Volume 54 — Washington Appellate Reports

<bold>[1] Deeds of Trust — Deed in Lieu of Foreclosure — Merger of</bold> <bold>Legal and Equitable Titles — Intervening Encumbrance.</bold> When the continued existence of a deed of trust is necessary to protect the deed of trust beneficiary against junior encumbrances, the acceptance of a quitclaim deed in lieu of foreclosure by the deed of trust beneficiary does not have the effect of merging the legal and equitable titles, thereby extinguishing the deed of trust and the underlying debt, unless, as a matter of fact, the beneficiary intended the legal and equitable titles to merge. <bold>[2] Liens — Subrogation — Release of Lienee — Necessity.</bold> The equitable doctrine of subrogation does not apply to protect the rights of a junior lienor unless a senior lienor both knew of the junior lienor's interest and released the lienee to the junior lienor's prejudice.<page_number>Page 696</page_number>