Interpleader
From Wikipedia, the free encyclopedia
Interpleader is a form of action originally developed under equity jurisprudence. It allows a plaintiff to initiate a lawsuit in order to compel two or more other parties to litigate a dispute. An interpleader action originates when the plaintiff holds property on behalf of another, but doesn't know to whom the property should be transferred. It is often used to resolve disputes arising under insurance contracts.
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[edit] Usage
In an interpleader action, the party initiating the litigation, nominally the plaintiff, is termed the stakeholder. The money or other property in controversy is called the res. All defendants having a possible interest in the subject matter of the case are called claimants.
[edit] Application
For example, suppose a person dies with a life insurance policy. However, the insurance company knows there will be a dispute over who should receive the proceeds. The insurance company can file an interpleader action. The insurance company is the stakeholder, the claimants are the persons who might be beneficiaries under the policy, and the cash value of the policy benefit is the res. Under the proceeding as originally developed, the stakeholder would deposit the res with the court, and then the defendants would have their claims adjudicated by the court. Statutory modifications to the procedure (varying, of course, by jurisdiction) sometimes allow the stakeholder to retain the res pending final disposition of the case...
[edit] History
Formerly a plaintiff had to disavow any claim to the res in order to avail himself of the interpleader remedy, but this requirement has also been relaxed or abolished in most jurisdictions.
[edit] Trivia
Interpleader actions in the United States district courts are authorized by Title 28, U.S. Code, Section 1335. This known as statutory interpleader. Statutory interpleader is different from rule interpleader. Statutory interpleader allows for a stakeholder to have broader federal jurisdiction.
Interpleader is also allowed by the Federal Rules of Civil Procedure Rule 22. Rule 22 is known as rule interpleader. Rule interpleader is allowed where there is complete diversity and the amount in controversy exceeds 75,000 dollars. These requirements satisfy Title 28, U.S. Code, Section 1332. Rule interpleader gives fewer rights to a stakeholder than statutory interpleader.
See http://www.law.cornell.edu/rules/frcp/index.html#chapter_iv for the Federal Rules of Civil Procedure.
Rule 22. Interpleader
(1) Persons having claims against the plaintiff may be joined as defendants and required to interplead when their claims are such that the plaintiff is or may be exposed to double or multiple liability. It is not ground for objection to the joinder that the claims of the several claimants or the titles on which their claims depend do not have a common origin or are not identical but are adverse to and independent of one another, or that the plaintiff avers that the plaintiff is not liable in whole or in part to any or all of the claimants. A defendant exposed to similar liability may obtain such interpleader by way of cross-claim or counterclaim. The provisions of this rule supplement and do not in any way limit the joinder of parties permitted in Rule 20.
(2) The remedy herein provided is in addition to and in no way supersedes or limits the remedy provided by Title 28, U.S.C. ยงยง 1335, 1397, and 2361. Actions under those provisions shall be conducted in accordance with these rules.
