Being Sued

You’ll know you’re being sued when you receive a formal document issued by a court. You should take these documents very seriously. Don’t ignore them.

If you’re being sued and don’t know what to do next, follow these steps.

Download PDF

What to do if you’re being sued

01

Check that the documentation you received has been issued by a court

Sometimes debt collectors will send you documents that look like formal court documents but they’re not actually issued by a court.

The first thing to do is to check that the formal documentation has:

  • the name of the relevant court and a court stamp
  • a court number
  • a section telling you what will happen if you don’t respond within a certain time

If the document has the above information, then a court has issued them.

If you’re unsure whether the court has issued the document, ring the court to check.

TIPS

Depending on where you live, formal documents could be called a ”Claim”, ”Statement of Claim”, ”Complaint” or a ”Summons”.

There are different rules in different courts about how the documents must be delivered to you. The court document can be:

  • handed to you personally
  • left at your address
  • sent by certified mail
  • sent by ordinary post

The document will tell you how long you have to respond. The time to respond varies depending on the State or Territory you live in.

If you’re a tenant and have received a notice to vacate, a notice of hearing or similar, refer to Rent.

02

Understand your options

You have six options once you’ve received a formal notice that you’re being sued. Get legal advice on the best option for you. They are:

  1. Contact the creditor to:
  • negotiate a repayment arrangement
  • dispute the debt claimed

You can negotiate with your creditor even after court action has started. Make sure you get legal advice as it is important that you understand what happens in the court proceedings. If possible, try to negotiate with the creditor for the court proceedings to discontinue or lapse by agreement.

  1. Lodge in external dispute resolution (if available) if:
  • you’re in financial hardship
  • you have a reason why you don’t owe the debt claimed.
    If your creditor is a member of an external dispute resolution scheme, this may be your best option as the creditor cannot get judgment while the dispute is being considered. This is why you need to lodge in external dispute resolution before judgment is obtained. Lodging a dispute in an external dispute resolution scheme may give you the opportunity to negotiate so that no court judgment is entered against you.
  1. Confess to the debt by agreeing you owe the money
    This involves filling in some forms with the court to confirm that you owe the debt. Do not confess to the debt until you get advice.
  2. Defend the court action
    Court procedures are different in each state and territory, but generally you defend the court action by lodging documents (called a “defence”) with the court that set out the reasons you do not owe all or part of the debt (before the time limit given in the claim document). Please be aware that if you defend the action and lose, much higher costs may be awarded against you (including any legal costs for the other party) than would have been the case if you hadn’t defended the court action.
  3. Do nothing and don’t attend court
    This means that your creditor is likely to get a default judgment against you.
  4. Apply to the court to pay the debt in instalments
    Get advice before you do this. Applying to pay by instalments means you are agreeing you owe the debt and a court judgment can be obtained.

03

Call to speak to one of our financial counsellors

Before deciding which option is right for you, call us on 1800 007 007 to talk it through.

We may be able to assist you with options 1, 2 and 6; and we can refer you to appropriate legal advice for the other options.

If you’re feeling overwhelmed and need some help to deal with your financial hardship, you can speak with one of our financial counsellors.

Financial counsellors aren’t judgmental about your circumstances – they’re here to offer you free, confidential and independent advice and assistance.

To speak to a financial counsellor you can:

  • Call the National Debt Helpline on 1800 007 007 – open Weekdays from 9:30 am to 4:30 pm.
  • Use our live chat service by clicking the chat icon in the bottom right corner of your screen. Live chat is available 9:00 am to 8.00 pm weekdays. If you send a message outside these hours a financial counsellor will get back to you.
  • Make an appointment to see a financial counsellor in your local area – Find a local Financial Counsellor.
ndh_ico

You might feel overwhelmed, but you have options and there are steps you can take yourself. But if you feel you need a bit more guidance or need help quickly, simply call us.

CALL 1800 007 007