Subrogation arises in the same cases as exoneration. This right is in the nature of additional security for the enforcement of the right of exoneration, and gives to any person (except the primary debtor) who has paid the debt, or who may lose through such debt, the benefit of any securities which the principal debtor may have given to any other party connected with the transaction. Thus a surety may be subrogated to securities given to the surety. Where securities are given to one co-surety by the principal (to secure such surety against loss) the other cosureties have a combined right of contribution and subrogation.

2 Moore vs. Isley, 22 N. C, 372. 3 Johnson vs. Torpy, 35 Neb., 604.

4 Farwell vs. Becker, 129 I11., 261; 21 N. E., 762; 6 L. R. A., 400.

"The doctrine of subrogation is of wide extent and operation in various departments of equity jurisprudence. Persons entitled to the remedy may be classified as follows: first, those who made the payment in performance of a legal duty, arising either by express agreement or by operation of law, including sureties,*5 a fire insurance company that has paid a loss caused by the negligence of a third party, and is therefore subrogated to the claim of the insured against such party;6 a surety who has paid more than his fair share is entitled to subrogation against his co-surety.7 Second, those who, while not legally bound to pay, yet might suffer loss if the obligation is not discharged, and so pay the debt in self-protection, including subsequent encumbrances, and other owners of equities or partial interests who have paid off prior incumbrances. Third, those who have paid at the request of the debtor to some other party to the obligation. A person who attempts in good faith to purchase property at a void judicial sale, and whose purchase-money is used to satisfy valid claims against the property, acts on an invitation from the public favored by public necessity and policy, and is therefore subrogated to the rights of the parties receiving the money."8 9

"Subrogation is an equitable right, and not a legal one, and can be enforced only in equity. It will not be enforced when it would be inequitable to do so, or where it would work injustice to others having equal equities. To permit subrogation in this case would not only work injustice to appellee, who succeeded to the title of Hotchkiss, which appellant admitted to be the superior one, but would permit appellant to violate his own contract with Hotchkiss. This, equity will not allow. 24 Am. & Eng. Enc. Law,

5 Darrow vs. Summerhill, 93 Tex., 92; 77 Am. St. Rep., 833.

6 Hart vs. Western R. R. Co., 13 Met. (Mass.,) 99.

7 Pace vs. Pace's Admr., 95 Va., 792.

8 Bond vs. Montgomery, 56 Ark.,

563. 9 Note to Sec. 1419, Pomeroy on Equity Jurisprudence.

191." 10

The subject of subrogation is discussed by the Supreme Court of Ohio in the case of Henderson Achert Lithographic Co. vs. John Shilhto Co.,11 as as follows:

"The creditor is undoubtedly entitled to subject to the payment of a judgment recovered on the debt any securities placed by the principal in the hands of the surety for its payment, or for his indemnity against its payment. If the securities consist of tangible property that can be reached by execution, process of that nature is the appropriate remedy for their subjection to the satisfaction of the judgment; for the property, though in the hands of the surety, being the property of the principal debtor, is subject to seizure and sale, like other property belonging to him, and its application to the payment of the debt, and the subsequent discharge of the surety's liability, is in accomplishment of the purpose for which it was placed in his custody. Where the securities are choses in action, counter bonds, or mortgages given by the principal, for the collection of which, and their application to the debt, an action becomes necessary, the surety may resort to that remedy; and the creditor may oftentimes reach property of that nature in the possession of the surety without the aid of subrogation, through a creditor's bill or proceedings in aid of execution. But as the money arising from such securities, however reached, properly belongs to the creditor for the security of whose debt they were intended, equity will aid him, through subrogation, to the remedies of the surety, which may prove the more effectual, because the creditor in that way becomes entitled to whatever priority of right exists in favor of the surety. This doctrine is sometimes said to rest upon the principle that a trust for the benefit of the creditor attaches to the property eo instanti it is placed in the possession of the surety, the execution of which may be enforced at the suit of the creditor, the cestui que trust. This was held in Pendery vs. Allen, 50 Ohio St., 121; 33 N. E., 716, and has been in many cases, some of which are cited in the brief of counsel for the plaintiff. In other cases the doctrine is said to arise from that principle of natural equity which requires that his property, in whatever form it may be, who is ultimately liable for the payment of the debt, should be primarily applied to that purpose, in exoneration of the one who is only secondarily liable. Either view presupposes that the securities are placed with the surety, and are the property of the principal debtor. The doctrine has been applied, however, where a stranger to the debt, for a sufficient consideration, has agreed to assume and discharge the obligation of the surety. The creditor may adopt and enforce the promise; for it is the property of his debtor, and its performance includes the payment of the debt. Such being its purpose, a court of chancery will see that its design is fulfilled. Champion vs. Brown, 6 Johns, Ch., 406. A distinction has been made between cases of that kind and those where the agreement is personal to the surety, for his individual indemnity only, and not for the discharge of his liability; courts in cases of the latter class holding that the creditor acquires no equity to enforce the covenant. Homer vs. Bank, 7 Conn., 478; Taylor vs. Bank, 87 Ky., 398; 9 S. W., 240; Bank vs. Hastings, 1 Doug. (Mich.), 225; Jones vs. Bank, 29 Conn., 25. There are many other authorities to the same point, some of which are cited in the brief for the defendant. An attempt to define the precise scope of this distinction is a task that need not be assumed here further than to remark that it must depend, in each case, upon the terms and conditions of the covenant or contract of indemnity; for, while the right of subrogation is not founded on contract, it is well settled that it may be qualified and controlled by express agreement of the parties, and in that respect their rights and obligations may be whatever, by their contract, they choose to make them. Contracts of that nature, like all others, are to be construed and enforced according to the intention of the parties, as derived from the language they have employed."

10 Makell vs. Hotchkiss, 190 I11, 311; 60 N. E., 524.

11 64 Ohio St., 236; 60 N. E., 295.