Brief Fact Summary. Plaintiff sued Defendant for injuries sustained in a car accident. Defendant’s insurer moved to intervene on the grounds that Plaintiff and Defendant were conspiring against the insurer in order to collect on the insurance policy. The trial court denied the insurer’s motion to intervene.
Synopsis of Rule of Law. A party may not intervene in a case unless there will be a gain or loss by the party seeking intervention upon entry of the judgment.
Issue. Should the insurer be permitted to intervene in the cause of action based on the allegations that its insured, the Defendant, was in collusion with the Plaintiff in such a manner as to require the insurer to pay any potential damage award?
Held. No. Judgment affirmed. A third party can only intervene if its interest is so direct that it will either gain or lose by “the direct legal operation of the judgment.” The insurer did not file an answer to Plaintiff’s complaint but rather seeks equitable relief. The Defendant’s insurance company argues that resolving the insurer’s liability on the policy first will be less prejudicial to the insurer because otherwise, the insurer would be forced to pursue further litigation. There is no case precedent allowing intervention on such grounds. Insurers in general are not usually considered real parties in interest are not permitted to intervene. This is to prevent any reference to insurance during the trial. If the allegations of the petition are true, the insurer will not be liable on the policy whether or not Defendant prevails. Its burden of subsequent litigation to determine its rights is not a sufficient reason to allow intervention. The issues of the case can be completely resolved without determining anything on the policy. The complaint alleges only gross negligence and does not make reference to any insurance of the Defendant.
The right or interest which will allow a third person to intervene must be of such a direct and immediate character that the intervenor will either gain or lose by the direct legal operation of the judgment.View Full Point of Law