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Filing a defence against a creditor in the Magistrates' Court

Find out how you can file a defence against a creditor if you owe a debt.

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Filing a defence

If a creditor has commenced proceedings against you in the Magistrates’ Court to recover a debt, and there is a legal reason why you do not have to pay some or all of the debt, you can lodge or file a defence within a limited time.

You should get legal advice if you want to file a defence.

Defences you can use

You may have a defence to a claim if:

  • the creditor acted unconscionably (unfairly)
  • when you agreed to the credit contract you could not afford to repay and the creditor knew this
  • the contract has unfair terms
  • you are not named in the loan contract or the guarantee
  • you do not owe the debt
  • you are under 18, or were under 18 when the debt was made
  • you did not have the mental capacity to agree to a contract when the debt was made
  • you felt you had no choice but to sign, for example, you were threatened
  • the amount the creditor says you owe is wrong (note: the court will let the creditor fix an accidental error)
  • court action against you has been started outside the time limit for the creditor to act.

Time limits

You have a limited time if you want to lodge a defence against a creditor’s complaint to a court.

For example, you must lodge a defence within 21 days if you have received a Complaint Form 5A from the Magistrates’ Court, even if you wish to negotiate or claim hardship.

If the court date is in the future, you still have some choices. You can get help to try to negotiate the debt or claim hardship.

Make sure you get legal advice quickly if you want to file a defence.

How to file a defence

If you want to defence the claim you will need to go to court.

Follow these steps:

  1. To file a defence at the Magistrates’ Court you will need to fill in the Notice of Defence Form 8A that came with the complaint and take it to court.
  2. You will also need to read the overarching obligations. These can be found in sections 16 to 26 of the Civil Procedure Act 2010
  3. Once you have read and understood your obligations, you must complete both of the following Magistrates' Court forms. These certify that each of your allegations or denials in your defence has a proper basis:
    1. Form 4A Overarching Obligations Certification
    2. Form 4B Proper Basis Certification.

You can get legal help to fill these forms in and for the other advice.

What happens next

The court will usually set a time for a pre-hearing conference or mediation. After this, if you and the creditor cannot agree you will be given a date for a final hearing.

The court will write to you telling you the date and time of the hearing. Get legal advice before going to court.

Note: in the Magistrates' Court, claims under $10,000 may be sent directly to arbitration, which is a special kind of hearing.

If you do not file a defence

If you do not file a defence within 21 days of being served with the creditor's complaint, then the creditor can apply for order to be made against you. This is called default judgment.

There will be a record of the court order but you will not be told about it.

The creditor will then have several options to try to get the debt paid back.

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