Hi Ijaz,

The impedance of a telephone set should match the line impedance, in order to prevent reflections. Obviously, when a second phone is connected in parallel there is a dramatic impedance mismatch. So another method would be to measure the level of the reflected signal.

Note that no simple method can detect a high impedance (both AC and DC) circuit used for 'listening in'. The only way to detect this is by means of TDR, but I'm afraid that does not meet your requirement for "cheap" ;o)

Best regards,
Rob.