Whenever the rents and profits are more than the annual interest, a rest is made; that is, the net amount of rents and profits in excess of the interest is deducted from the mortgage debt, and from that time interest is computed only upon the balance.176 If, at the end of any interest period, the rents and profits are less than the

167 Miner v. Beekman, 50 N. Y. 337; Roberts v. Fleming, 53 111. 196; Millard v. Truax, 73 Mich. 381, 41 N. W. 328; Hadley v. Stewart, 65 Wis. 481, 27 N. W. 340; Bacon v. Cottrell, 13 Minn. 194 (Gil. 183); Troost v. Davis, 31 Ind. 34.

168 Eaton v. Simonds, 14 Pick. (Mass.) 98; Clark v. Smith, 1 N. J. Eq. 121; Elmer v. Loper, 25 N. J. Eq. 475.

169 2 Jones, Mortg. (5th Ed.) § 1133.

170 Davis v. Dendy, 3 Madd. 170; Harper v. Ely, 70 111. 581.

171 Harper v. Ely, 70 111. 581; Dooley v. Potter, 146 Mass. 148, 15 N. E. 499; Sldenberg v. Ely, 90 N. Y. 257; Gooch v. Botts, 110 Mo. 419, 20 S. W. 192; Savings & Loan Soc. v. Burnett, 106 Cal. 514, 39 Pac. 922.

172 Mccormick v. Knox, 105 U. S. 122; Davis v. Bean, 114 Mass. 360; Corn-stock v. Michael, 17 Neb. 288, 22 N. W. 549; Fitch v. Stallings, 5 Colo. App. 106, 38 Pac. 393.

173 Hughes v. Johnson, 38 Ark. 285.

174 Johnson v. Hosford, 110 Ind. 572, 10 N. E. 407.

175 Hubbard v. Shaw, 12 Allen (Mass.) 120.

176 Van Vronker v. Eastman, 7 Mete. (Mass.) 157; Reed v. Reed, 10 Pick. (Mass.) 398; Gladding v. Warner, 36 Vt. 54; Blum v. Mitchell, 59 Ala. 535; Jencks v. Alexander, 11 Paige (N. Y.) 619. And see Adams v. Sayre, 76 Ala. 509.

§§ 123-124) interest charged, no rest is made, but the account continues until the rents and profits due exceed the interest.177

Same - subrogation

123. Whenever one not primarily liable for the mortgage debt pays it to protect his own rights, he is substituted in equity in place of the mortgagee, and may enforce against the person primarily liable all the securities held by the mortgagee. This is called " subrogation."

124. The persons entitled to a deceased mortgagor's realty can compel the mortgage debt to be paid out of his personal property (p. 204).

Subrogation

Subrogation is a method of enforcing payment against one ultimately liable on a mortgage debt.178 In effect, it is an assignment of the creditor's mortgage and other securities to the one paying the debt.179 Subrogation does not arise when part only of the mortgage debt is paid.180 It can be claimed only in favor of one who has paid a mortgage debt not his duty to pay.181 A mere volunteer cannot invoke the aid of subrogation. He must have paid under some compulsion made necessary for the protection of his rights; otherwise payment extinguishes the debt.* A mortgagor who has conveyed subject to the mortgage, and who has been proceeded against personally for the mortgage debt, is entitled to subrogation against his grantee.182 But one loaning money to the mortgagor to pay the mortgage debt is not subrogated unless there be a special agreement to that effect.183 An indorser of a note, or a surety of the mortgage debt, are subrogated to the rights of the mortgagee, when compelled to discharge the indebtedness.184 And the principal creditor is subrogated to any securities held by the surety.185

177 Bennett v. Cook, 2 Hun (N. T.) 526; French v. Kennedy, 7 Barb. (N. Y.) 452; Moshler v. Norton, 100 111. 63; Snavely v. Pickle, 29 Grat (Va.) 27.

178 see Fetter, Eq. p. 254; Matthews v. Trust Co., 52 Fed. 687; Mccormlck v. Irwin, 35 Pa. St. 111.

179 Barnes v. Mott, 64 N. Y. 397; Ellsworth v. Lockwood, 42 N. Y. 89; Lay-lin v. Knox, 41 Mich. 40, 1 N. W. 913; Levy v. Martin, 48 Wis. 198, 4 N. W. 85; Muir v. Berkshire, 52 Ind. 149; Sessions v. Kent, 75 Iowa, 601, 39 N. W. 914.

180 In re Graff's Estate, 139 Pa. St. 69, 21 Atl. 233.

181 Arnold v. Green, 116 N. Y. 566, 23 N. E. 1; Pease v. Egan, 131 N. Y. 262, 30 N. E. 102; Young v. Morgan, 89 111. 199.

* See Fetter, Eq. 254.