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Disagreeing with another person or business over a commercial activity can become a commercial dispute. Court litigation should be the last option to resolve a business dispute. Otherwise, you may end up in a lengthy court process against a vexatious litigant Vexatious proceedings can cost you your time, money and reputation. This article will explain your business’ options for vexatious litigants in legal proceedings, such as Civil Restraint Orders (CRO).
What is a Vexatious Litigant?
If someone makes many claims against your business, they may be a vexatious litigant. A vexatious litigant is a person or business who keeps taking legal action against you or other people’s businesses. They do so when there is no merit in the case. This means that the case either has no:
- legal basis, or
- factual basis.
Vexatious litigants sometimes believe they have a claim or simply just want to waste your time and money.
What Are My Business’ Options for Handling Vexatious Litigants?
If your business faces a potential vexatious litigant, it is essential to take some action. Your business resources are precious, so you should not waste these on vexatious litigants.
What Are My Initial Options?
The first option is to check if the person or business trying to claim against you is already on the vexatious litigant list. This is a publicly available list on the government website. If so, their claim can be instantly stuck off. This means you no longer face court litigation.
This guide outlines how to resolve commercial disputes.
The other option to consider is whether it is worth making an early offer to the claimant. Whilst you may believe you have a good defence, making an early offer may save you time and money in the long run. In most cases, you want to avoid going to court. Even if you win your case, there is no guarantee that the other party will (or has the resources to) pay the costs of court orders. Therefore, it is sometimes more sensible to make an early settlement offer.
Can I Get a Civil Restraint Order (CRO) for a Vexatious Litigant?
You may have the option of a Civil Restraint Order for vexatious litigants. This is an option when the litigant keeps making claims against you without merit.
The initial criteria the court will look at are:
- whether the claimant’s claims or applications are without merit; and
- whether they will continue unless someone takes action
A CRO can be a wise option when you face a vexatious litigant. This means they can only make a court claim with the court’s permission.
What Types of Civil Restraint Orders Are Available?
If the litigant meets the initial criteria of the court, you have three options for a CRO. These are:
- limited CRO;
- extended CRO; and
- general CRO.
Which you choose depends on the circumstances and your intentions.
A limited CRO is suitable for stopping the claimant from making further claims in your current proceedings. An extended CRO, however, is suitable where the litigant has made many claims or applications without merit. It applies to specific court claims and can last three years or longer.
A general CRO may be of consideration if the other two CROs are unsuitable and the litigant has made many claims or applications without merit. A general CRO applies to all claims and applications the litigant wants to make.
Can I Get an All Proceedings Order?
When a litigant disobeys a CRO, you can apply to the attorney general and ask them to issue a civil proceeding order. This will make the litigant a vexatious litigant. This requires the attorney to thoroughly investigate the litigants’ previous claims before issuing one.
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Key Takeaways
A vexatious litigant makes claims or applications without merit, which means they have no legal or factual basis. Vexatious litigants waste time and money, so knowing your business’ options is essential. Firstly, you should check if the litigant is already listed as a vexatious litigant so the court can throw the case out. If not, consider making an early offer to settle the claim.
You may be able to take the option of a Civil Restraint Order (CRO). This will depend on the circumstances as the court applies strict criteria for CROs. If you choose this option, there are three types depending on the circumstances. If a litigant disobeys a CRO, you may be able to make an application for an All Proceedings Order.
If you need help understanding what your business’ options against vexatious litigants, LegalVision’s experienced disputes and litigation solicitors can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
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