Walker v. Bates

At the time of the execution of the mortgage to the savings bank on January 4, 1921, it drew its cashier's cheek for $6,095, payable to the Bank of Detroit, the successor of the Highland Park State Bank, of which $4,095 was used in payment of its mortgage. The discharge was executed on January 5th and recorded the following day. To that extent I think the savings bank should be subrogated *Page 587 to the rights of the State bank. This is what is known in law as "conventional subrogation." This question was so fully considered in the recent case of French v. Grand Reach Co.,239 Mich. 575, that I refrain from further discussion and content myself with a brief quotation therefrom: "It arises from an agreement between the debtor and a third person whereby the latter, in consideration that the security of the creditor and all his rights thereunder be vested in him, agrees to make payment of the debt in order to relieve the debtor from a sacrifice of his property due to an enforced sale thereof. It is wholly independent of any interest in the property which the lender may have to protect. It does not, however, inure to a mere volunteer who has no equities which appeal to the conscience of the court. In speaking of subrogation, it was said in Stroh v. O'Hearn, 176 Mich. 164: " 'It is proper in all cases to allow it where injustice would follow its denial, and in allowing it all injustice should be guarded against so far as possible.' " The first mortgage was upon the property when the notice oflis pendens was filed. No injustice results from subjecting plaintiffs' rights thereto. Their interest in the property is charged with the payment of a mortgage lien of the same amount as that which was on it when the lis pendens was filed. The trial court very aptly said: "It is immaterial to the plaintiff and wasn't wronging him any, to just simply change from the Highland Park Bank to the Commonwealth Bank." See Smith v. Sprague, ante, p. 577. The decree is affirmed, with costs to appellees. NORTH, FELLOWS, WIEST, CLARK, and McDONALD, JJ., concurred with SHARPE, J. *Page 588