Like it or loathe it (and most people loathe it), litigation is a key part of our legal system and one best utilised by those who understand it.
Many of you will have contemplated “going to court” at one stage or another. Some of you may have even been to court. The truly unlucky may be involved in a court dispute right now.
I say unlucky because there are very few winners in litigation – those who commence litigation will normally only do so when all else has failed and those who have a matter commenced against them (i.e. you’ve been served) don’t normally appreciate it.
With that in mind, and the immortal words of G.I. Joe in our heads (“Knowledge is half the battle”) your best protection against, and preparation for, litigation is the same: understand how it works and prepare accordingly.
Step 1: where are we and where are we going
For most commercial purposes, the question of “which court are we in” will mean one of 5 different places, only 4 of which are truly courts. We’ve summarised what each of them is, and what kind of matters they hear below:
For the purposes of this article, we are putting NCAT to the side, both because it is not truly a “court” and because it functions quite differently to the others.
For each of the other courts, deciding where you commence your claim (or the appropriate location for a claim commenced against you) will likely be decided by:
- the value sought;
- the legislation relied on; and
- the potential for the claim to increase.
For example, a claim for breach of contract with losses estimated at $700,000 might be commenced in the NSWSC if the Plaintiff (the person commencing the claim) expects that their claim might increase by more than $50,000 before trial. This is to ensure that the final amount the Plaintiff seeks is within the jurisdiction of the court they are in.
Another relevant consideration might be whether another state’s courts are more suitable – but that is a murky topic best left for another day.
Step 2: the originating process
The originating process will either be a “Statement of Claim” or “Summons”. Which document you use will depend on what kind of matter you are commencing – this will be something your lawyer will assist with.
As part of this document, the party will normally list out in numbered paragraphs what it is that they want and why it is that they are entitled to it. Pleadings (the overarching term for these kinds of documents) will normally read quite blunt and sometimes even “boring”. This is because the document should be devoid of emotion and only say what it must to establish the cause of action. Anything more is left for advocacy later in the process.
The originating process, once “filed” with the court is “served” on the defendant(s).
Step 3: responding to the claim
On receiving the originating document, it is the defendants’ job to respond – normally by issuing a defence. That document will be due within 28 days and will typically involve the defendant responding on a line by line basis to the statement of claim and deciding whether to admit, deny or not admit something.
As part of this process you may also believe that the statement of claim is too vague or lacks detail – this is where you might instead see a request for “further and better particulars”. In substance, this is the defendant asking the plaintiff to better explain themselves, so that the defendant can respond accordingly.
Ensuring you have responded appropriately to the originating process is important and can prevent an application for default judgment (i.e. “the defendant does not deny what we say, therefore we should receive what we ask for”).
Step 4: evidence and disclosure
Surprise witnesses and “ace up the sleeve” evidence are tropes best left for the movies because in litigation the aim of the game is full and frank disclosure. Do you have to incriminate yourself? No. Do you have to provide an email with some less-than-helpful relevant commentary to the other party? You betcha.
After you’ve commenced proceedings and the other party has responded you’re likely to have a list of issues which the parties do not see eye to eye on (if you didn’t, you wouldn’t be here). The job of evidence is to support your arguments with facts.
In large commercial disputes, this will normally involve getting direct evidence from those involved in relevant events, in addition to opinion evidence from experts with established experience in a relevant area.
For example, let’s say you are in a dispute about a latent condition claim for excavating hard rock and need to prove that:
- You were on site longer than you anticipated you would be; and
- The rock was much harder than you anticipated.
That might involve the following kinds of evidence:
- Evidence from the tendering estimator of the anticipated time spent breaking rock and on what basis they anticipated that duration;
- Evidence from site management of the actual time spent breaking rock;
- Records from tender of the anticipated rock strength (e.g. a geotechnical report);
- Evidence from a geotechnical engineer of:
- the reasonableness of the tendering estimator’s assumptions; and
- how the rock differed from what was expected; and
- Evidence from an expert planner of the critical path impact of the rock breaking taking longer.
As you can see, even in relatively simple disputes, the kinds of evidence and who you need it from can be much more than you expect.
Step 5: going to court so the court can tell you to go elsewhere
Very often parties to a proceeding will at some point be asked by the Court if they have attempted “Alternative Dispute Resolution”. This takes many forms, but the most popular of them is mediation.
Mediation is a fairly flexible process that normally involves the parties sitting in a room together with a facilitator (or mediator) hashing out the strengths of their case and the weaknesses of the other party’s. Normally, there will be break-out sessions in which the mediator will “flip the script” and pressure test each party’s own case, identifying where there might be weaknesses. This is all in the name of trying to bring the parties closer together and embrace a negotiated settlement.
Often this works, but sometimes it doesn’t at which time we finally get to the step that most people will think of as “going to Court”.
Step 6: the steps of court
With the issues defined, evidence exchanged and prospect of settlement (for now) put behind them, the parties now front up to the judge.
A hearing or trial can take various lengths of time, based on the number of issues in contest, but will involve the parties’ legal advisers advocating their client’s position before a judge.
If there are significant factual matters in contest, this can involve extensive “cross examination” with a party’s witnesses attending the court and giving evidence before a judge. In any event, the judge will consider what the parties have to say and probe matters they think to be relevant.
In all but the rarest cases, the hearing will end with something of an anticlimax – no decision will be made. Instead, the judge will go away for a few months (sometimes longer) and render a decision once they have fully satisfied themselves of the issues.
Step 7: appeal
After all of the above, and after receiving a decision from the Court, you may not like the result.
At that stage, you may start thinking about appealing the decision to a higher court. This is a step that you can take but which requires an appealable error of law. In summary, you can appeal a decision because Judge A applied the law wrong in paragraphs X through Y but not because Judge A said that X happened but you maintain that Y happened.
Practicalities and final remarks
This article has detailed a very direct and simple process for litigation: in practicality it rarely is. There will often be issues about the process of litigation itself and whether the parties are complying with their obligations. This leads to hearings on those more administrative matters (“interlocutory hearings”) which in some cases can take years themselves. Sometimes, you will come up against (or perhaps choose to be) an intransigent defendant, one who does just enough to comply with the court rules but never enough to move the matter at faster than a snail’s pace.
These challenges are what frustrate many and what leads to some of the usual complaints we hear: litigation is expensive, takes a long time and requires substantial emotional and mental investment. That said, when the alternative is not receiving what is due to you, it may be a process worth undertaking.
For every negative (and there are a few) it’s important to recognise that those factors cut both ways and can help play into the strategy of the matter as a whole. Very little litigation “goes the distance” and oftentimes it’s about using the process strategically to encourage a negotiated outcome that you can live with. As with all disputes, a negotiated result is always better than an unknown decision from a third party.
In closing, our (general) advice for budding plaintiffs and unwilling defendants is the same – records, records, records:
- Keep your files up to date and complete;
- Bundle relevant correspondence into appropriate folders;
- Ensure departing employees don’t depart with the only copy of the case-winning correspondence; and
- Take good records of conversations and phonecalls.
But, just as important – bring a strong legal team on board sooner rather than later in any dispute. Hopefully they can help you either avoid the Court process entirely, or if not at least set you up for as much success as possible.
