Lenders, title insurance companies and their agents should be aware that on April 21, 2011, the Supreme Court of Kentucky issued a decision that could have a significant effect on Kentucky courts’ application of the doctrine of equitable subrogation in Kentucky.  Wells Fargo Bank, Minnesota, N.A. v. Commonwealth, — S.W.3d —, 2011 WL 1620578 (Ky. Apr. 21, 2011).  While not often litigated at the appellate level (in part because of its widely accepted application), the doctrine of equitable subrogation has long been a reliable tool used by lenders and their title insurance companies to ensure that mortgage loans intended to have first priority actually receive that first priority position.  But the Wells Fargo decision limits the doctrine’s application to such an extent that it could threaten the viability of equitable subrogation in Kentucky on a going-forward basis.