If you are owed money and have a legitimate case, you can file proceedings in the Magistrates Court of Victoria for an amount up to $100,000.

Recovering a debt you are owed through the Magistrates Court of Victoria requires that the initiating party commences proceedings by filing a document called a Complaint which includes the amount sought, a proper basis certification and an overarching obligations certificate. The Complaint form will need to set out the basis of your claim.

After the matter is filed with the Court, you will need to have the Defendant/Debtor served with the relevant documents.  Service on an individual is required to be in person and generally, a process server will need to be engaged to do this on your behalf. If the debtor is a company, service can occur by posting the Complaint and other relevant documents to the registered office of the defendant.

After the Defendant/Debtor is served with the documents, an Affidavit of Service will need to prepared and filed with the Court. Following this, the defendant/debtor has 21 days to file a Notice of Defence should they wish to dispute the claim.

If no notice of defence is filed within that 21-day period, you, being the plaintiff can seek a judgement in default of defence. If you obtain this, the debt will be formal with the Court and can affect the defendants ability to obtain finance in the future.

If a Notice of Defence is filed, the Magistrates Court will refer the matter to either a mediation or pre-hearing conference. Both processes are rather informal and all parties are required to attend.

A pre-hearing conference is a conference between the parties (and possibly their legal representatives if represented) and a Registrar of the Magistrates Court. The aim is for the parties to engage in negotiations to see if a resolution can be reached. It is also used to clarify the issues in dispute should no agreement be reached.

If a pre-hearing conference is not ordered but a mediation is, there will generally be a mediator from the Dispute Settlement Centre of Victoria who is an impartial person and attempts to engage the parties in negotiations about resolving the matter without the matter proceeding to a final hearing.

If the amount claimed is less than $10,000, the Magistrates Court will generally list the matter for an Arbitration. Arbitration is generally an informal court hearing conducted by a Magistrate who will have the ultimate discretion about how the arbitration is to proceed and the outcome.

If the claim is above $10,000 and fails to settle at a pre-hearing conference or mediation, the matter will be referred to a final hearing. A final hearing is conducted before a Magistrate where the plaintiff must prove all the elements of the case. Parties to a hearing which is proceeding to a final hearing will generally benefit from having legal assistance.

A party who is successful in the case against debtor or a debtor who is successful in a defence against the plaintiff can apply for a costs order against the unsuccessful party. A Magistrate will determine if a cost order is appropriate and will give weight to previous offers made by parties when attempting to resolve the case as well as the strength of the case.

If you have any questions about the above information or you would like assistance, please contact us on 0401 049 809 or at kirk@olympuslawyers.com.au.

The information on this website is of a general nature only. It is not, nor is it intended to be legal advice. You should consult a lawyer for individual advice about your particular circumstances.