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Home Interpleader Action : Types and Procedure

Interpleader Action : Types and Procedure

 

Interpleader Action: Introduction

At the end of every court proceedings, court will give it’s judgement. The judgement of court opens door for rights and benefits passed to the person in whose favour the judgement was given.

Judgement of court remains In trying to enforce a judgement, different modes may be used where a sheriff seizes or intends to seize goods by way of execution and a person other than the judgement debtor, claims them, the sheriff institute the proceedings to determine whether the property belongs to the judgement debtor or to the third party claimant.

What is Interpleader Action?

Interpleader is a proceeding by which a person, who does not himself claim the property, can protect himself from legal proceedings by calling upon the claimant to interplead, that is claim against each other so that the title to the property , debt etc may be determined.

Interpleader summons procedure is applicable where the goods and/or chattels of a person not named on the writ of fifa is attached and the person comes forward to claim his property.

In such a proceeding the claimant is deemed to be the plaintiff and the judgement creditor the Defendant. In such proceedings, the burden of proof is on the claimant to establish title to the property he claim.

See Olatunde v O.A U(1998) 5 NWLR.( PT.549) 178. SEE ALSO OBUMSELI V UWAKWE (2019) 11 NWLR (PT. 1683).P.208

Interpleader proceedings is regulated by the Sheriff and civil Process Act and the Judgement Enforcement procedure Rules. By order VI Rules 1,2(1), 2(2), 4(1)(2),6(1)(2)(3) of the Judgement you Rules, any claim in respect of attached property shall be made to the bailiff holding the writ or to the sheriff.

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The sheriff shall give information to the Registrar of the court for the division where the property is located.

Upon receiving the information, the Registrar shall caused to be issued to the Plaintiff (judgement creditor) form 42, and shall also issued to the claimant form 43.
If the plaintiff or claimant does not admit to the claim, the sheriff shall apply for issuance of summons in accordance with the provisions of section 34 of the Act.

Upon the application by sheriff, the Registrar shall enter interpleader proceedings in the book of the court and fix a date for hearing and issue to the parties the necessary summons and forms in accordance with the Act.

On the part of the claimant, he is expected depose to an affidavit in support of his claim with exhibits where necessary. The exhibit may include three copies of particulars of his property attached..and the grounds upon which he claims them. The claimant shall include in his particulars his full name, address and occupation.

There is no where it is stated that court must hear oral evidence of parties or that hearing must be by affidavit evidence alone. In other words, there is no special procedure for interpleader proceedings. Court can adopt any procedure it deems appropriate.

Burden of Proof in Interpleader Action

In Interpleader summons procedure, the claimant is deemed to be the plaintiff and the judgement creditor the Defendant.As such, the onus of proof is on the plaintiff to establish title to the property he claims. See Kala v Potiskum(1998) 3 NWLR (PT.540) 1

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Types of Interpleader

a. StakeHolder Interpleader

This is where a person who is under liability for a debt over which he has no personal interest and which is subject to competing claims and over which he is likely to be sued or has already sued will seek reliefs by taking out am interpleader.

The purpose of StakeHolder Interpleader is to avoid paying the money to the wrong persons. In this kind of action, the court determines the right person that the debt will be paid to.

If a debtor doesnt take out Interpleader action, he may end up paying the money twice to the person competing for the debt.

Example: Mr Peter has a building, occupied by Mr. John. Mr John is in arreas of rent for 2 years. Now, assuming Mr. Peter is dwade, and two sons of Mr. Peter comes to Mr. John separately, for the arreas of rent.
Mr. John can commence Interpleader action to determine Who he should pat the money to.

In an action for StakeHolder Interpleader action, for the applicant to succeed, he must established:
That he claims no interest on the subject matter in dispute other than for charge of costs.
That he has not connived or colluded with any of the claimant.
That he is willing to pay or transfer the subject matter to the party as the court may direct.

b. Sherriff Interpleader

In this type of Interpleader, the ownership of the property in which execution is levied or about to be levied is challenged by a third party, on the ground that the property belongs to him and not the judgement debtor.

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The Court call the judgement Creditor who attached the property in dispute and the third party laying claims to the property to substantiate their claims.

Where the third party establishes ownership, the court shall release the property. But where the third party fails, the court shall order the sale of the property that was attached.