2d 966 (D.C. 1994). It normally arises when one individual satisfies the debt of another as a result of a contractual agreement which provides that any claims or liens that exist as security for the debt be kept alive for the benefit of the party who pays the debt.

How does the right of subrogation arises?

Subrogation by contract commonly arises in contracts of insurance. The doctrine of subrogation confers upon the insurer the right to receive the benefit of such rights and remedies as the assured has against third parties in regard to the loss to the extent that the insurer has indemnified the loss and made it good.

When the right of subrogation may be arises?

1. Equitable right of subrogation arises when insurer settles the claim of the assured, for the entire loss. When there is equitable subrogation in favour of the insurer, then the insurer entitles to stand in shoes of the assured and sue the wrongdoer; 2.