Inter pleader Suit

SECTION 88 defines an Inter pleader as Where two or more persons claim adversely to one another the
same debts, sum of money or other property, movable or immovable, from another person, who claims
no interest therein other than for charges or costs and who is ready to pay or deliver it to the rightful
claimant, such other person may institute a suit of interpleader against all the claimants for the purpose
of obtaining a decision as to the person to whom the payment or delivery shall be made and of obtaining
indemnity for himself.

In other words, an interpleader suit is one in which the real controversy/dispute is not between the
plaintiff and the defendant, but is rather between the defendants only, who inter-plead against each
other. The plaintiff in an interpleader suit must be in a position of impartiality/ non-arbitrariness.

OBJECTIVE: The primary motive is to get claims of rivals adjudicated, meaning the plaintiff calls for other
defendants to get their claims checked in the court of law.

the decision of the court in such an Inter pleader Suit affords indemnity to rightfully provide the claim to
the party who has obtained favorable judgement from the court. (Groundnut extractions export
development assn. v. SBI (1977) 79 BOM LR 184).

Who can file? Robinson v. Jenkins, (1890) LR 24 QBD 275.

A person with no interest in any debt, or, some money, or, other property (movable or immovable).
Except the charges or costs, and is ready to transfer the possession to the rightful claimant may file
the suit.

Who cannot file? order 35 Rule 5.

An agent cannot sue his principal, tenant, or his landlord to compel them to interplead with persons
other than persons claiming through such principles and landlords. Also, a tenant cannot dispute the
title of his landlord during subsistence of tenancy.

Conditions to be Met: section 88

1) the dispute must involve some debt, or, some money, or, other property (movable or
immovable).
2) Two parties must be claiming it against one another.
3) The person from whom such claims are made must not be claiming interest therein other than
for charges or costs (of case, hence no interest in property or other things), and must be
willing to transfer debt, or, some money, or, other property to the person who wins the suit.
4) No other pending suit should be there where the same rights could be properly adjudicated.

Illustrations as to property:

1) A possesses certain property which is claimed by B and C adversely, if A is willing to transfer the
property to either b or c (as per decision of court) and A does not have any interest in it then A
can file an interpleader suit.

Illustrations as to goods:
 1) A owns certain goods which are claimed by B and C adversely, A has no interest in goods except
charges like freight, rent for accommodation etc. and is willing to transfer the possession to
either B or C (as per decision of court) then he/she can file an interpleader suit.

Illustrations as to debt:

1) A is liable to pay 100 Rs which is claimed by both B and C respectively, A is willing to pay the
amount to either B or C (as per decision of court) A may file an interpleader suit making B and C
defendants. (Order 35 rule 1)
(Order 35 Rule 2) he may deposit Rs 100 in court and absolve himself of liability.
If there is any prior agreement that after B wins the suit, he’ll pay 40 Rs to A then given he has
interested the claim shall not lie.

NOTE

As explained by the court in Jaggannnath v. Tulka hera a court must pay analyse all the prayers present
in the plaint, merely if the plaintiff requires the defendants to interplead each other is not sufficient to
declare it an interpleader suit.

Procedure: Order 35 Rules 1-4

In addition to other statements the plaintiff must state in the plaint that – Rule 1

1) He has no other interest in the dispute other than costs and charges.
2) Claims have been made by the defendants severally, (2 or more defendants is a must)
3) There exists no collusion between plaintiff and any of the defendants.

Rule 2 and rule 6 say that court may order plaintiff to deposit the amount or property in the custody of
court and provide costs incurred by him. Later the plaintiff may be discharged (after awarded costs) of
his liabilities on the first hearing. (He is dismissed from the suit) .

Inter pleader Suits are appealable as “decree” R.G. Orr v. R.M.M.S.T.V.E. Chidambaram, ILR (1909) 33
Mad 220.

Also as per Order 43 Rule 1 (p), a decision under rule 3,4,6 of Order 35 is an appealable order.