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{{Short description|US civil court procedural device}}
{{distinguish|Impleader}}
{{Civil procedure (United States)}}
'''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.
==Terminology and overview==
In an interpleader action, the party initiating the litigation, normally the plaintiff, is termed the ''[[Stakeholder (law)|stakeholder]]''. The money or other property in controversy is called the ''res'' (a [[Latin]] word meaning object or thing). All defendants having a possible interest in the subject matter of the case are called ''claimants''. In some jurisdictions, the plaintiff is referred to as the ''plaintiff-in-interpleader'' and each claimant a ''claimant-in-interpleader''.
An interpleader proceeding has two stages. The first stage determines if the stakeholder is entitled to an interpleader and if he should be discharged from liability. The second stage is like an action at law to determine which of the claimants is entitled to the res.<ref name=":0">{{cite journal|last=Chafee Jr.|author2=Zechariah|title=Broadening the Second Stage of Interpleader|journal=Harvard Law Review|date=June 1946|volume=54|issue=4|pages=541–562|jstor=1334420}}</ref>
==Application==
Suppose a person dies with a valid [[life insurance]] policy in effect. The insurance company is ready, willing, and able to pay the policy proceeds in specified percentages to named beneficiaries as last directed by the policyholder, but becomes aware of a dispute among them and/or third parties as to who are the proper beneficiaries or the proper distribution of proceeds among the beneficiaries. Such a dispute commonly arises from interpersonal friction among the policyholder's survivors. One specific situation commonly seen in the reported cases is where the policyholder was allegedly murdered by a beneficiary (which would disqualify that beneficiary from receiving any proceeds).<ref>Actual examples of this scenario include ''[https://scholar.google.com/scholar_case?case=1805459992462288004 Davis v. Aetna Life Insurance Company],'' 279 F.2d 304 (9th Cir. 1960) and ''[https://scholar.google.com/scholar_case?case=8772954373913748476 Prudential Insurance Company of America v. Tull],'' 690 F.2d 848 (4th Cir. 1982).</ref>
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, which vary by jurisdiction, sometimes allow the stakeholder to retain the ''res'' pending final disposition of the case. Typically, once the stakeholder deposits the ''res'' into the court (for example, the face value of the insurance policy), the stakeholder is released from the action and the claimants proceed against each other to determine which of them is legally entitled to the ''res''. A disinterested stakeholder is entitled to [[costs (English law)|costs]] including [[attorney's fee]]s. Except for the denominations of the parties, the action proceeds for the most part as other civil lawsuits in the same jurisdiction.▼
▲
In some jurisdictions, the ''res'' will earn interest at the legal rate until disbursed. The successful claimant is entitled to the interest as well as the principal.
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==History==
===Origins in common law and equity===
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|
It originally applied to [[bailee]]s subject to multiple actions of [[detinue]],{{sfn|Maclennan|
In contrast, the equitable bill of interpleader required that:
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# All the adverse titles or claims must be dependent or derived from a common source;
# The stakeholder must not have or claim any interest it the ''res'',
# The stakeholder must have incurred no independent liability to any claimant, i.e. he must be perfectly indifferent between them.{{sfn|Maclennan|
===Subsequent development in England and Wales===
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::* is ready to bring into court or pay or depose of the subject matter of the action in such manner as the court directs.
