I was recently involved in a frustrating litigation matter where our client was named as Defendant in an action and judgment was obtained against them. They were never served with the Plaintiff’s Claim (we have all heard that before, right?) but no, really, this time they weren’t served.
Our client only became aware of this judgment when a demand letter was randomly sent by the Plaintiff’s lawyer to our client almost a year after the judgment was obtained. What they have been doing for that year is a mystery.
Upon reviewing the Default Judgment (which should have never been issued in the first place), our client was named, but was allegedly served at an address that did not belong to our client. The address belonged to a separate business which is affiliated with our client, but independently owed and separate from our client.
Providing counsel with the proper party, we thought this was the end of the matter for our client. We consented to setting aside the Judgment against our client and were under the impression that the Plaintiff’s Claim would be amended to include the proper party. We were frustratingly wrong.
Upon being served with the Amended Plaintiff’s Claim, we discovered that we were still named in the action, and the entities belonging to that separate business were also now included. Despite knowing we were not involved in this transaction; we are still named. Now our client must pay to defend itself in a matter it should never be brought into in the first place.
How did this happen?
It appears that the Plaintiff failed to obtain proper identification of who they were provided services to, and instead of doing their due diligence in confirming who is responsible, they are now naming multiple parties to allow the Court to decide who is ultimately responsible. Turning the Plaintiff’s problem into the Court’s is not the way to proceed.
It is very important before you provide your services, you know exactly who you are providing those services to, so that if you end up in litigation, you are not trying to figure out who owes you money, as that complicates matters.
If you incorrectly name multiple parties because you have failed to confirm who you provided those services to, there is the potential of having to pay those parties’ costs to defend an unnecessary action, and rightfully so.
It costs time, money, and resources to defend a matter, and its more so frustrating to spend time, money, and resources on a matter where you are incorrectly named.
Getting as much information about a customer/client you are going to provide services to upfront is important to ensure that the Courts time and resources are not wasted, and innocent parties are not dragged into a litigation, incurring those costs, simply because you failed to carry out your due diligence.
Murray Brown, Licensed Paralegal