In the course of a dispute, once the decision has been made to pursue it through the courts, a statement of claim will be filed to begin the process. In essence, the statement of claim is the first step in the process of litigation. It is a legal document that provides a summary of facts, justifying your case in a dispute. If you are the individual, or business, that files the claim, you will be considered the plaintiff or applicant in the court process. It is also important to note that there can be significant implications if you receive this claim and ignore it. This article will explain the purpose of a statement of claim, and the actions to take upon receiving one.
Purpose and Function of a Statement of Claim
Provided that there are no alternate dispute resolutions available, a litigious approach will be needed to settle a dispute. This can often last months, as court hearings are tedious and are often rescheduled. With this, a statement of claim is essential in beginning proceedings and potentially speeding up the entire court process.
Firstly, a claim of this nature will essentially convey your side of the argument, and why you are taking legal action. The details of your dispute (known as ‘pleadings’ and ‘particulars’) will provide the court with an overview of the dispute before the court process begins. Furthermore, the fact that the other party in the dispute is made aware of your claim will allow them to form their own arguments. This would result in a more fair and just court process. In saying this, the pleadings and particulars provided in your claim are essentially set in stone. Here, any subsequent argument made cannot deviate from what you have provided in your claim. Therefore, it is important that you seek legal advice before drafting your claim.
When drafting a claim, you will also be advised to provide the remedy or compensation that you will be seeking. This is typically in the form of damages. If successful, the court will award you with the compensation that you sought in your claim.
What if I receive a Statement of Claim?
If you receive a statement of claim, act quickly and seek expert legal advice. Ignoring such a claim can lead to significant consequences for you or your business. In particular, the courts will likely view you to have defaulted, and in turn, order you to repay what is demanded by the plaintiff.
Rather, here are appropriate actions that you should consider taking after you have received a statement of claim:
- Negotiate: When a claim is filed, it does not necessarily mean that your dispute will be heard before a judge. You may negotiate with the plaintiff and convince them to withdraw the claim.
- Pay and Concede: Paying the full amount and avoiding subsequent, lengthy court proceedings may be the most appropriate option.
- Defend: If you believe that the statement of claim false, it is within your legal right to dispute the claim.
To Sum Up
Whether you are initiating proceedings, or need to defend your business against claims, you should speak with a specialist lawyer about the best course of action.
If you need any assistance in resolving a dispute, our commercial lawyers are here to help. Just call us at 1300 337 997, or complete the form on this page.
Daniel is a legal intern at OpenLegal, placed in our legal content team. He is currently studying a Bachelor of Laws at the University of Technology Sydney. Daniel's interest lies in economics and media/startup law.
Phil is a director at OpenLegal. He has over 16 years experience working in private practice and in-house counsel in Sydney and London, giving him expertise in employment law, IP, finance, leases, dispute resolution, insurance and contracts.
