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JUDGMENT VOIDED: THE NECESSARY PARTIES DOCTRINE
Written by: Stephen Lofaso
Civil litigation is fraught with procedural rules that can destroy the unwary litigant’s case, sometimes even after obtaining a favorable result. Such is the nature of the necessary parties doctrine. The doctrine was created to protect the rights of parties who will be affected by the outcome of litigation, but whom the filing party did not originally name in its complaint. The doctrine builds upon the constitutional requirements that all parties receive notice and an opportunity to participate in litigation affecting their rights.
“A final judgment can be completely voided if a required party was never included in the lawsuit — even after years of litigation, extensive discovery, and significant expense.”
The doctrine, however, can become a nightmare for the unwise and inexperienced litigator. For example, in the case Siska Trust v. Milestone Dev., 282 Va. 169 (2011), the Supreme Court of Virginia dismissed an appeal because the appellant failed to name a necessary party to the litigation. In the case, The Michael E. Siska Revocable Trust brought a derivative action on behalf of Motel Investments of Christiansburg, LLC (“MIC”) against other members for alleged breaches of fiduciary duty. The plaintiff did not name MIC as a party defendant to the suit. The appellees argued that the appeal should be dismissed because MIC was a necessary party that had not been joined. The Supreme Court of Virginia agreed, dismissed the appeal, and voided the trial court judgment.
The necessary parties doctrine is one of many procedural rules that can defeat an unwary litigant’s claim. Litigation, especially amongst business owners, can raise extremely complex issues that can defeat a party’s claim before they even have their case heard on the merits. In other instances, such as the necessary parties doctrine, misunderstanding or not knowing procedural rules can have an even more catastrophic effect than dismissal of a claim before trial. It can lead to the overturning or voiding of a case after it has been fully litigated, tried, and the parties have expended tremendous amounts of money and time. It is for this reason, litigants must seek out experienced counsel who have handled complex issues like the necessary parties doctrine.
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This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer