Equitable Subrogation

“Subrogation arises when one party (the subrogee) indemnifies or pays the principal debtor’s obligation to the creditor or claimant (the subrogor).”

Chicago Title Ins. Co. v. AMZ Insurance Services, Inc.,188 Cal. App. 4th 401, 432 (2010).

“One who claims to be equitably subrogated to the rights of a secured creditor must satisfy certain prerequisites. These are:

‘(1) Payment must have been made by the subrogee to protect his own interest;
(2) The subrogee must not have acted as a volunteer;
(3) The debt paid must be one for which the subrogee was not primarily liable;
(4) The entire debt must have been paid; [and] (5) Subrogation must not work any injustice to the rights of others.’”

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