Adding Parties & Claims in Fed Civ Pro - Interpleader, Impleader, Joinder and Intervention

Understanding the Differences Between Impleader, Interpleader, Joinder and Intervention

Federal Civil Procedure on the UBE contains a major section that pertains to adding parties and/or claims to an already existing suit.  There are four subsections relevant to this area of law known as impleader, interpleader, intervention and joinder.   It is imperative to know the distinctions between each of these subsections.

At the outset, it would behoove you to create a chart or graph to capture the distinctions between these four legal mechanisms.  Understanding the nuanced differences between these mechanisms, memorizing necessary vs. permissive joinder, and understanding the difference between intervention as a right and permissive intervention is paramount for success on MBE questions pertaining to this area of the law.  Moreover, while not as common on an MEE essay as personal jurisdiction, subject matter jurisdiction or venue, we can easily see an issue on a Civ Pro MEE in one of these legal subsections.

These legal subsections arise during discovery as new information may shed light on parties and claims that should be added to the ongoing lawsuit in an effort to fully settle the rights concerning property or an incident. The law encourages the consolidation of lawsuits because it reduces the court’s workload and because it expedites the adjudication of rights. It also seeks to avoid inconsistent judgments for lawsuits resulting from the same injury. Consolidating cases that are based on similar facts, parties or circumstances helps to accomplish both goals. Therefore, the Federal Rules of Civil Procedure recognize four different legal mechanisms to achieve this goal: joinder, impleader, interpleader and intervention. These legal mechanisms attempt to expedite lawsuits and to achieve finalization of parties’ rights as quickly and conveniently as possible by adding parties and claims to a pending lawsuit.  For starters, a basic definition of each is necessary.

             Impleader is a process by which a third party is brought into a lawsuit by a defendant. The third party becomes a participant in the lawsuit and is known as a third party defendant.  Interpleader occurs when a third party enters into a lawsuit, usually to determine that party’s rights with regard to property at issue in the lawsuit. Intervention is the process by which a third party is allowed to join a lawsuit. The third party may become a co-plaintiff, co-defendant, or take an independent position in the lawsuit. There are two types of intervention: intervention of right and permissive intervention.  Finally, joinder is the process by which one or more parties or claims are added to a lawsuit. The court recognizes two types of joinder. Necessary joinder occurs when the parties or claims must be added to the lawsuit in order for the suit to proceed. Permissive joinder occurs when the parties or claims are permitted to be added to the lawsuit; if they are not added, the court will still allow the lawsuit to proceed.

Impleader

Impleader is also sometimes known as third-party practice. A plaintiff may file a lawsuit against one defendant, while there is another party who may be responsible to reimburse the defendant for some or all of the judgment sought by the plaintiff.  When a party is brought into an action using the impleader device, it is important to understand that the original plaintiff is not suing third party defendant directly. (Craig is not suing Susan directly.) Rather, the original defendant is trying to pass any judgment against him onto the third party defendant. Therefore, the third party defendant (Susan) may attack either the original plaintiff’s claim (which, if successful, would extinguish the lawsuit) or the original defendant’s derivative claim (which, if successful, would extinguish the impleader).

Interpleader

Interpleader is a procedure that typically involves litigation amongst several parties, where there is a possibility of double liability. Typically, this issue arises when there are claims made on an insurance policy. When an insurance company must pay out the proceeds pursuant to a policy, there may be many potential parties who will argue that they should be the beneficiaries. If an insurance company was to pay some of the parties but it is later revealed that they are the wrong beneficiaries, the insurance company would be forced to pay out twice. Therefore, the insurance company would be subject to multiple liabilities.

The interpleader doctrine which is an attempt to alleviate the confusion and delay by requiring parties known as “stakeholders” to settle their claims in one action is important. In the insurance case above, all of the potential beneficiaries would appear in one action and allow the court to determine to whom the insurance company should pay what amounts. In this manner, the insurance company is protected from the potential of multiple liabilities.

Joinder

Joinder is a process by which parties and claims are added to an ongoing lawsuit. The typical litigation scenario begins with a plaintiff who enters into a lawsuit by suing a defendant. The plaintiff has a claim against the defendant for which he or she seeks some type of relief. However, sometimes another party has a role in the lawsuit, or there may be additional legal claims which arose out of the same controversy. In these situations, joinder may be invoked to combine these parties and claims. As always, it is necessary to properly ascertain whether jurisdiction may be acquired over the parties and claims before trying to join them in a lawsuit.

Permissive joinder occurs when the claims arise out of the same events and they involve the same legal questions. Two or more plaintiffs may join together and sue a defendant. Alternatively, a plaintiff may sue two or more defendants and this joinder is often referred to as "permissive” joinder. Initially, the decision belongs to the plaintiff as to whether to join two or more defendants in a lawsuit or to bring separate lawsuits.

Necessary joinder states that a party is necessary to a lawsuit when one of two conditions arise: (1) the party must be present in order to award “complete relief”, or (2) the party has an interest in the action so that his or her interest cannot be represented and protected without that party appearing in the lawsuit. This also applies when the party's absence may expose other parties to double or inconsistent outcomes.  Your task on the UBE (either in an MEE or an MBE question) is to determine if the party MUST be added or MAY be added.

Intervention

Intervention is the introduction of a nonparty who has an interest in a lawsuit. The nonparty wishes to protect its rights by presenting a claim or defense or both. There are two types of intervention. First, there is intervention as of right, where the party intervening, known as the intervenor, has an interest in property or a transaction which is subject to a lawsuit. The intervenor must show that the judgment of the ongoing lawsuit has the potential to impair his or her interests. The intervenor must show that his or her interests are not represented by either party in the lawsuit. Once this is shown, the intervenor has the inherent right to enter the lawsuit and does not need the permission of a party or the court to do so.

The alternative form of intervention, permissive intervention, allows for intervention where the intervenor’s claim or defense has a common question of law or fact with the ongoing lawsuit. Permissive intervention is subject to the discretion of the sitting court. The court may decide to allow or disallow the intervention in this case.

CONCLUSION

It is extremely important to understand the subtle and nuanced differences between each of the four subsections in the “adding parties and claims” section of Fed Civ Pro.  Success on the likely 3-5 MBE questions in this area of law, and perhaps success on a Fed Civ Pro MEE issue depends on your knowledge of the law. For more information concerning this section of Fed Civ Pro, another area of Fed Civ Pro, or a different legal topic tested on the UBE, please do not hesitate to contact us at PassYourBarExam@gmail.com

GOOD LUCK!