Interpleader vs. Impleader: What's the Difference?
By Aimie Carlson & Harlon Moss || Updated on March 4, 2024
Interpleader is a legal procedure used to resolve disputes over property held by a third party, while impleader involves a defendant bringing a third party into a lawsuit to share liability.
Key Differences
Interpleader actions are initiated by a neutral third party, often a stakeholder, who holds property or funds but does not claim any right to them. This party seeks to have the court determine the rightful owner, thus avoiding multiple liabilities or litigation. On the other hand, impleader is used by defendants in a lawsuit who believe a third party is responsible for all or part of the plaintiff's claim against them. This mechanism allows defendants to shift liability to someone not originally named in the lawsuit.
The process of interpleader helps protect the stakeholder from multiple claims and judgments concerning the same property or funds. It effectively consolidates claims into one proceeding, ensuring the property is awarded to the rightful claimant. In contrast, impleader aims to protect a defendant's interests by bringing in a third party believed to be liable for the damages or relief sought by the plaintiff, potentially reducing or eliminating the defendant's liability.
Interpleader can be used in various contexts, such as insurance payouts, escrow disputes, or any situation where multiple parties claim entitlement to the same asset. The stakeholder deposits the asset with the court, which then decides its distribution. Impleader, however, is typically used in tort cases, contract disputes, or any legal situation where a defendant's liability may be attributed to another's actions.
Jurisdictionally, interpleader actions may be filed in federal or state courts, provided certain criteria are met, such as diversity of citizenship and the amount in controversy. Impleader, as a procedural tool, is governed by the rules of civil procedure of the jurisdiction in which the original lawsuit is filed, requiring no specific jurisdictional prerequisites other than those applicable to the main action.
Strategically, interpleader is often a defensive move by a stakeholder to avoid litigation costs and the risk of multiple liabilities. Impleader, conversely, is a tactic used by defendants to involve third parties they believe share responsibility for the plaintiff's claims, potentially spreading the risk and financial burden.
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Comparison Chart
Purpose
To resolve disputes over property held by a third party.
To bring a third party into a lawsuit for shared liability.
Initiated by
A neutral stakeholder without a claim to the property.
A defendant seeking to shift liability to a third party.
Use Case
Insurance payouts, escrow disputes, any situation with multiple claimants to the same asset.
Tort cases, contract disputes, where defendant's liability may be due to another's actions.
Process
Stakeholder deposits asset with court, which determines rightful claimant.
Defendant adds third party to lawsuit, who may share liability for plaintiff's claims.
Strategic Purpose
To avoid multiple liabilities and litigation costs.
To potentially reduce or eliminate defendant's liability by involving another party.
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Interpleader and Impleader Definitions
Interpleader
A legal action to determine the rightful claimant of disputed assets.
The bank filed an interpleader action to resolve competing claims on a deceased customer's account.
Impleader
Used by defendants to share or shift liability.
Facing a lawsuit, the company impleaded the manufacturer for providing faulty parts.
Interpleader
Involves depositing disputed assets with the court.
The escrow agent deposited the funds into court via an interpleader petition.
Impleader
A procedure to bring a third party into a lawsuit.
The contractor used impleader to bring the subcontractor into the lawsuit for damages.
Interpleader
Used to avoid multiple liabilities for the holder of disputed funds.
Faced with several claimants, the insurance company sought interpleader relief.
Impleader
Can potentially reduce a defendant's liability.
Through impleader, the defendant sought to attribute part of the liability to a third party.
Interpleader
Protects stakeholders from litigation costs.
Through interpleader, the stakeholder avoided the expense of multiple lawsuits.
Impleader
Governed by civil procedure rules.
The defense attorney filed an impleader motion under Rule 14.
Interpleader
A lawsuit brought on behalf of a third party to determine which of two parties is entitled to property held by the third party.
Impleader
Part of a defendant's strategic defense.
The impleader was a tactical move to involve all responsible parties in the litigation.
Interpleader
(legal) One who makes an interplea.
Impleader
The procedure by which a third party is impleaded.
Interpleader
(legal) Motion for a third party to enter into a lawsuit in process because a matter is being adjudicated in which they have an interest.
Impleader
(legal) A procedural device before trial in which a party joins a third party into a lawsuit because that party is liable to an original defendant.
