Published on:

Interpleader Actions in Maryland Personal Injury Claims

Occasionally in Maryland personal injury claims, a situation arises when one or more insurance companies agree to pay their entire policy to the claimant(s), but are unable to do so without exposing itself to potential liability. This situation often occurs when two or more persons are are injured and are competing for a limited amount of insurance. Rather than cut a deal with one of the victims, the insurance company will file an interpleader action.

Generally, An action for interpleader may be brought against two are more adverse claimants, when those claimants claim to be entitled to certain property, said property is within the possession of the Plaintiff, and the claims are such that the Plaintiff may be exposed to double or multiple liability, meaning that the Plaintiff could be subject to pay out more money then is actually in their possession.

An Interpleader Action in Maryland can be filed in state of federal court.

There are two different ways to file an Interpleader Action in Federal Court. The first is using Rule 22 of the Federal Rules of Civil Procedure and the second is using §1335 of the USCS. For our purposes, we should use §1335 to file a Federal Interpleader Action. The reason for this is because Rule 22 requires complete diversity between the Stake-Holder (our firm) and the Claimants (all of the investors). Because the majority of the investors are from Maryland, we would not have complete diversity between Stake-holder and Investors, therefore, making it difficult to interplead under Rule 22. Section 1335, however, only requires that there be diversity between two or more adverse claimants. In this case, because at least one of the claimants is from Alabama, we satisfy the diversity requirement under §1335, therefore permitting the action to be filed in Federal Court.

Interpleader actions in Maryland State court are governed by Md. Rule 2-221. This rule states that after Defendants have had the opportunity to answer the complaint, there are seven possible orders that may be entered.

The only apparent difference between filing the action in State court and filing in Federal Court is that the State Rule specifically lays out in detail the possible prayers for relief, the seven aforementioned orders, as compared to the Federal Rules which leaves this open to determination of the moving party.

For further information on this subject, please contact Steve Silverman for a complimentary consultation.