Be careful who you sue!
In the recent case of Alock v Park Business Centres Ltd, Liverpool County Court (4 September 2014), the County Court has struck out, as an abuse of process under CPR 3.4(2)(b), an action against a defendant (Park Business Centres) which, it held, should have been sued in earlier proceedings.
Following an injury at a business premises, the claimant (C) issued proceedings against six defendants, two of which were in the same corporate group as Park, but not including Park. As the claim unfolded, C discontinued the proceedings against three of the defendants before indicating in his allocation questionnaire that he intended to apply to substitute four further defendants, this time including Park. Despite this apparent intention, he failed to do so, causing the Court to make an Order on 16 January 2013 to “put up or shut up”, which still failed to inspire a response from C.
It was only after the three remaining defendants applied to strike out the first proceedings (alternatively summary judgment) that C applied to add further defendants, including Park. The three defendants obtained summary judgment against C and the first proceedings were dismissed.
Rather than appeal this decision, C started a new claim against Park, which Park immediately sought strike out on the basis that it should have been sued in the first proceedings. The Judge agreed with Park in finding that this was a rare case in which a second set of proceedings against a different defendant amounted to an abuse of process and should be struck out because of C’s unjustifiably over-cautious approach to adding Park as a defendant in the first proceedings, in contrast to its general willingness to sue multiple defendants. In addition, C had failed to comply with the January 2013 order. C had enough information to apply to add Park as a defendant at that stage but failed to do so.
It is not uncommon for parties to struggle in ascertaining which of a group of companies is the correct defendant to issue against. Whilst sympathetic to this difficulty, this decision serves as a reminder to take care in choosing the correct defendant and be aware that, notwithstanding the additional costs issues that will invariably arise, going for the wrong defendant could be fatal to a subsequent claim against the right one.