5 Steps to Take When You Get Sued

No one wants to get sued. But the numbers say that we live in a litigious society. According to the 2014 Judicial Business report, civil case filings in U.S. district courts grew 4% in 2014 to 295,310 cases. The odds are high that you won't ever face a lawsuit, but the numbers aren't low enough to guarantee that you won't ever be sued, either.

Say your neighbor breaks his leg after slipping on your snow-filled sidewalk. Maybe your dog bites your postal carrier as she's delivering a package. Or maybe you're sued after posting something libelous on your blog about a local business.

What should you do if you're sued? First, don't panic. Here are five key steps that everyone targeted by a lawsuit should take.

1. Determine if You Need an Attorney

It doesn't always make sense to hire an attorney. Lawyers don't work for free. And they don't work cheaply, either. Your case might be headed for small claims court — the courts for cases involving relatively small amounts of money.

Each state's small claims court is different. In Illinois, the most plaintiffs can ask for in rewards is $10,000. In Missouri, that amount is $5,000, and in Kentucky and Rhode Island, the limit is $2,500. If you are being sued for a small amount of money, you're better off representing yourself. Even if you lose, you'll end up paying less than you would for an attorney.

2. If a Lot of Money Is Involved, Contact Your Lawyer

If you're sued for a large amount of money, it makes sense to call your lawyer or find legal representation as quickly as possible.

Dealing with a lawsuit is stressful, but don't put off taking action. The more time you give your lawyer to prepare a defense, the higher your odds of reaching a settlement that doesn't drain your bank account.

Make sure, though, that you hire the right attorney. Interview several lawyers before making your pick. Make sure, too, that the attorneys you interview spell out exactly how they are paid and how much they charge. Ask the attorneys you speak with about the results they've obtained for clients. Ask, too, for referrals from past clients who are willing to share their experiences with the attorneys you are considering.

3. Study Your Insurance Policies

If you're fortunate, your auto or homeowners insurance policies might actually protect you from the claims made in a lawsuit against you. Your homeowners liability insurance, for instance, might pay for the medical expenses that a guest in your home incurs after falling down your steep staircase.

If someone files a lawsuit against you, dig up your insurance polices or call your insurance providers immediately. Ask your lawyer, too, if your existing insurance policies will provide the financial protection you need.

4. Prepare a Defense

If you are heading to small claims court without the help of an attorney, take the time to craft a defense that tells your side of the story. And don't rush. It takes a long time for cases to reach small claims court, often more than a year.

When preparing your defense, print out email messages that support your side of the story. If you have any paperwork or documents that you think helps prove that you are innocent of the claims being made against you? Gather them, too. Use the long waiting period to gather as much evidence as you can to support your claim.

5. Be Ready to Consider a Settlement Offer

Because it takes so long for cases to reach small claims court, many lawsuits are settled before the parties involved ever step before a judge. Usually, this is good news: It allows both the person suing and the person being targeted to get on with their lives.

If the person suing you makes a settlement offer, study it carefully. There are times when paying a portion of what you are being sued for makes sense, both financially and mentally. Remember, going through a lawsuit and arguing your case before a judge takes an emotional toll. You might be happier paying a smaller amount to make this stress disappear, even if you think you are not guilty.

Have you been sued? What steps did you take to protect yourself? Share with us in the comments!

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