Interpleader
From Free net 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.
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.
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.
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.
Interpleader actions in the United States district courts are authorized by Title 28, U.S. Code, Section 1335.