The interpleader procedure is available under Rule 58 of the Uniform Rules of the Court and Rule 44 of the Magistrate Court Rules.
When can one use interpleader proceedings?
The procedure is available to a 3rd party who is in possession of money or property, which is being claimed by two or more different people and he is not certain as to whom does the property or money belongs to. Or where the sheriff of the court attaches property which belongs to the judgment debtor in a particular case and another person then claims that the property that has been attached does not belong to the judgment debtor but to him, leaving the sheriff in the position of uncertainty.
The 3rd party uses this procedure to request the court to decide which claimant is entitled to that property or money. The 3rd party start the proceedings by serving an interpleader notice on the contesting claimants.
Once the interpleader notice has been issued, proceedings are then stayed pending the outcome.
According to Rule 58(3), the interpleader notice shall:
- state the nature of the liability, property or claim which is the subject matter of the dispute;
- call upon the claimants within the time stated in the notice, not being less than 15 days from the date of service thereof, to deliver particulars of their claims; and
- state that upon a further date, not being less than 15 days from the date specified in the notice for the delivery of claims, the applicant will apply to court for its decision as to his liability or the validity of the respective claims.
Rule 58(4) further states that:
There shall be delivered together with the interpleader notice an affidavit by the applicant stating that:
- he claims no interest in the subject-matter in dispute other than for charges and costs;
- he does not collude with any of the claimants;
- he is willing to deal with or act in regard to the subject-matter of the dispute as the court may direct.
Orders which a court may make in relation to an interpleader matter are set out in Rule 58(6) and are as follows:
- Then and there adjudicate upon such claim after hearing such evidence as it deems fit;
- Order that any claimant be made a defendant in any action already commenced in respect of the subject matter in dispute in lieu of, or in addition to, the applicant;
- Order that any issue between the claimants be stated by way of a special case or otherwise and tried, and for that purpose order which claimant shall be plaintiff and which shall be defendant;
- Dismiss the application if it considers that the matter is not a proper matter for relief by way of interpleader notice;
- Make such order as to costs, and the expenses (if any) incurred by the applicant as to it may seem meet.