Who is a Third Party in a Personal Injury Case?

Who is a Third Party in a Personal Injury Case?

A typical personal injury lawsuit involves one plaintiff and one defendant. However, there are many times when a third party gets involved – either voluntarily or involuntarily. These third parties include third-party plaintiffs, third-party defendants, intervenors, and interpleaders. We explain each one below.

Impleader in Texas Courts

Impleader in Texas Courts

Texas law allows a defendant to bring a third party into a lawsuit. This is referred to as “impleading another party.” This process is necessary when the defendant believes that a party not in the lawsuit holds or shares responsibility for the harm the plaintiff alleges. When this occurs, the defendant who impleads the third party is called the “third-party plaintiff,” and the impleaded party is the “third-party defendant.” 

This procedural tool is available to plaintiffs as well. For example, if a defendant files a counterclaim against the plaintiff, the plaintiff may implead a party they believe is liable for the defendant’s counterclaim.

Let’s put this into context with an example. Phil is visiting his neighbor Don when Don’s dog bites Phil and causes him severe nerve damage. Phil sues Don. However, Don had hired Tricia to train his dog not to bite, so he feels that Tricia is partly responsible for Phil’s injuries. Therefore, he may try to implead Tricia into the lawsuit as a third-party defendant.

Intervenor in Texas Courts

Texas law also allows third parties to intervene in a lawsuit. This means that a third party not originally named in the lawsuit petitions to join the lawsuit. This party is called the intervenor. There are many reasons to intervene in a case. The litigation could impact the intervenor’s rights or interests, or the outcome of the litigation could prevent the intervenor from taking legal action on the same issues in the future. 

A party intervenes by filing a pleading. However, an existing party to the lawsuit can challenge their intervention through a motion to the court. The court will strike the intervenor’s petition to join the lawsuit if it determines the third party does not have sufficient cause to intervene in the suit.

 A court grants the petition to intervene if it finds a “justiciable interest,” which the Texas Supreme Court defines as follows:

“To constitute a justiciable interest, ‘[t]he intervenor’s interest must be such that if the original action had never been commenced, and [they] had first brought it as the sole plaintiff, [they] would have been entitled to recover in [their] own name to the extent at least of a part of the relief sought’ in the original suit.”

In other words, the intervenor must have had the same rights to sue over the conduct at issue as the plaintiff in the existing lawsuit if they had not initiated the lawsuit first. Public policy favors intervention when it can consolidate multiple parties and legal issues into one case rather than separate and independent cases.

Intervenor in Federal Courts

Federal law also provides for intervention also. For example, under the False Claims Act, an employee who is retaliated against for reporting or disclosing that their company violated the Act can sue their former employer for damages. However, the Act also allows the federal government to intervene in the case. This can occur when the employer has engaged in fraudulent behavior and the government is interested in taking action against the employer. The government takes over the prosecution of the case, but the employee is still a party to the lawsuit and is entitled to damages if the employer is found liable.

Interpleader

An insurance company that is faced with competing claims to policy funds may file an interpleader action. This process consists of the insurance company filing a lawsuit, naming the third-party rivals claiming the proceeds, and letting the court decide who is entitled to recover. The interpleader process generally allows the insurance company to be discharged from any liability later on.

Let’s look at a case to illustrate how interpleader works. The example here is based on the Texas Supreme Court case State Farm Life Ins. Co. v. Martinez.

In Martinez, Ed and Linda divorced after 13 years of marriage. As part of the divorce settlement, Ed agreed to make Linda the beneficiary of three life insurance policies. One of those policies was with State Farm for $500,000.

Ed eventually married Toni. He notified State Farm that he was changing the beneficiary of the $500,000 policy from Linda to Toni. State Farm denied this request, stating that it appeared to violate Ed and Linda’s divorce agreement. The insurance company asked Ed to respond to its concern. Before Ed could respond, he passed away. Within weeks of Ed’s death, State Farm received not one but three conflicting claims to the policy proceeds – one from Linda, one from Toni, and a third from Ed’s daughter, Lisa.

State Farm filed an interpleader action, depositing the insurance policy proceeds with the court and naming the three claimants. State Farm then left it to the court to determine the rightful beneficiary. This is an example of interpleader.

Have Questions About Third-Party Process?

The law of third parties in Texas lawsuits is complicated and strewn with legal terms such as impleader, intervenor, and interpleader. However, it’s about having the right parties involved in a lawsuit to settle the litigation once and for all.

If you’ve been injured and are contemplating a lawsuit, our attorneys can make sure the right parties are named in your case.