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When a dispute arises, it is important to understand that litigation is not the only option for solving a conflict. Negotiation, settlement and mediation are some alternatives to litigation which the client should be made aware of. It is up to the clients to decide which means they would like to use in order to reach a settlement. A solicitor has an important role to advise on alternatives in comparison to the outcome that can be achieved in court.

In civil litigation when a dispute is caused by debt, the process usually commence with the creditor serving the debtor a “Letter of defense” requiring payment. The “Letter of defense” is supposed to give the defendant a chance to reach settlement by paying the debt. If payment is not provided, proceedings should be commenced.

The process starts with the drafting of a “Statement of claim” by the plaintiff. It must cover information about which the parties in the dispute are, the cause of action, the wrongful conduct of the defendant, the damage made and the claims. After the “statement of claim” has been finalized, it has to be filed at the local court and a filing fee has to be paid. The next step in the process is to serve the “statement of claim” on the defendant, which has to be done within six months of the filing date.

The service of documents constitutes an important part of the process, if it is not done correctly the documents cannot serve as evidence in court. Service to a private person can be made by personal service directly to the party, ordinary service to the party’s residence or business and substituted service which can be decided by court if personal service seems impractical and special arrangements are required. When the party that is to be served is a company this can be done by post to the registered address.

The defendant needs to file a “defense” at the local court within 28 days from the date when the “Statement of claim” was served. If the “defense” is not filed, the plaintiff can apply to the court to get a “default judgment” which is a judgment for the full amount of the claim. The defendant can also choose to file a “cross claim”, this is usually done when the defendant believes that a third party or the plaintiff owes them money which is part of the debt.

The plaintiff can choose to file an answer to the “defense”, this can be done in order to file additional information which can be used as evidence later during the proceedings.

A “pre-trial conference” is hold in order to examine the dispute and discuss matters such as which the legal issues are in the dispute and if it can be solved by other means than trial. A timetable showing the process needs to be prepared and brought to the “pre-trial conference”. A date will be confirmed for the “Status conference” which is to be held seven months after the filing of the “statement of claim”.

The “Status conference” is to be held before a registrar, during which both parties should be ready to decide a “hearing” or “arbitration” date.

The final step of the process of civil litigation is the “hearing” or “arbitration” during which a judgment is obtained regarding the matter. The District Court in Sydney usually assign trial dates within one or two months after the “Status conference”. The judgment needs to be enforced in a way suitable for receiving payment for the debt.

For more information and legal advice regarding this subject, call our experienced solicitors on (02) 9233 7776 or email us.

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