interpleader

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interpleader

A legal proceeding in which one holding money and making no claim to it, but unsure as to which of several claimants should receive the money,pays the money into court.This is the normal route taken by an escrow agent or someone else holding earnest money when the buyer and seller both demand the earnest money.The escrow company will name both the buyer and seller as defendants; ask that it be reimbursed out of the money for its costs, usually a small attorney's fee and a court filing fee; and that it be allowed to exit from the fight. The buyer and seller then battle over the funds.
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A statutory interpleader is allowed when "[t]wo or more adverse claimants, of diverse citizenship as defined in subsection (a) or (d) of [28 U.
11) One way to deal with this situation is to file, along with a complaint for interpleader, a draft order to deposit the funds as well as the funds themselves.
Another difference between rule interpleader and statutory interpleader is nationwide service.
Thus, when the federal interpleader statute provides for service by a U.
section] 2361 contains an express provision authorizing the reimbursement of interpleader costs and expenses, most courts recognize that they have the discretion to do so.