What to Do If You Are Being Sued
Chances are, you will never be sued. According to U.S. News and World Report, “[t]here were 278,442 civil case filings in the U.S. in 2012, according to the latest government data.” Though civil litigation is not exactly a rite of passage for most, still the time may come when you need to know how to handle a court summons.
Two things to remember. The first is not to panic. Instead, in most instances, you should consider calling an attorney, seeking legal advice, and deciding with him or her how best to respond to the allegations. The second is, do not ignore the lawsuit.
Under Mississippi court rules, a lawsuit begins with the service of written allegations (called a “complaint”) and a notice or “summons” telling you that you have been made a party to a lawsuit, how much time (typically 30 days) you have to respond, and what can happen if you do not respond. Regardless of the nature or validity of the allegations, lawsuits are serious business and deserve immediate attention.
If ignored, Complaints do not go away. They fester and get worse. Take, for instance, what happened to the two Delaware companies in a case just handed down by the Mississippi Supreme Court. In the case, styled BB Buggies, Inc. et al. v. Leon et al., the Court considered what to do in the face of a Complaint served on these businesses but not answered within the required 30 days. After about five weeks, the Plaintiffs did what the rules allow by taking against the companies a “default judgment” (a judgment for the Plaintiffs based simply on the Defendants’ failure to plead or defend). Once these judgments are entered, they become enforceable.
Thus, in the BB Buggies case, the Defendants scrambled once they learned about the default judgment. They asked the court to set the default judgment aside and let them answer. The trial Court denied the request and the Defendants had to perfect an appeal to the Mississippi Supreme Court. Two years later, the Mississippi Supreme Court ruled on the appeal. It said that, in deciding whether to set aside a default judgment, courts should consider (1) the nature and legitimacy of the defendant’s reasons for his default, i.e. whether the defendant has good cause for default, (2) whether the defendant in fact has a colorable defense to the merits of the claim, and (3) the nature and extent of prejudice which may be suffered by the plaintiff if the default judgment is set aside.
In BB Buggies the Supreme Court found that, although the Defendants did not have good cause for their default, the other factors weighed in their favor. On that basis, the Mississippi Supreme Court reversed and set aside the default. Meanwhile, the cost to the defendants in terms of attorney fees, expenses, and delay was huge. That much could have been avoided simply by answering the Complaint on time!