Going to court

If you’ve tried to resolve your matter and the other party still won't pay you, you may need to start a court case. 

Preparing and serving a statement of claim form

If you want to start a case for a Small Claim, the first step is to complete a Statement of Claim form and file it in the Local Court. In the Statement of Claim, you must name the person, business, company or organisation that you​ are making the claim against and provide their correct current address. 

For more information see Step by step guide - Completing a statement of claim.

After you have filed your Statement of Claim at court, the Statemen​t of Claim then needs to be served on (given to) the other party (the defendant). For more information see Step by step guide - Serving a Statement of Claim.

Finding and naming the defendant 

As the person starting the case, you are the plaintiff. The person or business you are claiming against is the defendant.

In your Statement of Claim, you must name the person, business, company or organisation that you are making the claim against and provide their correct current address.

It is very important that you start your case against the right person or business and that​ you use the correct name for them.

 If you don't name the correct person or business as the defendant, and the claim has to be amended or withdrawn, you may be ordered to pay their legal costs. Also, court fees will not be refunded. 

 You must have the correct address for the defendant so that you can serve them with the statement of claim. The defendant needs to receive the statement of claim and if you don't have their current address, you may not be able to properly serve the defendant and you may not be able to recover the money they owe you. 

You can make a claim against:

• Individuals
  
• Business/Sole traders/Partnerships
  
• Companies
  
• Incorporated Associations
  
• Government departments
  

​​In some situations, you might need to make a claim against more than one defendant. For example, in car accident cases there may be more than one driver at fault. 

For more information about finding and naming the defendant, see Identify the other party, in Making a claim.

What can you claim?

If you are claiming money, you can include filing and services fees in your statement of claim. You can also add interest on the original amount claimed up to the date you get judgment f​rom the court. This is called 'pre-judgment interest.' You can only claim pre-judgment interest from the defendant if the debt owed is $1,000 or more. For more information see Step by step guide - Working out pre-judgment interest.

You may be able to claim your lawyer's costs and any disbursements you have paid relating to the claim. Disbursements are other expenses you have to pay, such as fees for searches or an expert report.

The Court will decide whether to make the defendant pay you these costs, but the general rule is that the losing party will pay the legal costs of the winning party.

In the Small Claims Division of the Local Court, the winning party's lawyer's costs are restricted and you can only claim up to a maximum amount for different parts of the process. 

To find out the current scale of legal costs, speak to the Local Court registry or get legal advice. 

Changing the statement of claim

If need to change your Statement of Claim after it has been filed and served, you can do this by filing and serving an amended Statement of Claim.

You may need to change your Statement of Claim if:

• you forgot to include some detail or add another defendant
• you need to amend some details in the Statement of Claim
• you need to delete some details from the Statement of Claim.

For more information see  Step by step guide - Changing a statement of claim.

For more information about starting a case, see the following: Checklist - Starting your case. 

For a summary of all of the step by step instructions in this topic see below: 

• Step by step guide - Prepare a statement of claim
• Step by step guide - Working out pre-judgment interest
• Step by step guide - Serving a statement of claim
• Step by step guide - Changing a statement of claim.

If a debt is more than $20,000, you will need to start a case in the General Division of the Local Court

A court case to recover a debt in NSW is dealt with in:

• the Small Claims Division of the Local Court where the claim is for up to $20,000
  
• the General Division of the Local Court where the claim is for more than $20,000 and up to 100,000 (or $120,000 in some limited circumstances)
  
• the District Court or the Supreme Court where the claim is for more than $100,000 (or $120,000 in some limited circumstances)
  
• the Supreme Court where the claim is for possession under a mortgage.
  

Sometimes, court cases that are started in the Small Claims Division can be transferred to the General Division, and cases can be transferred from the General Division to the Small Claims division.

The My Money topics in this website deal with matters only in the Local Court - Small Claims division. If the claim is for more than $20,000 you should get legal advice.

For more information, see Local Court – General Division.

After you file and ser​ve your statement of claim, what you do next depends on how the defendant responds to your claim. 

