Which court procedure involves resolving issues through a formal declaration by a court?

The procedure that involves resolving issues through a formal declaration by a court is known as a declaratory judgment. This legal process allows a party to seek a court's determination of the rights, obligations, or legal relationships of the parties involved, without necessarily seeking monetary damages or enforcement actions.

In a declaratory judgment, the court's ruling provides clarity and defines legal standings, which can help avoid potential disputes or litigation in the future. It is particularly useful in cases where parties are uncertain about their positions regarding a contract or a statute and seek judicial guidance.

Other procedures such as litigation involve broader processes where disputes are resolved through trials and other court proceedings, while arbitration is a form of alternative dispute resolution outside of the court system with an arbitrator making binding decisions. Interpleader is a legal procedure that allows a party holding property to initiate an action to determine the rightful ownership among multiple claimants. Each of these processes serves different legal functions, whereas a declaratory judgment specifically focuses on the court's authority to clarify legal uncertainties.