A real party in interest is the party who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit. They are the party who, by substantive law, has the right sought to be enforced.
To be a real party in interest, the interest must be a present and substantial interest, distinguished from a mere expectancy, or a future, contingent, subordinate, or consequential interest. It must be material and direct, as distinguished from a mere incidental interest. The interest must be an interest in issue and to be affected by the decree.
The determination of the real party in interest requires examining the elements of a cause of action, specifically the existence of a right and its violation. The owner of the violated right is typically the plaintiff, and the person responsible for the violation is the defendant. In a criminal action, the People of the Philippines, represented by statutorily authorized agents, are the real parties in interest.
Examples of parties generally considered real parties in interest include:
- Parties to a contract or their assignees and heirs in a suit for violation or annulment of the contract.
- Indispensable parties, who are real parties in interest without whom no final determination can be had.
Examples of those generally not considered real parties in interest include:
- A representative or someone acting in a fiduciary capacity (e.g., attorney-in-fact); the beneficiary is deemed the real party in interest and included in the title.
- An agent acting in their own name for an undisclosed principal, unless the contract involves things belonging to the principal.
- A third party who has not taken part in a contract or compromise agreement, unless their interest is affected (e.g., assignee).
- A corporate officer questioning an illegal search of corporate offices; the right belongs to the corporation.
Every action must be prosecuted or defended in the name of the real party in interest, unless authorized otherwise by law or the rules. If a suit is not brought in the name of or against the real party in interest, the defendant may raise the affirmative defense that the complaint "states no cause of action". Lack of legal personality to sue means the plaintiff is not the real party in interest. A complaint filed against a person who is not a real party in interest should be dismissed for failure to state a cause of action, as any decision against such a person cannot be executed. The concept of standing (locus standi) in public suits is distinct from the real party in interest rule in private suits.