Interpleader
(legal) Process by which a third party asks a court to determine which of two rival claims is to be honored by the third party.
Impleader
One who prosecutes or sues another.
Interpleader
One who interpleads.
Interpleader
A proceeding devised to enable a person, of whom the same debt, duty, or thing is claimed adversely by two or more parties, to compel them to litigate the right or title between themselves, and thereby to relieve himself from the suits which they might otherwise bring against him.
Interpleader
Consolidates claims into a single proceeding.
The interpleader process consolidated all claims against the estate into one court action.
FAQs
Who can initiate an interpleader action?
A neutral stakeholder holding disputed property or funds, with no claim to them, can initiate an interpleader.
What is the main difference between interpleader and impleader?
Interpleader resolves disputes over property by a neutral party, while impleader allows defendants to bring in third parties for shared liability.
What is required for an impleader to be successful?
The defendant must demonstrate that the third party may be liable for all or part of the claim made by the plaintiff.
What is the purpose of impleader in a lawsuit?
Impleader is used by defendants to bring a third party into a lawsuit who may be responsible for all or part of the plaintiff’s claim.
Can interpleader be used in any type of legal dispute?
Interpleader is specific to disputes involving multiple claims on the same property or funds, not for all types of legal disputes.
How does impleader affect the original lawsuit?
Impleader adds a third party as a defendant, potentially changing the dynamics of the lawsuit by sharing or shifting liability.
Is there a specific court that handles interpleader actions?
Interpleader actions can be filed in either federal or state courts, depending on jurisdictional requirements.
Can a stakeholder benefit from filing an interpleader?
Yes, by avoiding multiple liabilities and litigation costs through a single court proceeding.
How do parties respond to being brought into a lawsuit through impleader?
The third party can defend against the claims in the same way as the original defendant, including filing counterclaims or defenses.
Can an impleader action be contested by the original plaintiff or the third party brought into the lawsuit?
Yes, both the original plaintiff and the third party have the right to contest the impleader action, including the basis for alleging the third party's liability.
How does the timing of filing an impleader motion affect a lawsuit?
The timing is crucial; if filed too late, it may be denied for disrupting the proceedings, affecting the defendant’s strategy.
What happens if the court rules in favor of the stakeholder in an interpleader?
The court will determine the rightful claimant to the disputed assets, and the stakeholder is typically discharged from further liability.
What role does the court play in an interpleader action?
The court determines the rightful owner(s) of the disputed property or funds, ensuring a fair resolution based on the evidence presented.
Can impleader be used in all types of lawsuits?
While impleader is common in civil litigation, its applicability depends on the nature of the lawsuit and the relationship between the defendant and the third party.
What legal protections does interpleader offer to stakeholders?
Interpleader protects stakeholders from the risk of double liability by allowing them to ask the court to decide who is entitled to the disputed assets.
What are the jurisdictional requirements for filing an interpleader action in federal court?
In federal court, an interpleader action typically requires diversity of citizenship among the claimants and that the amount in controversy exceeds a certain threshold.
What happens to the disputed property during an interpleader action?
The disputed property is typically placed under the court's control until a decision is made, ensuring it is preserved for the rightful claimant.
Are there any restrictions on who can be brought into a lawsuit through impleader?
The third party must have some liability relating to the plaintiff’s original claim against the defendant for an impleader to be valid.
What is the difference between statutory and rule interpleader?
Statutory interpleader refers to federal laws allowing for interpleader actions under specific conditions, while rule interpleader is based on the Federal Rules of Civil Procedure, each with its own jurisdictional and procedural requirements.
How do state laws affect interpleader actions?
State laws vary in their requirements and procedures for interpleader actions, including who may file, the types of disputes that qualify, and the handling of the disputed assets.
About Author
Written by
Aimie CarlsonAimie Carlson, holding a master's degree in English literature, is a fervent English language enthusiast. She lends her writing talents to Difference Wiki, a prominent website that specializes in comparisons, offering readers insightful analyses that both captivate and inform.
Co-written by
Harlon MossHarlon is a seasoned quality moderator and accomplished content writer for Difference Wiki. An alumnus of the prestigious University of California, he earned his degree in Computer Science. Leveraging his academic background, Harlon brings a meticulous and informed perspective to his work, ensuring content accuracy and excellence.
