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RULE 24: INTERVENTION

July 25, 2011

RULE 24.01: INTERVENTION AS OF RIGHT.

Upon timely application anyone shall be permitted to intervene in an action: (1) when a statute confers an unconditional right to intervene; or (2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant’s ability to protect that interest, unless the applicant’s interest is adequately represented by existing parties; or (3) by stipulation of all the parties.

Advisory Commission Comments. Rule 23 makes the class action available in all fields of civil litigation. The court is required to make an affirmative determination as to whether or not a class action is proper in any given set of circumstances; this determination is subject to alteration at any time prior to judgment on the merits. Criteria governing the court’s determination are spelled out in detail. The rule seeks to secure to the courts and litigants the advantages of the class action while clothing the court with power to protect all members of the class against a miscarriage of justice.

23.06: Tenn. Code Ann. § 48-718 [repealed] contains the provisions of the General Corporation Act relating to shareholders’ derivative suits. Rule 23.06 does not conflict with the provisions of Tenn. Code Ann. § 48-718 [repealed] and will not repeal any of its provisions. The Rule adds a provision, not found in the statute, requiring that the complaint contain an allegation that plaintiff is a holder of shares at the time of bringing the suit, but the Rule does not change the requirement that the plaintiff actually be a shareholder as of that time. The Rule adds a requirement that the complaint set out the reasons that plaintiff’s efforts to obtain desired action from the directors or comparable authority were unsuccessful. The Rule adds a provision that the derivative action may not be maintained if it appears that the plaintiff does not fairly and adequately represent the interests of the shareholders or members similarly situated.

Advisory Commission Comments [2004]. The amendment to Rule 23.03(1) abolishes ex parte class action certifications.

Advisory Commission Comments [2006]. The second and third sentences of Rule 23.05 are new. Objections can be made to attorney fees sought as part of a settlement.

Advisory Commission Comments [2007]. T.C.A. §27-1-125 gives the Court of Appeals discretion to permit an appeal of a trial court’s grant or denial of class action certification. Permission from the trial court is unnecessary.

Advisory Commission Comments [2009]. The Tennessee Voluntary Fund for Indigent Civil Representation is established in Tenn. Code Ann. § 16-3-821.

RULE 24.02: PERMISSIVE INTERVENTION.

Upon timely application anyone may be permitted to intervene in an action: (1) when a statute confers a conditional right to intervene; or (2) when an applicant’s claim or defense and the main action have a question of law or fact in common. In exercising discretion the court shall consider whether or not the intervention will unduly delay or prejudice the adjudication of the rights of the original parties.

RULE 24.03: PROCEDURE.

A person desiring to intervene shall serve a motion to intervene upon the parties as provided in Rule 5. The motion shall state the grounds therefor and shall be accompanied by a pleading setting forth the claim or defense for which intervention is sought. The same procedure shall be followed when a statute gives a right to intervene.

RULE 24.04: NOTICE TO ATTORNEY GENERAL WHEN STATUTE, RULE OR REGULATION IS QUESTIONED.

When the validity of a statute of this state or an administrative rule or regulation of this state is drawn in question in any action to which the state or an officer or agency is not a party, the court shall require that notice be given the attorney general, specifying the pertinent statute, rule or regulation.

Advisory Commission Comments.

24.01: By statute, persons not made parties to a suit, but who have an interest in the matter at issue, can intervene in the suit as a matter of right in a number of situations (e.g., person interested in property which is subject of a suit to recover property (Tenn. Code Ann. § 20-1-115); person interested in property which is subject of eminent domain proceeding (Tenn. Code Ann. § 29-17-610). Rule 24.01 preserves all statutory rights of intervention, and adds the grounds set out in clauses (2) and (3) of the Rule.

24.02: Rule 24.02 preserves all statutory conditional rights of intervention and adds the right to intervene when the applicant’s claim or defense and the main action have a common question of law or fact. Original parties are protected against undue delay or prejudice by empowering the court to deny intervention where necessary to protect these parties.

24.03: Rule 24.03 establishes a uniform procedure for intervention in all cases. If any prior statute specifies a different procedure, the provisions of the Rule will prevail.

24.04: When a declaratory judgment is sought to declare a statute, ordinance, or franchise of statewide effect unconstitutional, it is necessary to serve the Attorney General with a copy of the proceeding and to afford him or her a chance to be heard (Tenn. Code Ann. § 29-14-107(b)). The object of the statute is to protect the public’s interest in the result of the suit [Cummins v. Shipp, 156 Tenn. 595, 38 S.W.2d 1062 (1928)].

Rule 24.04 extends this protection to actions of any type. If the Attorney General feels that the State’s interest so requires, he or she will be in a position to intervene or take other appropriate action.

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