Statutory interpleader was extended by [[Common Law Procedure Act 1860]],<ref>{{Cite canlaw|short title
The statutory rules governing interpleader proceedings were replaced by rules of court that came into force upon the passage of the [[Supreme Court of Judicature Act 1873]] (as amended by the Supreme Court of Judicature Act 1875), which came to be known as Order 17 of the [[Rules of the Supreme Court]]. A similar provision was enacted in the [[County Court Rules]], known as Order 33 in the Rules of 1981.<ref>{{Cite legislation UK|type = si|year = 1981|number = 1687|si = The County Court Rules 1981}}</ref>
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:* the provisions of Rule 85.5 impose no time limit by which the application under that Rule must be made by the creditor or other party claiming an interest.<ref>[2018] EWHC 219 (QB), par. 8-9</ref>
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|
===In the United States===
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 by there being a [http://definitions.uslegal.com/b/bill-in-the-nature-of-interpleader/ Bill in the Nature of Interpleader] rather than a [https://
The [[Supreme Court of the United States]] ruled in ''[[New York Life v. Dunlevy]]'' {{ussc|241|518}}, that for a claimant to be bound by an interpleader that party must be served process in a way that obtains [[personal jurisdiction]]. In 1922 the United States Supreme Court in ''[[Liberty Oil Co. v. Condon Nat. Bank]]'' {{ussc|260|235}} sustained that a defensive interpeader in an action at law in federal court could be taken under Judicial Code section 274b added by {{USStat|38|956}} that authorized the interposing of equitable defenses in actions at law.
The [[Federal Interpleader Act of 1917]] {{usstat|39|929}} was enacted by the [[64th United States Congress]] approved February 22, 1917 to overcome the problem with an interpleader when the claimants live in different states raised in ''New York Life v. Dunlevy''. The Federal Interpleader Act of 1917 allowed an [[insurance company]], or [[Friendly society|fraternal benefit society]] subject to multiple claims on the same [[Insurance policy|policy]] to file a suit in [[equity (law)|equity]] by a bill of interpleader in [[United States
}}</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 [[
Federal
[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] (
==Different types of interpleader in U.S.
There are two specific types of interpleader actions in the [[United States federal courts]]. Statutory Interpleader governed by {{UnitedStatesCode|28|1335}}, and Rule Interpleader established by [[Federal Rules of Civil Procedure]] {{frcp|22}}.
=== Statutory
* {{UnitedStatesCode|28|1335}} allows an individual with a stake which is, or may be, claimed by two or more adverse claimants, to interplead those claimants and bring them into a singular action.
* '''Jurisdiction''': Under {{UnitedStatesCode|28|2361}}, a person anywhere within the United States may be served by the stakeholder
* '''Diversity''': [[Diversity jurisdiction]] is satisfied as long as there are two claimants of different states {{USCSub|28|1335|a|1}}. For example, if you have three claimants, two of which are residents of Florida, and one from California, diversity would be satisfied. The diversity of the stakeholder, however, is irrelevant to the rule. This is known as minimal diversity and was held to be permissible under [[Article III of the United States Constitution#Section 2: Judicial power, jurisdiction, and trial by jury|Article III, § 2]] of the [[United States Constitution]], ''[[State Farm Fire and Cas. Co. v. Tashire]]'' {{ussc|386|523|1967|pin=530}}
* '''Amount in
* '''Venue''': The venue for a Statutory Interpleader is in the Judicial District in which one of the claimants resides, {{usc|28|1397}}.
* '''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://openyls.law.yale.edu/bitstream/20.500.13051/12648/2/47_45YaleLJ963_1935_1936_.pdf}}</ref>
Such an action may be entertained although the titles or claims of the conflicting claimants do not have a common origin, or are not identical, but are adverse to and independent of one another. {{USCSub|28|1335|b}}.
* '''Injunction'
The may claim language added in 1948 codification to [[Title 28 of the United States Code]] in the definitions of claim allow interpleader for unliquidated claims, such as multiple claimant to a [[liability insurance]] policy injured in an accident before they are reduced to judgment or settled, however the injunction may only restrain the claimants from suits making claims against the ''res'' not suits to liquidate the claim or against third parties.<ref>''State Farm Fire and Cas. Co. v. Tashire'' {{ussc|386|523|1967|pin=530}}</ref> The procedures for a Statutory Interpleader action are governed by the Federal Rules of Civil Procedure. Rule 22(b).
