Responding to a claim

A letter of demand is a letter from the other party asking for money to be paid. It often warns you that if this is not done they may start a court case to recover the money you owe them.

When you receive a letter of demand, this might be the first time you find out that someone is chasing you for money. 

A letter of demand will usually state: 

• ​​how much the other party is claiming
  
• why the other party believes you owe them money
  
• when the money should have been paid
  
• what the other party will do if you don't pay them by a certain date. 
  

The letter may be sent by registered post or email. The demand can also be made by phone or in person.   

You can respond to a claim verbally, but it is a good idea to put it in writing. For more information and sample response letters see Step by step guide - Responding to a letter of demand. 

If your dispute is about a home loan, personal loan, credit card or consumer lease or other type of credit from a bank or credit provider, you have other options. If you have received a default notice from your lender for a consumer credit contract, see  Loans and credit cards. 

A Statement of Claim is a court document. If you receive one, this means the other party has started a court case against you to try to get their money back, or to recover the cost of repairing the damage to their vehicle caused by a car accident that they say was your fault.

You are called the 'defendant', and the person who started the case against you is called the 'plaintiff'.

If you have been served with a Statement of Claim, you must respond within 28 days. Do not ignore it! If you ignore the Statement of Claim, the plaintiff can apply for default judgment against you to recover the money.  

Reading a statement of claim can be complicated. The plaintiff will outline what they are claiming in the 'Relief' section of the form and the reasons for the claim in the section called 'Pleadings and particulars'

For more information about how you can respond to the statement of claim, see Responding to a statement of claim.

Once a case is started in court, if the plaintiff's claim is about money and you agree with the claim: 

• You could try to negotiate with the plaintiff and try to come to an agreement about settling the matter.  
  
• You could pay the full amount owed and file a Notice of Payment form with the Court, or 
  
• If you agree with the claim but can’t afford to pay it all in one lump sum, you can apply to court to pay by instalments. 

This section has information on how to pay the claim in full, try to negotiate a payment arrangement, or apply to court pay by instalments.  For more information see Paying the claim.

If you settle the case this means that you and the plaintiff agree on how the case should end. You can settle the case at any time if you and the ​​plaintiff come to an agreement.​

If you and the other party reach an agreement, it is a good idea to put the agreement in writing.

If your agreement is that the plaintiff will not go ahead with a case against you, they can file a notice of discontinuance. 

You can as​k the court to make a judgement or order in the same terms as your agreement. This is called a consent judgment or order.

For more information see Settling your case. 

If you believe you don't owe all or part of the claim, you can defend a statement of claim. To defend the claim you must file a document called a defence.

You must do thi​s within 28 days of being served with the statement of claim otherwise the plaintiff can apply for a default judgment against you.

If you disagree, with the claim because you believe the plaintiff, or a third party owes the money, you can file a Defence form and at the same time file a Cross-Claim. It may not always be necessary to file a cross-claim.  

If you want to defend the claim, you have a number of things you can do, including: 

• File a defence
• File a cross claim
• Changing your defence 
• Move the case to a different court

For more information see Defending the claim. 

This section has information about what happens when you defend the claim and go to court. ​

Once you have filed your defence, the court will send you a notice for a pre-trial review.  The pre-trial review is the first time that you and the plaintiff will go into a courtroom.

If the case does not settle at the pre-trial review, it will be listed for a hearing on another date.

For more information see During your case.

This section has information about what happens after a decision has been made about the case at court. 

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

• apply for a review of a registrars decision
• apply to set aside the judgment - if you were not in court when the decision was made
• appeal the decision.

An application for a review or an appeal must be made within 28 days of the decision.

If you lost the case, there will be a judgment against you. The judgment is a court order that you have to:

• pay money if the claim is about a debt or car accident, or
  
• return goods (if the claim is about recovery of goods).

If you lost the case, you may also have been ordered to pay the plaintiff for filing and service fees, professional costs if the plaintiff had a lawyer and interest, if the claim was more than $1,000. 

If there is a judgment against you, you can:

• pay the amount in full, or
• try negotiating with the plaintiff, or
• apply to the court to pay by instalments. 

For more information, see After court.

If there is a judgment against you and you do nothing, the plaintiff may take action to try and make you pay the money or return their goods. This is called enforcement.

There are steps you can take to respond to enforcement action:

• ​Stay of enforcement
• ​Responding to an examination notice or order
• Responding to a writ for the levy of property
• Responding to a writ for the delivery of goods
• Responding to garnishee orders

For more information, see Responding to enforcement.

If there is a default judgment against you because you did not respond to the statement of claim, you may be able to apply to set aside the judgment. For more information, see Step by step guide - Setting aside a default judgment.