Think Carefully Before You Sue Everyone In Sight

The recent case of Rainville vs. MTCC No. 1056 et al. provides a useful reminder about how important it is to be careful when naming defendants in a lawsuit.

It is not uncommon for a plaintiff who feels that he has a complaint to sue everyone he can think of who might possibly have had some role to play in the events that gave rise to the complaint.

Sometimes you simply do not have a choice. You know that someone has done something wrong to you but you cannot be sure as to who is actually responsible.

Sometimes you simply do not have a choice. You know that someone has done something wrong to you but you cannot be sure as to who is actually responsible.

Sometimes this is a tactic to bring as many cheque books to the bargaining table as possible in the hope that the more people contribute, the more easily one’s objective in terms of a financial recovery can be met.

Unfortunately, all of this will backfire if the case is one of those few that actually does get to trial and the claim is dismissed as against one or more of the various defendants.

In 1997, Ms. Rainville purchased a condominium townhouse in Etobicoke near Lake Ontario. On inspection and based on the description of the townhouse in the real estate listing, it seemed to have three floors of living space.

After she closed the deal, she discovered that in fact, the townhouse only consisted of two floors.  The third floor, which the previous owner had used as living space, was actually part of a common area.

This meant not only that she had overpaid for the property but also that she had considerably less living space than she had thought.

To make matters worse, she found that the roof of the unit leaked and that water was damaging not only the items she had moved into the third floor (which didn’t actually belong to her) but also other floors.

She sued her lawyer, the property management company, various individuals employed by the property manager, the Condominium Corporation, and members of the Board of Directors of the Condominium Corporation. Initially, she also sued the vendor of the unit although fairly early on, for reasons which were never explained, she abandoned that lawsuit.

The lawsuit started in the late 90’s. It didn’t reach trial until October 2009. The trial took about six weeks. The trial judge’s reasons were released several weeks ago.

In the result, the law firm that acted for her on the purchase transaction was found to have been negligent and about $300,000 was awarded in damages. However, none of the other defendants was found to be at fault and her claim against each and every one of them was dismissed.

While costs have not yet been determined by the court, it is reasonable to assume that her former law firm will have to pay some portion of her costs. That portion may be quite small, given that much if not most of the trial time was taken up in dealing with her claims against the other defendants. It is also reasonable to assume that Ms. Rainville will ultimately be ordered to pay costs in respect of each of the other defendants.

In the result, and taking into account Ms. Rainville’s own legal expenses (she went through a number of lawyers herself between the beginning of the lawsuit and the end of the trial), it is virtually a certainty that she will be paying out many hundreds of thousands of dollars more than she will be collecting from the law firm which was found negligent. In fact, legal costs expended by the parties in this case are almost certainly going to be well into the millions of dollars.

I have already pointed out a few reasons why people start lawsuits by suing everyone in sight. An additional reason may have to do with emotions. Sometimes lawsuits are started by people who are still hot under the collar over what they feel has happened to them. However, it is important to reassess these types of cases in the cold light of day because as time goes by, emotions subside but costs continue to be run up.

Anyone can appreciate the need to reassess a case as it develops and as evidence is generated so that intelligent decisions can be made about how (and if) one should proceed. Part of this analysis has to include a reflection on who has been sued and whether or not a claim asserted against any particular defendant is heading for a brick wall. Otherwise, even a winner can find himself behind the eight ball in a major way.

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