Have you provided services or are you owed money for a service you have provided in the Northern Territory? Have you spoken to the person who owes you money and they have still not paid? Debt recovery can be quite straightforward through the Small Claims Division in the Local Court of the Northern Territory, located in Darwin.

Before commencing legal action, it is sensible first to send a Letter of Demand to the debtor. The Letter of Demand should tell them about the money that is owed and give them a date by which to pay the outstanding amount. If they do not pay by the specified date, you can then consider initiating proceedings through the Small Claims Division.

Checklist:

There are two requirements for taking action against a debtor in the Small Claims Division:

  1. Did the debt arise from goods bought or delivered or labour services rendered or a combination of these?
  2. Is the amount owing between $2,000 and $100,000?

If you answered ‘yes’ to the above questions, then you can take action to enforce your debt through the Small Claims Division.

Step 1: Initiating proceedings

If your Letter of Demand was unsuccessful and you decide to initiate legal proceedings, you will need to fill in a Statement of Claim form. You can find the form at any NT Local Court office or downloaded from their website. Once filled in, you can file the Statement of Claim at the nearest Local Court. 

Step 2: Serving the defendant

You will need to notify the Defendant after filing the Statement of Claim, and serve him or her within 12 months of filing. What this means is that you must give the Defendant the document personally, and not by mail. If you are unable to do this within 12 months, you can ask the Court for an extension of time. 

You will also need to file a Declaration of Service within 28 days of serving the Defendant, if you serve the Defendant yourself. The Local Court is able to arrange this service if you are unable to do so. 

Step 3: If the Defendant Does Not Respond

The Defendant can, within 28 days of service: 

  • Settle the claim,
  • Pay the claim, or
  • File in court a Notice of Defence, Notice of Admission or an offer to pay.
  • You can apply for the Court to award a default judgment against the Defendant if he or she fails to take an action.

Step 4: If the Matter Goes to Hearing

At the hearing, you have the option of representing yourself or having a friend or a lawyer represent you. You will need to prove your case, so critically, you need to bring all the relevant material to support your claim. The Court will give its judgment and make orders against one party once they have heard both parties’ arguments. 

You and the Defendant can still settle the matter ourside of Court up until the judgment is handed down. If you do reach a settlement beforehand, it is important that you show the Court a signed written agreement outlining the terms of your settlement.

Conclusion

LegalVision has a team of great litigation and dispute resolution lawyers who can assist. If you have any questions about debt recovery, please get in touch with us on 1300 544 755.

Dhanu Eliezer

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