Change or Transfer of Interests and Abatement
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What Is Abatement?
In general, the word “abatement” deals with the idea of stopping or interrupting an ongoing process. In the legal world, abatement refers to a court process by which a judge orders an action to cease or be suspended due to various factors. For example, a claim may be abated if there has already been a case filed with the same parties and subject matter.
What Is a Transfer of Interest?
Basically, a transfer of interest is when title to property or assets change from one person to another. This is usually accomplished through a sale, though it can also happen by means of a gift. Transfers of interests usually refer to the exchange of real property, such as a home or apartment complex. However, the term can also include non-physical assets as well, such as stocks or copyrights. Transfer or change of interest generally implies that the entire title has passed in full from the original owner to the “transferee” (the recipient of the title).
Will a Case Be Abated If There Has Been a Transfer of Interest?
Traditionally, a case was abated or ceased if the property in question underwent a transfer of interest. However, current laws usually allow a case to continue even if there has been a transfer of interest. Now, federal laws governing civil procedure specifically address the issue of “abatement due to transfer of interest.” Also, many states have laws that allow a case to continue even if there has been a transfer of interest.
In general, a case is no longer subject to abatement simply due to a transfer of interest. If there has been a transfer of interest, a judge can order the action to continue by:
- Retaining the claim in the name of the party who originally owned the interest,
- Substituting the transferee for the original party in the case, or
- Requiring the transferee to participate in the action as a joint party alongside the original party.
Also, many states have passed “revival statutes,” which allow the transferee to revive a claim that was abated due to a transfer of interest. Thus, the justification for having a case be abated due to a transfer of interest has weakened over time. This is because many jurisdictions promote transfers of interest and try to avoid hindering such exchanges.
One common exception to these rules has to do with the involvement of corporations in a lawsuit. If there has been a transfer of interest involving a corporation, and the corporation dissolves or ceases operations, the action will abate without an option of revival. This is because a dissolved corporation is compared to a “dead person.” Therefore, the action cannot continue as such and will be abated.
Should I Hire a Lawyer for an Abatement Based on Transfers of Interest?
If you are facing a legal issue involving a transfer of interest, it is to your benefit to contact a lawyer to discuss your options. As mentioned, the laws regarding abatement can vary from state to state. While most states do not completely abate a case if there has been a transfer of interest, there can be some exceptions to this rule. Therefore, it may be necessary to ask your lawyer what the laws of your jurisdiction state regarding abatements.
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Last Modified: 07-09-2014 09:54 AM PDT
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