Statement of Claim

What is this document?

‘Originating Process’ is a generic term for various documents by means of which a civil litigation is commenced. It is defined by the Civil Liability Act (NSW) to mean “the process by which proceedings are commenced, and includes the process by which a cross-claim is made.”

One of the documents which can start a court case is a statement of claim. A statement of claim is a court document that sets out how much or what the other party claims someone owe them and why they are making the claim. The person who files the statement of claim is called the plaintiff.

An originating process almost always needs to be served to inform the defendant of the case being brought against them, and is the first step in litigation. The requirements for creating and formalising an originating process are as follows (further regulatory information can be found in the relevant Uniform Civil Procedure Rules):

• An originating process must be served to the defendant personally (except in cross-claims against active parties)
• An originating process in the Local Court may be served by delivering it to the defendant’s registered business or residential address and leaving it in the care of a person who appears to be 16 years or older and works or resides at the address OR the Court may serve it by post to the business/residential address.
• An originating process must be served on the defendant within 6 months of filing.
• In the District Court, the originating process must be served within 1 month where the defendant is inside NSW.

What are the options for a response?

When you receive the statement of claim you have a number of options to take within 28 days of being served, including:

File a defence

If you believe you don’t owe all or part of the claim, it is important you file a defence within 28 days of receiving the statement of claim at the same court where the claim was filed.

Filing a defence prevents you from having a default judgment made against you and it can be done at the same time as other actions explained below, such as asking for particulars or filing a cross-claim.

Pay the amount claimed or return the goods claimed

If the statement of claim is relating to money and you agree with the claim, you may: 

• Negotiate an agreement about settling the matter with the plaintiff and have the statement of claim withdrawn. 
• Pay the amount owed and notify the court by filing a notice of payment. The full amount owed will usually include any interest and the costs claimed by the plaintiff in the statement of claim.
• File an acknowledgment of liquidated claim form, which tells the court you agree you owe the money, and then file an application to pay it by instalments. In this case there will be a court judgment against you, so the plaintiff can take action to enforce the judgment.

If the statement of claim is relating to goods, and you agree with the claim, you may: 

• Negotiate with the plaintiff an agreement about settling the matter and discontinuing the case.
• Set out your agreement in writing as terms of settlement and ask the court to make orders according to the terms.

Ask for more information

If you need more information about the matters in the statement of claim, you can write to the plaintiff a letter of request for further and better particulars.

You can also ask the plaintiff for further and better particulars after you file your defence.

If the plaintiff applies for a default judgment against you before responding to your request for more information, you can use your letter asking for further and better particulars to support an application to have the judgment set aside.

Another option you have to ask for more detail about the claim is by filing a notice to plead facts within 28 days of being served with the statement of claim.

You should get legal advice before deciding if you should file a notice to plead facts or a defence.

Negotiate

You can negotiate a settlement of the case with the plaintiff.

Go to external dispute resolution – consumer credit debts

If the claim is relating to a consumer credit debt, you can try an external dispute resolution (EDR) by lodging a complaint to the Australian Financial Complaints Authority (AFCA).

The EDR scheme is a free, independent service for resolving disputes between consumers and credit providers. Consumer credit debts include home loans, credit cards ​and pers​onal loans.

When you make an application to AFCA, you should tell the creditor or their legal representative about it.

If your application is accepted, AFCA will contact the creditor and try to resolve the dispute through negotiation and conciliation. The creditor generally cannot continue with the court case or enforcement action without AFCA’s consent while the dispute is being considered. 

If the dispute cannot be resolved by agreement, AFCA will make a decision. If you agree with the AFCA’s decision, it will become binding on your creditor. If you do not accept AFCA’s decision, you should get legal advice.

It is recommended to try EDR before filing a defence form.

File a cross-claim

If you believe that the plaintiff owes you money or has your goods, you may be able to file a claim against the plaintiff. This is called a cross-claim, and it must be filed within 28 days of the date you have been served with the statement of claim. ​ 

At the same time you file a cross-claim, you must also file a defence, otherwise the plaintiff can get a judgment against you. 

We recommend that you always seek legal advice as soon as possible before taking any steps when you receive a statement of claim.

What is the legal effect of ignoring it?

If you do not take any action within 28 days of being served with a statement of claim, the plaintiff may get a default judgment made against you without you attending court or being notified. The default judgment can then be enforced. 

What documents and information do you need to give your lawyer?

If you have been served with a statement of claim, you should seek legal advice as soon as possible and provide your lawyer with: 

• the statement of claim;
• information regarding the debt or goods claimed;
• information regarding whether the plaintiff owes you money or goods;
• your financial situation;
• whether you are willing to negotiate a settlement with the plaintiff;
• any other information requested by your lawyer.