Which court action is used when a broker believes they are entitled to some or all of the escrow deposit and the deposit is turned over to the registry pending settlement?

• A. Bill of interpleader
• B. Mediation
• C. Declaratory decree
• D. EDO

Answer: (C)

Interpleader is used when the broker, as the holder of escrow funds, faces competing claims and doesn’t know who is entitled to the money. By filing an interpleader, the broker deposits the funds with the court (into the registry) and asks the court to determine the rightful owner. This protects the broker from liability to multiple claimants and puts the decision in the hands of the court, which will allocate the funds to the correct party after resolving the conflicting claims. A declaratory decree, while it clarifies rights, doesn’t specifically handle distributing funds from the registry or resolving competing claims in a single proceeding. Mediation is an alternative dispute-resolution process, not a court action to determine entitlement, and the other option isn’t applicable here. The appropriate action is interpleader.