How to Sue a Company?

By Joanne Hue, Updated: 2023-03-23 (published on 2021-11-20)

Suing a company means making a legal claim against the company or an employer. People may make a claim against an employer/company for varied reasons such as breach of contract, discrimination against them, or violation of their rights. Be it any reason, it may be difficult for people to understand and know where to start the process. The companies will try in a way or another to persuade people not to take legal action against them by making either job threats or using their financial power to make legal threats. As a result, most people plan to leave their legitimate claims. This article is going to discuss in detail the different reasons/grounds to sue a company, whether you can file a claim against a company, what are the steps, or whether there is a need to engage a lawyer to sue the company.

Reasons/grounds to sue a company

If you’re wondering how to sue a company then there can be many reasons to sue the company. Some of the common reasons are listed below:

  • Where the company has terminated its employee illegally.
  • Where an employee has suffered harassment working at the company 
  • Where a person has suffered harassment visiting the company as a patron
  • For non-payment of salary or non-return of the money owed
  • Where the company has infringed someone’s intellectual property rights.
  • Where the company breached a contract or warranty.

A few of these reasons to sue a company are discussed in detail below:

Sue a company for negligence

This article will discuss two types of negligence when it comes to suing a company.

  1. Employer Negligence: In the UK, every employer is duty-bound to be in compliance with Health and Safety Executive regulations and other UK laws which provide protection to employees. If an employer fails to take all reasonable steps, he would be deemed duty negligent in providing a safe work environment to his employees. The reasons for negligence could be defective or faulty equipment/machinery, inadequate training, improper background checks like CRB checks, etc. Employer negligence is also known as a workplace injury.

In such cases, you can’t claim damages by filing a regular lawsuit against your employer/company. The remedy is to file a worker’s compensation claim rather than a lawsuit.

  1. Professional Negligence: When a company is involved in providing professional advice or services, it has a duty of care to adhere to industry standards. If it fails to stick to those standards and the consumers suffer due to such negligence, it may be liable for professional negligence. Professional negligence can be in the form of legal negligence (inadequate legal advice as per professional standards), clinical negligence (lack of precautionary measures), accountant’s negligence (consumer suffers harm due to poor financial advice) etc. 

To establish a company’s liability in negligence in any of the above cases, one needs to prove that the company had a duty to care and the company breached that duty. Due to the breach, the damage was caused and such damage was foreseeable.

Sue a company for the bad product (Product Liability)

Whenever a consumer buys any product, there is a general expectation that the product will work as mentioned or advertised and it will not cause any kind of harm to you or any of your family members. But we often see the consumers taking legal action against the seller for unsafe and defective products after using which the consumer got injured. 

As per Consumer Rights Act, the products a consumer buys must fulfill the following:

  • Satisfactory quality: the goods must be of a standard that a reasonable person would regard as satisfactory. The expectations of satisfactory quality may refer to the fitness of the goods for the usual purpose of goods of that kind, appearance, and finish, freedom from minor defects, safety, and durability.
  • Fit for purpose: where a consumer indicates to the trader that the goods are required for a particular purpose or where it is obvious that the goods are intended for a particular purpose and a trader supplies them to meet the requirements, the goods should be fit for that specific purpose.
  • Match the description, sample, or model (As described): when a consumer relies on a description, sample, or model, the goods supplied must conform to it.

The above-mentioned rules also apply to digital content like games, apps, etc. Hence, all products, whether physical, electrical, or digital must comply with the above standards.

  • Who is responsible for the faulty/defective product?

It is the responsibility of the company to ascertain the safety of their products before sending them to production. It has become more crucial to check all the safety measures and compliance with the regulations of the country in which they sell. 

If the product doesn’t comply with any of the above-mentioned 3 criteria, then the retailer will be in breach of the Consumer Rights Act. Meaning thereby that the action will lie against the retailer (the company) who sold the product to you, not the manufacturer.

