A common question we hear is do we proceed to QCAT or court to pursue a minor debt. It’s helpful to understand some fundamental differences between the two options to make that decision.
Firstly, the debt must be below $25,000 to fall within QCAT’s minor debt jurisdiction. [Note: Building disputes as an example have a higher monetary threshold]
Legal Representation
QCAT is a lawyer-free jurisdiction as a general rule. You are entitled to have a support person at QCAT but they cannot be legally qualified. If you want a lawyer to represent you, you need to ask permission and it’s not readily given for uncomplicated matters. So be prepared to represent yourself at a mediation and final hearing potentially.
You have an unfettered right to legal representation at court.
Costs
QCAT is generally a costs-free jurisdiction. So if you engage lawyers to assist you or you have incurred legal costs in the matter, QCAT will not award you costs (i.e. order the other party to pay your legal costs). You are limited to recovering your filing fee.
You can certainly seek your costs at court and the court has a wider discretion to grant you costs if you are successful.
Procedure
It’s a simpler process at QCAT. If it’s a minor debt matter and the debtor files a response, it’ll be set down for a compulsory mediation and you’ll be encouraged to resolve the dispute there and then. If that fails to resolve the dispute, the matter will be set down for a final hearing.
The Magistrates Court has a few more steps involved before the matter gets to a final hearing. For matters less than $25,000, the usual disclosure process isn’t required but the court may order the parties to attend a settlement conference (which is similar to a mediation). Either party may request a settlement conference after a defence is filed.
The rules of evidence are relaxed at QCAT making the hearing process easier for the unrepresented litigant in the hearing process. This is not the case at Court. Whilst the Magistrate may offer some guidance, they cannot give legal advice and without lawyers the court process can be difficult to navigate.
It is worth nothing the filing fees are comparable between the two jurisdictions.
A challenge in the court process is controlling legal costs to ensure a commercial outcome. Whilst costs may be ordered, the scale costs which the court is likely to apply will not result in all costs being recovered but rather a percentage which could be around 50-60% of your actual costs. If you can engage a lawyer on a fixed fee or scale fee basis, it will give you some certainty around costs and more peace of mind in the process.
If you are successful in obtaining a decision at QCAT and the debt remains unpaid enforcement is the next step. If you secure a favourable order at QCAT that can be registered as a judgment of the court and from there the enforcement process options are the same.
Ultimately, if you are not looking to engage a lawyer then QCAT is the most sensible approach. If you have any questions or need advice, please contact our office for a no-obligation chat.
The above information is general advice only and you should seek tailored advice about your specific circumstances.
Comments