JWs are allowed to sue each other.
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w73 11/15 p. 704 Questions from Readers ***Do Paul’s words at 1 Corinthians 6:1-7 mean that under no circumstances should a Christian take to court a case involving a fellow believer?—U.S.A.
There may even be times when Christian brothers conscientiously feel that they could go to court with fellow believers. This might be to obtain compensation from an insurance company. In some countries the law may specify that certain matters have to be handled in a court, such as wills that may have to be probated by courts. But this does not create adverse publicity or bring reproach upon the congregation. In handling such legal matters that would not affect the congregation adversely, Christians can be governed by what they consider to be best under the circumstances.
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w63 3/1 p. 160 Questions from Readers ***In
the case of an accident involving dedicated Christians, would it be proper for one to enter a legal suit against a fellow Christian in order to claim the benefits of insurance that he has?—E. G., United States.If this is the only means by which the one who sustained injury can get the compensation provided by the insurance, it would not be improper; it is up to him to decide whether he wants to take the matter to court or not. This is not the type of situation that the apostle Paul was discussing when he wrote about law suits, as recorded in 1 Corinthians 6:1-8. He was discussing instances in which persons who claimed to be Christian brothers were at odds with each other. The one felt that he had been defrauded by the other. But the apostle wisely showed that Christians ought to be able to settle matters privately, if not directly between the individuals concerned, then with the aid of other mature ones in the congregation.
However, when there is no such animosity between members of the congregation and the legal suit is simply a procedural arrangement required in order to obtain compensation from the insurance company, the situation is quite different. The course to be taken becomes a matter for personal decision.