Subrogation – new guidance from the Supreme Court


On 4th November 2015, the Supreme Court Judges handed down their judgments in Menelaou v Bank of Cyprus UK Ltd [2015] UKSC 66. Mark Warwick QC was leading Counsel for the appellant. The judgments explain that, when a party (X) who has been unjustly enriched, to the detriment of another party (Y), so that X acquires a property free from a charge in favour of Y, the remedy of subrogation can be invoked by Y, so as to gain a proprietary interest in Xs property. 4 of the 5 Judges stressed that the equitable remedy is broad and flexible. Various cautionary words, in cases and textbooks, restraining the scope of subrogation, have been cast aside. Further developments in the law of subrogation are likely. To see the judgments on the Supreme Court website, click here.