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In a criminal case, the accused, Juan Dela Cruz, posts a bail bond in the amount PHP 600,000 with Guardian Surety Co. to secure his appearance; the bond clause provides: “If the Principal fails to appear, the Surety shall pay the actual damages suffered by the Government up to the bond amount; payment under this bond shall not release the Principal from any obligations arising from the case and shall not prejudice other remedies available to the Government.” After the case is resolved against the Principal and the Government demands payment, Guardian Surety Co. pays PHP 600,000 to the Government. The Principal contends that Guardian Surety’s liability is limited to the actual damages suffered and ends upon payment, while Guardian Surety asserts its right of subrogation to recover the amount paid from the Principal. (a) Identify the legally relevant actors, their roles, and the governing doctrine on liability—who bears responsibility to the obligee and how a surety’s payment affects the Principal’s obligations. (b) After payment, what is the Principal’s potential obligation to Guardian Surety and to the Government, and what rights of recovery does Guardian Surety acquire against the Principal? (c) Apply the rules to the facts and state the parties’ rights and liabilities going forward.