Sued for Trying to Help: Getting a Wrongly Named Party Out of a Claim

A shop owner introduces a customer to a supplier, or offers to help two people resolve a disagreement over a purchase. The deal then goes wrong, and the disappointed buyer sues everyone they can think of, including the person who simply tried to help. Being named in a suit you have nothing to do with is stressful, but the law provides a way out.

Who can properly be sued. A claim must disclose a cause of action against each defendant or respondent. There must be facts which, if proved, would make that person legally liable. In a sale gone wrong, liability ordinarily lies with the party who sold the goods, received the money or made the promise. It does not lie with someone who merely introduced the parties or offered to mediate afterwards.

The mediator's position. Offering to help resolve a dispute does not make a person a party to the original transaction, nor a guarantor of its outcome. Treating peacemakers as defendants would discourage the informal dispute resolution the courts encourage.

How a wrongly named party responds.

• File a response on time. Even if the claim is baseless, failing to respond risks judgment by default.

• Apply to be struck out. Where the claim discloses no cause of action against them, the party can ask the court to strike out their name early, saving time and costs.

• Present the documents. Payment records showing who received the money, messages showing who made the deal, and evidence of the limited role the respondent played.

• Ask for costs. A party dragged into litigation without basis may seek costs against the claimant.

In the Small Claims Court. The Small Claims Court Act aims for quick, fair decisions, and the court can deal with the issue of a wrongly joined respondent early. Raising it at the first opportunity is important.

Takeaways. If you broker introductions or help resolve customer disputes, keep a record of your role and avoid handling money on behalf of either side. If you are sued anyway, do not ignore the papers. A prompt, focused response usually ends your involvement quickly.