=== Rule
<small>(Current as of December 1, 2011)</small>
Interpleader is also allowed by the [[Federal Rules of Civil Procedure]] {{frcp|22}}. Rule 22 is known as rule interpleader. Rule interpleader provides a remedy for any person who is, or may be exposed to double or multiple liabilities. The stakeholder may invoke Rule 22 as a plaintiff, or by counter-claiming in an action already started against him by one, or more claimants. There are specific differences between Statutory Interpleader, and Rule Interpleader:
* '''Jurisdiction''': Rule Interpleader does not provide a basis for jurisdiction in the [[United States District Court]]; there must be an independent basis of jurisdiction under [[Title 28 of the United States Code]], i.e., [[diversity jurisdiction]] {{USCSub|28|1332|a}} which requires that the claimants have complete diversity between the stakeholder, and all claimants; but not between the claimants, or [[federal question jurisdiction]] {{usc|28|1331}} i.e., when a claim is based on federal law;<ref>[http://law.justia.com/cases/federal/appellate-courts/F2/999/581/308917/ Commercial Union Insurance Co. v. U.S. {{west|F|999|2|581|1993|DC Cir.| }}]</ref> or there is a specific statute authorizing interpleader i.e., {{usc|38|1984}} or {{uscsub|49|80110|e}}.
* '''Service''': There is no nationwide service of process as in a statutory interpleader action. Service must be carried out within the state where the court sits, or according to the [[long-arm statute]] of the state, Rule [https://www.law.cornell.edu/rules/frcp/rule_4 4(k)(1)].
* '''Amount in Controversy''': The amount in controversy must exceed $75,000 if based on diversity jurisdiction meeting the requirements of {{USCSub|28|1332|b}}.
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====Federal Rules of Civil Procedure 22 ====
:(A) the claims of the several claimants, or the titles on which their claims depend, lack a common origin or are adverse and independent rather than identical; or
:(B) the plaintiff denies liability in whole or in part to any or all of the claimants.
This rule supplements{{spaced ndash}}and does not limit{{spaced ndash}} the [[joinder]] of parties allowed by Rule {{frcp|20}}. The remedy this rule provides is in addition to{{spaced ndash}}and does not supersede or limit{{spaced ndash}}the remedy provided by {{usc|28|1335}}, {{usc|28|1397|pipe=1397}}, and {{usc|28|2361|pipe=2361}}. An action under those statutes must be conducted under [[Federal Rules of Civil Procedure|these rules]].
==Interpleader in U.S. State practice==
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==Further reading==
* {{cite book |last= Simon|first= Henry Andrews|date= 1850|edition=Second|title= A Practical Treatise of The Law of Interpleader|location= London|publisher= Shaw and Sons
* {{cite journal |last1= Hazard|first1= Geoffrey C. Jr.|last2= Moskovitz|first2= Myron|date= 1964|title= An Historical and Critical Analysis of Interpleader|url= http://scholarship.law.upenn.edu/faculty_scholarship/1069|journal= [[California Law Review]]|volume=52|issue= 4|pages=706–763
* {{cite book |last= Maclennan|first= Roderick James|date= 1901|title= The Law of Interpleader as administered by the English, Irish, American, Canadian and Australian Courts|url= https://archive.org/stream/cihm_73060#page/n7/mode/1up|location= Toronto|publisher= [[Carswell (publisher)|Carswell]]|ref= harv}}▼
▲* {{cite journal |last1= Hazard|first1= Geoffrey C. Jr.|last2= Moskovitz|first2= Myron|date= 1964|title= An Historical and Critical Analysis of Interpleader|url= http://scholarship.law.upenn.edu/faculty_scholarship/1069|journal= [[California Law Review]]|volume=52|issue= 4|pages=706–763|ref=harv |doi= 10.2307/3479049|jstor= 3479049}}
== References ==
{{Reflist}}
==Sources==
▲* {{cite book |last= Maclennan|first= Roderick James|date= 1901|title= The Law of Interpleader as administered by the English, Irish, American, Canadian and Australian Courts|url= https://archive.org/stream/cihm_73060#page/n7/mode/1up|location= Toronto|publisher= [[Carswell (publisher)|Carswell]]|
==External links==
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