Opinion ID: 10022
Heading Depth: 3
Heading Rank: 2

Heading: Legal Subrogation.

Text: 29 The five instances in which legal subrogation may occur are specifically listed in La.Civ.Code art. 1829. The only instance that is applicable to this case is the third one: 30 [Subrogation takes place by operation of law] in favor of an obligor who pays a debt he owes with others or for others and who has recourse against the others as a result of the payment. 31 The district court found that this section did not apply because the Settlement Agreement did not include a right to contribution among the directors and officers, and therefore the required recourse against the others was absent. For the reasons previously discussed, we agree with the district court's interpretation of the Settlement Agreement. 32 Furthermore, we find that regardless of the content of the Settlement Agreement, legal subrogation would not apply to this case. Under Louisiana law, where there is no solidary liability, any right to contribution must arise out of the rights of the common creditor. 15 In this case, the RTC did not subrogate its rights against the non-paying signatories to the only paying signatory, Wilhite. Therefore, Wilhite could have no right of contribution or subrogation against his co-debtors. To find otherwise would allow one party to transform a joint and divisible obligation into a solidary obligation by the mere application of the legal subrogation statute. This interpretation would make the distinction between divisible and indivisible meaningless. Therefore, we find that Wilhite has no subrogation rights against Schendle. 33