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Prerequisites to the Right of Subrogation

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PREREQUISITES TO THE RIGHT OF SUBROGATION. All persons who occupy the situation of sureties or guarantors, whether technically called such or not, are, without doing any act signifying their intention to elect or ac cept the privileges of the right, subrogated to the rights of the creditor against the principal upon payment of the debt. (Prow, Jacobs & Co.'s Estate, 73 Pa. St., 459; Brandt, Sur. & Guar., Sec. 299.) If, by laches or delay in asserting the right of subrogation the surety has allowed others to secure bona fide claims to the property, he will be held to have lost his right. (Gring's Appeal, 89 Pa. St., 336.) The surety must generally pay the debt of the principal to be entitled to subrogation, but the form of payment is unimportant, and he may pay by note and enforce subrogation though the notes given in payment are not paid. (Stedman v. Freeman, 15 Ind., 86.) The surety upon being subrogated to the rights of the creditor stands in his place, and cannot claim any greater rights than the creditor would have had. So the surety may waive his right to subrogation. (Tyus v. De Jarnette, 26 Ala., 280.) The surety being entitled to subrogation to all the securities which the creditor acquires from the prin cipal, a release of such securities by the creditor or their negligent loss by him, will discharge the surety to the extent that such securities would have paid the debt of the principal. (Nelson v. Munch, 28 Minn., 314.)

surety and creditor