There are a number of things the defendant may do, including:

• Pay the amount claimed 
  
• File an acknowledgment of liquidated claim
  
• Ask for more information
  
• Negotiate
  
• File a defence
  
• File a cross-claim
  
• Apply to move the case to a different court
  
• Do nothing
  

The next steps in your case will depend on how the defendant responds.

For more information, see The defendant’s response.

You can try to settle the case at any time. If you reach an agreement with the other party, it is a good idea to put the agreement in writing. You will also need to take steps to end the court case.

This section has information on what you should do if you settle your case.

• ​Write down the agreement 
• Stopping the case.

For more information, see Settling your case. 

A default judgment is when the court makes a judgment against the defendant without having a hearing in​​ court because the defendant did not respond to the statement of claim. ​​

Applying for default judgment

You can apply to the court for a default judgment, if you filed and served a statement of claim and the defendant hasn't:

• ​​​​​paid the money you are claiming
  
• filed a defence, or
  
• filed an acknowledgement of liquidated claim form (for a money claim only). 
  

You must wait until 28 days after the statement of claim was served. 

If you don't apply for a default judgment within nine months of filing the statement of claim, and nothing else happens in your case, the court can dismiss your case because nothing has been done about it. If this happens, you can restart your case by filing and serving a new statement of claim. Time limits apply.

If you have a default judgment and the defendant still does not respond, there are steps you can take to get the money you are owed. This is called enforcement. For more information, see Enforcement.

If the defendant has paid some of the money you are claiming, you can still get a default judgment for the money not yet paid.

If the defendant has paid the original debt, but has not paid fees or any interest, you can get a default judgment for the amount of the interest and fees. 

For more information about how to apply for default judgment, see Step by step guide - Applying for default judgment.

Responding to application to set aside default judgment

If you have a default judgment, sometimes the defendant will make an application to the court to set aside (cancel) the judgment. This gives the defendant time to file a defence and have the case heard by the court.

This usually happens if the defendant says they did not receive the statement of claim or something stopped them responding to it within 28 days (for exam​ple, they were sick or overseas).

The application will usually also include an application for a stay of enforcement. A stay of enforcement (sometimes called a stay of proceedings) is an order of the court that stops you from enforcing the judgment debt for a period of time.

To have the default judgment set aside the defendant must show the court that: 

• ​there is a good reason why they didn't file a defence within 28 days; and
  
• they have a bona fide (genuine) defence.   
  

To find out how to respond to an application to set aside the default judgment, see Step by step guide - Responding to application to set aside default judgment. 

What happens next?

If you have a default judgment and the defendant still does not respond, there are steps you can take to get the money you are owed. This is called enforcement. For more information, see Enforcement.

Use this checklist to follow the steps involved in getting a default judgment, Checklist - Getting default judgment.

If the defendant files a defence, the court will send you a notice for a pre-trial review. 

Pre-trial reviews are dealt with remotely in the Small Claims Division unless the Court has granted leave (permission) for the parties to appear in person. 

The pre-trial review is your first da​y in court. It is an opportunity for you and the the other party to settle the case. If your case does not settle, the magistrate or registrar will make orders to get your case ready for hearing.​​​​

For more information, see Pre-trial review. 

After the pre-trial review, your case will be listed for a hearing. 

If you and the other party didn’t settle your case at the pre-trial review, your case will be listed for a hearing. At the hearing you will be given the chance to present your case to the court.

A magistrate or an assessor will consider all the evidence and submissions from you and the other party, and then make a decision.

For more information, see The Hearing. 

If you win your case at a hearing, there will be a judgment against the defendant. There will also be a judgment against the defendant if:

• they acknowledge your claim
• they do nothing to defend your claim
• they settle the case in your favour.

You are called the judgment creditor and the defendant is called the judgment debtor.

The defendant might:

• pay the judgment or return the goods
• ask to pay by instalments
• apply to set aside the default judgment
• apply for a review
• appeal, or
• do nothing.

​If you lose your case, the defendant will not have to pay your claim or return the goods. The Court may order you to pay the defendant's legal costs.

If you are unhappy with the Court’s decision, you may be able to:

• apply for a review of a Local Court decision
• appeal the Local Court decision.

Before you appeal a decision, you should get legal advice. If your appeal is unsuccessful, it is likely that you will be ordered to pay the other party’s legal costs.

For more information, see After court.