The subrogatory action is the judicial claim of a creditor who seeks to replace his debtor in his own credits, so that he increases his assets and can collect his own debts.
The subrogation action is different from the figure of subrogation. Subrogation is the substitution in the position of a person acquiring both his rights and obligations. The subrogation action does not pursue this purpose.
This procedural action simply grants the possibility that a creditor substitutes his own debtor before the credits of this, to be able to later collect his credits to have increased the patrimony of the debtor. It is a subsidiary action.
The inactivity of the debtor with his own credits, that is, his little interest in receiving what his debtors owe him is what causes this action.
In this way, once the creditor substitutes his debtor in his actions to obtain the payment of his credits, he manages to increase the debtor’s assets and thus be able to collect his own credit. Which means that an essential requirement to initiate this action is the insolvency of the debtor.
That is, the substitution is only in the procedural action and does not acquire its rights and obligations.
Requirements of the subrogation action
The necessary requirements for a creditor to be able to file this action are four:
- Insolvency of the debtor : The debtor does not have to have enough assets for the creditor to collect the debt.
- The debtor does not have to respond to his debt, but he does have credits in his favor. Therefore, what the creditor does is: "since he cannot pay me because he has no assets, I subrogate myself in his position as creditor so that he can collect the credit and thus have assets to pay me."
- The creditor does not keep directly the payment of the credit that the debtor has in his favor, but these assets pass to the debtor’s assets and later the creditor collects it from him.
- The creditor must have exhausted all possible means of ascertaining the debtor’s assets.
- That effectively the creditor has a credit right against the debtor.
- That the credit that the debtor has in his favor is not of a personal nature. For this credit to be considered as personal, it means that only and only the debtor can make this action effective (without the possibility of subrogation). For example, family actions such as divorce. It could increase the debtor’s assets, but in this case it is not possible to be subrogated by the creditor of the latter.
Example of subrogation action
To better understand this subrogation action, we are going to give an example:
A creditor (A) sold a car to (B) for $ 100. (A) delivered the car, but (B) did not pay the price, therefore, (A) owes $ 100 to his debtor (B).
(B) in turn has a credit in favor with (C). (B) fixed a breakdown at (C) for $ 80 but (C) did not pay him.
(B) is insolvent and (A) cannot be collected on its debt. (B) does not want to collect his own debt with (C) because in that case the $ 80 that he owes (C) will go to the payment he has pending with (A).
Once this situation is seen (A) exercises the subrogation action and replaces (B) demanding the debt of (C). This increases the equity of (B) and can collect at least $ 80 of the debt.