Legal Definitions - real party in interest

The term real party in interest refers to the individual or entity who possesses the legal right to initiate a lawsuit. This means they are the one who, under the law, is entitled to enforce the claim being made, even if someone else might ultimately receive the financial benefit if the lawsuit is successful. Many legal systems require that a lawsuit be brought in the name of this real party in interest.

Here are some examples to illustrate this concept:

• Insurance Subrogation: Imagine a situation where your car is damaged in an accident caused by another driver. Your insurance company pays for the repairs to your vehicle. After paying you, your insurance company often gains the legal right to sue the at-fault driver to recover the money it paid out. In this scenario, the insurance company becomes the real party in interest. While the original damage was to your car, and you were the initial victim, the insurance company now has the legal standing to pursue the claim against the at-fault driver because it has compensated you for your loss.
• Lawsuits on Behalf of a Minor: Suppose a child is injured due to someone else's negligence. Because a minor child typically lacks the legal capacity to file a lawsuit directly, their parent or legal guardian will file the lawsuit on their behalf. In this case, the parent or guardian acts as the real party in interest for the purpose of bringing the suit and managing the legal process. However, any damages awarded by the court would legally belong to the child, to be held in trust or managed for their benefit until they reach adulthood.