Interpleader: Difference between revisions

'''Interpleader''' is a [[civil procedure]] device that allows a [[plaintiff]] or a defendant 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 does not know to whom the property should be transferred. It is often used to resolve disputes arising under [[insurance]] contracts, such as when a Plaintiff with a personal injury claim has a dispute with medical providers over the payment out of a settlement for medical services provided to treat the Plaintiff's injuries.

Interpleader had its origins as a civil procedure at [[common law]], which was later adopted and expanded by the [[Court of Chancery]] in its [[Equity (law)|equitable]] [[jurisprudence]]. The common law procedure became obsolete over time and fell into disuse, but it remained active in the courts of equity.{{sfn|Maclennan|19051901|pp=5-6}}

It originally applied to [[bailee]]s subject to multiple actions of [[detinue]],{{sfn|Maclennan|19051901|p=6}} and [[privity]] was required either between the parties or in detinue, in order for the defendant to be able to sue for [[garnishment]].{{sfn|Maclennan|19051901|p=7}}

# The stakeholder must have incurred no independent liability to any claimant, i.e. he must be perfectly indifferent between them.{{sfn|Maclennan|19051901|p=11}}

In February 2018, several [[High Court enforcement officer]]s asked the [[High Court of Justice#Queen's Bench Division|Queen's Bench Division]] for directions as to how to proceed in such circumstances, and the [[Master (judiciary)|Master]] ruled that the repeal of Rule 17 had the effect of reviving the equitable form of interpleader proceedings, as the 2007 Act did not expressly abolish the interpleader action itself, and "interpleader statutes are not at all to limit or affect the equitable jurisdiction of the court to entertain an interpleader suit or action."<ref>[2018] EWHC 219 (QB), par. 31</ref>{{sfn|Maclennan|19051901|p=17}}

}}</ref> The policy must have a value of at least $500 claimed were claimed or may be claimed by adverse claimants; which is less than the [[amount in controversy]] of $3,000 in [[Judicial Code of 1911|Judicial Code]] §48(1) then required for general [[diversity jurisdiction]] and two or more of the beneficiaries must live in different states. In 1926 it was repealed and replaced by, {{usstat|44|416}} approved May 8, 1926, which added to those who can bring suit [[Casualty insurance|casualty]] company and [[surety]] company, empowered the court to enjoin claimant from proceeding in any state or other federal court on the same liability, adding provisions as to the proper venue for the interpleader in certain cases but required that there must be actual claims by eliminating the words "may claim" that were in the 1917 act. In 1936 the Federal Interpeader Act was again repealed and replaced by the [[Federal Interpleader Act of 1936]], {{USStat|49|1096}}, approved Jan. 20, 1936, drafted by [[Zechariah Chafee]] which codified it in as [[Judicial Code of 1911|United States Judicial Code]] §41(26), and established the modern [[#Statutory Interpleader|statutory interpleader]] allowing suit to be brought by any person, firm, corporation, association or society having custody of money or property or insurance policy or instrument valued at $500 or more which there are two or more adverse claimant who are citizens of different states, whether or not the claims have common origins, identical, adverse or independent of each other, and allowed it to be an [[:Category:equitable defenses|equitable defense]] in actions at [[Common law#3. Law as opposed to equity|law]], Judicial Code §274b.<ref>{{cite journal|last=Chafee|first=Zecheriah|title=Federal Interpleader Act of 1936: I|journal=Yale Law Journal|date=April 1936|volume=45|issue=6|pages=963–990|doi=10.2307/792068|jstor=792068|url=https://digitalcommonsopenyls.law.yale.edu/yljbitstream/vol4520.500.13051/iss612648/12/47_45YaleLJ963_1935_1936_.pdf}}</ref><ref>{{cite journal|last=Chafee|first=Zecheriah|title=Federal Interpleader Act of 1936: II|journal=Yale Law Journal|date=May 1936|volume=45|issue=7|pages=1161–1180|doi=10.2307/792010|jstor=792010}}</ref> When the United States Judicial Code was enacted into [[United States Code]] as [[positive law]] in 1948, {{usstat|62|931}} approved June 25, 1948, it was reconstituted as {{UnitedStatesCode|28|1335}}, {{usc|28|1397|pipe=1397}}, and {{usc|28|2361|pipe=2361}}.

[http://www.leagle.com/xmlResult.aspx?page=1&xmldoc=19811201519FSupp682_11119.xml&docbase=CSLWAR1-1950-1985&SizeDisp=7 ''Bache Halsey Stuart Shields, Inc. v. Garmaise'' 519 F.Supp. 682] (S.D.N.Y. 1881).</ref>''''''

* '''Deposit''': A Statutory Interpleader action is commenced by the stakeholder who must initially deposit with the court, the [[amount in controversy]], or post a specific bond with the court, {{USCSub|28|1335|a|2}}. The stakeholder may, however, at trial claim they don't owe money to the claimants at all, since the action can be in the nature of interpleader.<ref>{{cite journal|last=Chafee|first=Zecheriah|title=Federal Interpleader Act of 1936|journal=Yale Law Journal|date=April 1936|volume=45|issue=6|pages=963–990|doi=10.2307/792068|jstor=792068|url=https://digitalcommonsopenyls.law.yale.edu/yljbitstream/vol4520.500.13051/iss612648/12/47_45YaleLJ963_1935_1936_.pdf}}</ref>