There is often a legal solution for any debt predicament – whether it takes the form of an unpaid invoice, loan, wage, or rental fees.
The debtor can be an individual or a company and the dispute can be over a large, small, fixed, or unfixed sum of money – with or without interest payable.
In the area of debt collection litigation, there are typically a number of avenues available through which the debt recovery can be pursued – each with their own corresponding pros and cons and procedural requirements best navigated with the aid of experienced debt collection lawyers.
Informed Decisions in Debt Collection Process From the Get-Go
While it is true that debt recovery litigation is typically where the process leads when communications between parties break down, it would be unwise to suggest that the point where everything falls apart is the only time that you should start to consider the advice of a debt collection lawyer.
On the contrary, the argument can be made that the best time to seek legal advice is well before a dispute starts.
If you cover all of your legal bases armed with the expertise of seasoned debt collection lawyers before a dispute gets under way, the process of resolving the dispute will be far smoother and more cost-effective for you.
Some of the advantages of engaging expertise of debt collection lawyers include:
- The benefit of a well-considered and defensible legal position;
- The expertise of a specialized legal representative who is familiar with your situation; and
- The peace of mind that comes with knowing how the legal process will apply to your dispute.
Whether or not a dispute has happened in your commercial engagements, seeking legal advice from debt collection lawyers as early as possible is the most cost-effective course of action, especially in the long-run.
If anything, contacting a debt collection lawyer early will ensure that you are equipped to make informed decisions.
Why this is a wise course of action, read Contacting a Lawyer From the Start – Is it a Good Idea?
The Queensland Civil and Administrative Tribunal (QCAT)
Returning to the topic of process in civil disputes – if no resolution can be achieved by way of negotiation (between the parties, their lawyers, or otherwise) and the monetary amount of the debt is less than $25,000, the jurisdiction through which the matter can be heard and tried is QCAT.
Typically, QCAT proceedings initially involve the parties representing themselves in the interest of sustaining a level of cost-effectiveness in the proceeding.
Even though the QCAT process is typically far less expensive than formal Court proceedings, many of the filing and hearing processes are similar to formal Court proceedings.
For example, important documents are filed with the Registry and witnesses may be called to give testimonies in support of the positions of parties during hearings.
Often, if the monetary amount exceeds $3,000, QCAT will put your dispute through to mediation.
Generally, if the amount is below $3,000 or the dispute cannot otherwise be resolved through the mediation process, your case will be listed for hearing. In this situation, you will be arguing against the other party’s arguments. You should prepare evidence to support your case through documents or witnesses.
When the Tribunal makes an Order during a hearing, a copy will be given to you and the other party. If the Order requires the other party to pay the debt to you and they still refuse to pay, the Order can be filed in the Magistrates Court and enforced in the same way as a Court Order.
As a practical consideration, even if you may not necessarily need to retain a debt collection lawyer to represent you during the initial stages of a QCAT proceeding, it is a good idea to contact a debt collection lawyer at some point to assess your legal position, advice you on where you stand and what the best next steps would be for you moving forward.
The civil jurisdiction hierarchy of Queensland Courts (sorted by their respective monetary limits for a civil action) is as follows:
- Queensland Civil and Administrative Tribunal: less than $25,000;
- Magistrates Court of Queensland: less than $150,000;
- District Court of Queensland: less than $750,000;
- Supreme Court of Queensland: more than $750,000.
In the context of debt collection litigation and civil disputes, the appropriate Court to hear any given dispute is determined by the amount claimed.
What must also be considered is that there are time limits for the bringing of court actions.
For actions relating to breach of contract or tort, the time limit is typically a period of 6 years.
Debt recovery Court process commences with the filing by a party followed by what is called an originating process which may be one of the following:
- Notice of Appeal; or
- Notice of Appeal subject to leave.
Typically, claims for debts are pursued via a Claim and accompanying Statement of Claim – highly technical court documents which are always best prepared and filed with the Court by a debt collection lawyer on behalf of a party.
Once the Claim and Statement of Claim has been filed against the other party and the other party has been appropriately notified, the claimant will be classified during the hearing of the matter as the Plaintiff, and the other party, the Defendant.
The Defendant will then have 28 days from the time of service of the Claim and Statement of Claim to file a Notice of Intention to Defend and Defence if he or she wishes to contest the claim.
If you find yourself on either side of the process (whether you are contemplating filing a Claim or have had a Claim served against you) – again, the most prudent course of action to take would be to seek legal advice with a debt collection lawyer as early as possible.
If the Defendant contests the Claim with a Notice of Intention to Defend and Defence, the process then progresses to Disclosure and Review in preparation for trial.
If the dispute escalates to this point, it is important that the parties be represented by lawyers to ensure they comply with the processes involved and that they are in a position where they are putting their best cases forward to achieve a favourable outcome.
An important consideration to bear in mind throughout any given dispute resolution process is that if a matter progresses all the way to trial, the Court may order that one party pay the other party’s legal costs either partially or fully.
Default Judgment & Enforcing the Judgment
In the event the Defendant does not file a Notice of Intention to Defend and Defence within 28 days of service, the Plaintiff can apply for a default judgment.
This process is best undertaken on your behalf by a debt collection lawyer in order to ensure that your best case is being put forward in compliance with the highly technical process.
In practice, a default judgment often rules in your favour since the other party has failed to take action and their arguments against your Claim are not heard.
After the judgment has been made, an enforcement warrant can be requested and issued by the Court to recover the debt so long as it is done within 6 years of the Court’s Order.
In circumstances where the Defendant’s capacity to pay the debt is in question, an enforcement hearing can be applied to establish their financial position.
If it is established that the debtor does not have the means to settle the debt, the debt can be redirected.
Sometimes, a connected third party may be served the warrant instead. The third party could be an employee or financial institution.
If this is the case, the warrant might be served directly to them and they will have the option to dispute or respond to the request.
In any case, a Court Order and subsequent enforcement warrant is a compelling mechanism which would put you in the best possible position to recover a debt.
As we have already mentioned, this highly technical process of securing the Order and the process of having it enforced are processes best handled with the help and support of a debt collection lawyer from a reputable law firm.
Reiterating all that has been said above, wherever you find yourself in a commercial enterprise – whether in the first stages, whether you end up being owed a debt, or whether you have just been served by another party with a Claim and Statement of Claim – seeking legal advice from a debt collection lawyer as early as possible is the best way to avoid, resolve, and otherwise mitigate the damage involved in any given legal dispute.
Order Out of Chaos
Here at Corney & Lind Lawyers, we are committed across all of our practice areas to principles of integrity, care, and attention in pursuit of just, redemptive outcomes in all of our dealings and engagements.
If you are facing a matter with legal implications or believe you might in the future, Corney & Lind is the law firm that can secure for you the best possible outcome.
Please, feel free to reach out to us as soon as possible.
We would be delighted to gain the opportunity to assist and represent you in pursuit of your just, redemptive outcome.