s exemption. Nevertheless, the discharge of the guarantor’s obligation is subject to several criticisms. The most significant criticism concerns the incompatibility of such exemption with the purpose and underlying philosophy of the contract of guarantee. The objective of guarantee is that, should the principal debtor intentionally or due to inability fail to discharge his obligations, the creditor (maḍmūn lahu) may readily recover the debt by recourse to the guarantor. However, if the exemption of the principal debtor from liability for delay damages results in the exemption of the guarantor as well, the fundamental purpose and intent of the guarantee contract are undermined.