If you have been served with a statement of claim, there are 4 steps you need to take.
A statement of claim is the initial document which is filed with a court by a person or company making a claim (the plaintiff) against another person or company (the defendant) to start court proceedings.
The types of claims that may be made include: money owing, damages to a motor vehicle, breach of contract and defamation.
So, what do you do if you’ve been served with a statement of claim?
Step 1. Date of service
Take note of the date you were served with the statement of claim.
Usually, statements of claim are served in person, but you may receive them in the post. Taking note of the date you receive the statement of claim is crucial.
You have 28 days from the date of service to file a defence.
Step 2. Contact your solicitor
Once you receive a statement of claim, you need to contact your solicitor immediately.
If you don’t agree that you owe the amount being claimed, you can file a defence. Your solicitor will prepare and file a defence to ensure the plaintiff does not apply for a default judgement.
A default judgement usually includes the amount of the original claim, interest and legal fees.
Step 3. Do not ignore the statement of claim
Even if you agree that the money is owing, ignoring the claim will make it worse.
You may be able to negotiate a settlement with the plaintiff and possibly pay a reduced amount to settle the matter without any further expense.
You may be able to apply to the court for payment of the debt by instalments rather than paying a lump sum.
Step 4. Negotiations, Mediation and Court
Once a defence is filed, the matter is usually listed for preliminary hearing. However, often claims are resolved by negotiation or mediation.
If the matter can’t be resolved, it is listed for hearing before a magistrate.
Claims of less than $10,000.00 are listed in the small claims division of the Local Court. Generally each party will be required to file written statements rather than giving evidence in person, speeding up the hearing and reducing costs.
What happens if you miss the 28 days and a default judgement is served?
A default judgement usually includes the amount of the original claim, interest and legal fees.
Once a plaintive receives a default judgement, they can apply to the Sheriff’s office to seize and sell your property to satisfy the judgement debt.
The Sheriff may come to your home or place of work and may seize any personal property that they consider is able to be sold to satisfy the judgement debt, such as:
• motor vehicles;
• boats;
• caravans;
• other personal possessions of value.
The Sheriff won’t seize your tools of trade to prevent you from working.
In some instances, you can have a default judgement set aside if you have a reasonable excuse as to why you did not file a defence within 28 days.
If you need advice regarding a statement of claim, contact us. We can answer your most immediate questions over the phone and get you on track to resolving the matter.