When there is a dispute over money (funds) or property, and the money or property is held by a person or entity who is not a party to the dispute—such as an insurance company in possession of insurance proceeds or a payment due a business under a contract in which a former employee or business partner claims an ownership interest—the party holding the disputed funds or property may place it in the registry of the court (by filing an interpleader action) and allowing the court to safeguard the funds or property until it determines the rightful owner.

In Illinois, when there is a dispute over funds or property held by a third party not involved in the dispute, the third party can use an interpleader action to deposit the disputed assets with the court. This legal action is used to prevent the stakeholder from being held liable to multiple parties for the same property or funds. The Illinois Code of Civil Procedure governs interpleader actions under 735 ILCS 5/2-409. The stakeholder initiates the process by filing a complaint in interpleader, thereby asking the court to determine the rightful owner of the disputed assets. The court will then hold the property or funds in its registry and provide legal notice to all claimants. The claimants are required to assert their claims in the lawsuit, and the court will adjudicate their respective rights to the disputed assets. This process ensures that the stakeholder is discharged from liability once the funds or property are deposited with the court, and it allows the court to resolve the ownership dispute in an orderly manner.