The date of purchase of the product will determine the legislation that applies:

  • Where the goods were bought any time on or after the date 1st October 2015– the Consumer Rights Act, 2015 applies. This Act applies to contracts between traders and consumers.
  • Where the goods were bought any time on or before the date 30 September 2015– the Sale of Goods Act, 1979 applies. This Act remains applicable to contracts between one business and another business and the contracts that are between one consumer and the other consumer.
  • Remedies:

The 2015 Act provides consumers with a set of remedies over and above the remedies usually available in contract law:

  • Short-term right to reject: If the goods when they were supplied don’t meet the requirements, there is a short-term period during which the consumer is entitled to reject them. The period lasts for 30 days unless the expected life of the goods is shorter as with highly perishable goods. 

The right doesn’t apply in cases where the breach relates to an incorrect installation of goods. If the consumer asks for repair or replacement during this initial 30 days, the period is paused so that the consumer has the remainder of 30 days or 7 days(whichever is longer) to check whether the repair or replacement has been successful and to decide whether to reject the goods.

When a consumer rejects goods he can claim a refund. This would be a full refund or in case of hire, a refund for any part of the hire that was paid for but not supplied. A refund must be given without delay and in any event within 14 days of the trader agreeing that the consumer is entitled to a refund.

  • Repair or replacement: where there is a breach of contract but the consumer has lost or chooses not to exercise his right to reject goods, he will be entitled in the first instance to claim a repair or replacement. The trader must do it at no cost to the consumer, within a reasonable time, and without causing significant inconvenience.

The consumer can’t choose one of these remedies above the other if the chosen remedy is either impossible or disproportionate as compared to the other remedy. Where repair or replacement fails, the consumer is entitled to further repairs or replacements or he can claim a price reduction or the right to reject.

  • Price reduction and the final right to reject: If either repair or replacement is not available or is unsuccessful or is not provided within a reasonable time and without insignificant inconvenience to the consumer then the consumer can choose whether to keep goods and claim a price reduction or return the goods and reject them.

No deduction can be made for the consumer having the goods simply because the trader has delayed in collecting the goods. Nor can a deduction can be made where goods are rejected within 6 months of supply where the goods are motor vehicles.

What are the steps to sue a company?

If an out-of-court settlement is not possible with the company then you may wish to initiate legal action against the company. Given below are the steps to follow to sue a company:

  1. Find out who is liable for your claim
  2. Determine the jurisdiction which means where the company or an employer operates. The place of jurisdiction can also be the place of incident.
  3. Figure out the compensation amount you believe you are entitled to receive by taking legal action. You might think of things like Tribunal claim costs and the lost wages due to dismissal.
  4. Draft a demand letter to submit to the court and the defendant which clearly explains your matter and the damages you are claiming/suing for.
  5. Fill the court forms, pay the court filing fees and register the case with the court
  6. Obtain the court date.
  7. Serve the documents to the defendant.

Or where you decide to engage a lawyer to represent your case, the steps are as follows:

  1. Find out who is liable for your claim.
  2. Figure out the compensation amount you believe you are entitled to receive by taking legal action. You might think of things like Tribunal claim costs and the lost wages due to dismissal.
  3. Engage a lawyer to represent you and act on your behalf.

Do I Need a Lawyer to Sue a Company?

If the legal system of the country gives you a right to represent yourself in court then you don’t need a lawyer. However, when bringing legal action against the company requires knowledge of legal procedures, the jurisdiction of the court, claims, defences etc. A company mostly has an unlimited number of resources, an in-house legal team to fight against such legal actions as compared to persons fighting in an individual capacity. Although you can represent yourself, it is best to engage a lawyer and obtain his legal advice.

How much does it cost to sue a company?

The cost depends on various factors like the amount of claim, the type of case you are fighting, whether you are engaging a lawyer or not, paperwork required to do in different cases. It is not viable to quote the cost to sue a company as it will vary looking at such various factors.

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