What is an Interpleader?

Article Details
  • Written By: R.A. Anderson
  • Edited By: J.T. Gale
  • Last Modified Date: 08 April 2020
  • Copyright Protected:
    Conjecture Corporation
  • Print this Article
Free Widgets for your Site/Blog
When you eat a piece of pineapple, its enzymes will attack your tongue; luckily, the damaged cells can regenerate.  more...

April 9 ,  1865 :  Robert E. Lee surrendered.  more...

An interpleader is a legal procedure that is used when two parties stake a claim for the property or money of a mutual third party. It is a form of equitable relief that is used to determine which party shall be entitled to the contested assets. In an interpleader action, these assets are called the stake and its custodian is known as the stakeholder. The persons who may have a right to the stake are referred to as claimants. Although a stakeholder may use this action in any type of case, it is frequently used in response to disputes over insurance contracts, such as when a policyholder dies and it is unclear who shall become the beneficiary.

Only a stakeholder can commence an interpleader action. It formally begins when the stakeholder prepares a written complaint with the court of jurisdiction. In the complaint, the claimant concedes that he or she may owe the stake to more than one party but does not know who is legally entitled to it. By allowing the court to adjudicate the dispute, the action prevents multiple lawsuits involving the same stake.


Claimants may file additional claims during the interpleader action that are separate from the stake, provided that the actions are related to the matter being litigated. Also, the additional actions are required to not significantly delay the proceedings. Because the types of claims brought with action can vary greatly, the judge in each case is given discretion over whether to hear related matters or not.

Commonly, parties employ interpleader in civil proceedings at the federal level. Within the federal court system, there are two forms of this action available to stakeholders. One comes under Rule 22 of the Federal Rules of Civil Procedure; the other is permitted under 28 U.S.C.A. § 1335.

Rule 22 interpleader requires that the property in question must be valued at over $10,000 US Dollars (USD). It also requires that the claimants reside in a jurisdiction other than the state of the stakeholder’s residence. Interpleader coming under 28 U.S.C.A. § 1335, on the other hand, must involve a claim valued at $500 USD.

Additionally, under § 1335, the claimants must reside in different states. The citizenship of the stakeholder does not come into play in 28 U.S.C.A. § 1335. When a stakeholder files a petition under Rule 22, he or she must also post a bond in an amount equivalent to the stake.

Interpleader coming under 28 U.S.C.A. § 1335 can be heard by the court of any state where at least one claimant resides. Stakeholders who file Rule 22 have a wider choice of jurisdictions. Rule 22 may be filed in the state where either the claimant or the stakeholder resides, or where the dispute in question took place.


You might also Like


Discuss this Article

Post your comments

Post Anonymously


forgot password?