This fact sheet is for information only, and applies to NSW. It is recommended that you get legal advice about your situation.
It is recommended that if possible you lodge a dispute in an independent external dispute resolution scheme (EDR) rather than filing a defence in court because in court you are exposed to the risk of potentially expensive cost orders. EDR however is free and stops all court action. You can lodge in EDR if the plaintiff (the company suing you) is a member of a dispute resolution scheme. See our Dispute resolution fact sheet.
This fact sheet only covers filing a defence. You may want to lodge a cross claim or change the venue, as well as a defence. Get legal advice if you believe the plaintiff owes you money.
WARNING: DO NOT ADMIT YOU OWE THE DEBT TO THE PLAINTIFF BEFORE YOU GET LEGAL ADVICE. IT IS RECOMMENDED YOU GET LEGAL ADVICE BEFORE LODGING A DEFENCE. See our Getting help fact sheet.
WHAT SHOULD I DO IF I RECEIVE A STATEMENT OF CLAIM?
Get legal advice. Even if you owe the debt you may have other options! You have 28 days from the date the Statement of Claim is served on you (usually by mail) to file a defence or go to EDR if it’s available.
Read the Statement of Claim and decide whether you need more information to decide whether you owe the debt being claimed. If you need more information, you should write to the Plaintiff (or if the Plaintiff has a solicitor, write to the Plaintiff’s solicitor) and ask for details of the claim. This is called requesting “further and better particulars”.
Examples of further and better particulars, you may request are:
- Details and copies of the documents relating to the plaintiff’s claim eg. copy of the loan contract (or phone contract), account statements
- Details on how the amount being claimed was calculated
As the 28 days you have to file your defence may expire while you are waiting for the further information you requested, your letter should include the following:
- After I have received your replies to the above, I may require additional particulars so I am fully informed of the plaintiff’s claim. If so, I reserve the right to make an appropriate request at that time.
- I assume that I have 28 days from the date the requested particulars are provided to file my defence to the statement of claim. Please advise me immediately in writing if this is not the case.
When you receive the further information, you then need to decide whether you have a defence.
WHAT SHOULD I DO IF I AGREE I OWE THE DEBT?
If you agree you owe all of the debt, you have five options; you can:
- Lodge a dispute in EDR to make an arrangement to pay the debt in instalments on the grounds of financial hardship.
- Negotiate directly with the plaintiff to make a payment arrangement. If an arrangement is agreed to, make sure the court is notified in writing.
- Confess to the debt and make A Notice of Motion to pay by instalments. For details on how to do this see our Making an application to pay by instalments factsheet.
- Ask the plaintiff to agree to discontinue the proceedings in return for full payment of the debt. This arrangement must be confirmed in writing and you should check with the court to determine whether the proceedings have been discontinued.
- Do nothing. The Plaintiff may then obtain a judgment and enforce the debt. See our Enforcement of debts in the Local Court fact sheet.
DEFENDING A CLAIM
If you believe you don’t owe all or part of the debt then you must file a defence. It is no longer possible to file a part defence.
Examples of some common grounds for a defence are:
- The debt has been repaid.
- The debt is statute barred pursuant to the Limitation Act (NSW). For more information see our Recovery of old debts fact sheet.
- You were released by the plaintiff from the debt being claimed
- You were not at fault in the accident
- You were misled about the product or service being provided by the plaintiff
- The product or service was not provided as agreed
- The amount being claimed is inaccurate as previous payments have been made that have not been reflected in the amount being claimed.
If you wish to lodge a defence you will need to complete and file a Defence. See Form 7B at www.lawlink.nsw.gov.au (or search the web for ‘UCPR Forms’).
IMPORTANT: You only have 28 days from the date you receive the statement of claim to file your defence (unless the plaintiff has agreed otherwise).
RISK WARNING: If you are unsuccessful in court you may be liable for costs. Depending on which court you are in these could be very expensive.
NEED SOME MORE HELP?
See our Getting help fact sheet for a list of additional resources.
Last updated: October 2018.