Debt Recovery - Commencing Legal Proceedings

Statements of claim, defences, affidavits, plaintiffs, defendants....to the average person these legal terms may be confusing and often times down right intimidating. Unfortunately, these terms are just some of the legal jargon used when someone decides to commence legal proceedings against another person or company. So what does it all mean?

 

The most common reason why someone would commence legal proceedings against another is purely to recover a debt which that person claims is owed to them. Usually a letter of demand is issued to the offending party demanding a certain amount be paid within a certain amount of time or face the possibility of legal proceedings being commenced. In an ideal world the debtor upon receiving the letter of demand would pay the debt and the matter is finalised. Sometimes the debtor will simply ignore the letter of demand because they do not believe the debt is owing or they ignore it because they hope the person issuing the demand will give up and go away.

 

 

If there is no response to the initial letter of demand or if the response is inadeqaute, it may be worthwhile considering commencing legal proceedings. This is done through what is known as a "Statement of Claim". A Statement of Claim is a court document which sets out the facts of your claim in a formal way called  "pleadings". It is very important that the pleadings contained in the Statement of Claim be drafted in a way which identifies a "cause of action". For example, a contractual issue will require pleadings to be drafted to show the existance of a legal contract, performance  or lack of perofrmance that contract, breach and resulting damage while a claim in negligence will require pleadings to be drafted to identify duty of care, breach, causation and remoteness of damage. These are just a couple of examples of claims however there may be other types of claims all of which will require certains elements to be properly pleaded.

 

 

In New South Wales there are a number courts where legal proceedings may be commenced depending on the amount claimed. The Local Court has jurisdiction to hear matters up to $10,000.00 in its Small Claims Division and between $10,000.00 and $60,000.00 in its General Division while the District Court has jurisdiction to hear claims up to $750,000.00 with the Supreme Court having unlimited juridiction. Commencing a claim in the incorrect court may see the statement of claim being dismissed and costs being ordered against the party commencing the claim in some situations.

 

 

Any type of claim must be based on some sort of provable evidence. The evidence is usually in writing and put in the form of an "Affidavit".. Essentially, an affidavit is a person's sworn testimony put down in writing and meeting all the requirements of the Evidence Act. Depending on the jurisdiction, the person who swore the affidavit may be required for cross examination on their affidavit at the time of hearing.

 

 

Generally once a statement of claim has been served, the defendant will usually seek further clarification in a "Request for Further and Better Particulars" before filing their defence or if they do not need clarification on any points, they may just file and serve their defence.. A defence is basically a reply to each individual pleading by either admitting or deny them and must be carefully drafted as often times a general denial may not be sufficient to deny the claim.

 

 

If after all the documents have been filed and served and the matter has not resolved through some sort of settlement, the parties may have to prepare for a hearing and depending on the complexity of the claim, the issues involved and the number of witnesses, the final hearing may take anywhere from a few hours to a few days.

 

 

Whether you want to commence legal proceedings or if you are defending a proceeding, we can assist you every step of the way by helping you identify the issues, enter into settlement negotiations on your behalf, preparing your claim/defence, drafting your affidavit evidence and if necessary advocate on your behalf in court if the matter cannot settle.