Interpleader Action

Interpleader Action:

Interpleader Action

A party in possession of a property may decides to compel the persons that are laying claim over the said property to attend to court and establish their claim. An interpleader is a person who is in possession of a property which ownership is contested by two parties and which the person in possession has nothing to protect in the property but will majestically take the matter to the court and pleads with the court to compel the claimants to come and establish their various claim.

From the above rendition, it would be correct that for an interpleader action to succeed in the court, the person praying for an interpleading must be in possession of an asset that is being contested by two or more parties and the person in possession must also be confused of the rightful owner of the said Asset or property.

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The only way for the Interpleader to resolve the dispute and determine the rightful ownership must be to compel the parties to appear in the court and claim against each other. This will relieve the interpleader from the stress of determining the rightful owner of the property by himself.

However, it must be clear that the party filing for an interpleader action must not have any interest to protect in the property or asset that is being claimed by the parties.

In conclusion, it would be germane to note that an action for interpleader must be filed in accordance to the rules of the court. Any person that is joined as a party to an interpleader action, must attend to the court to lay his claim as failure to attend to the court may be deemed as forfeiture of the said claim and he can never be seen rejuvenating such claim in the court. So, all the persons with their claiming interest on the property are meant to be joined in the action as parties. Failure to join a party may vitiate the action. However, a person joined as a party may decide not to attend to the case in the court and have his interest forfeited forever.

READ ALSO: Effect of Non Service of Court Process

Types of Interpleader

There are two types of interpleader

  1. Sheriff’s interpleader is used in circumstances where a sheriff in execution of a judgment attaches property, which is claimed by a third party who is not the judgment debtor. It should be recalled here that a sheriff is one of the officials of the court and they are usually saddled with the responsibility of executing court judgment. However, time may come when he is in possession of a property that is meant to be executed in the favour of a party and another person may also have interest in that said property, the law demands that he should file for interpleader, wherein the parties shall be allowed to contest their claims between themselves.
  2. Stakeholder’s interpleader is one by any other person not being a sheriff. A very good example of this is the Insurance company. The insurance company can delve into filing for interpleader where in life insurance policy the party to whom the insurance policy is death and the beneficiaries in their numbers are dragging the ownership of the proceeds of the insurance. If the insurance company is uncertain of the rightful owner of the proceed of the insurance policy, they can drag the parties to the court and in charge them to establish their various claims. It will be left to the court to determine the right owner of the proceeds.

Take Note:

Once the person in possession of the said contesting property or money succeeds in his interpleading application, he will be discharged as a party in the action, the parties that are contesting ownership of the property will then go ahead and establish their claims. This entails that the interpleader must not have any interest on the property and either of the contesting parties must not be owing him any dime with regards to the said property.

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