The Legal Process of Commercial Litigation
Commercial litigation is a complicated and time-consuming process. For most business disputes it isn’t necessary, but when it is, a good lawyer is crucial to help you through the process. There are 5 main steps that need to be taken to bring a dispute to court, which I will summarise here.
Step #1: Conduct Alternative Dispute Resolution (ADR)
ADR includes mechanisms such as mediation, conciliation and arbitration. These dispute resolution mechanisms should always be the first thing that you consider when encountering a business dispute. Litigation is a last resort, and most commercial disputes are resolved through ADR before the matter needs to be brought to court. Many choose to engage a lawyer for conciliation or arbitration, but for less formal processes like mediation, legal representation is not always necessary. You can find our detailed article on the ADR process here.
Step #2: Initial Assessment
If mediation, conciliation or arbitration do not work, then you will need to engage with a lawyer for initial assessment if you haven’t already. You will need a commercial lawyer to discuss the merits of your case and help you to gather all relevant documents, understand the legal basis of your claim and defense and talk you through the costs involved. In Australian litigation matters, a successful party generally only recovers 50-70% of their legal costs. There is also the issue of time and effort. Litigation matters can go on for months and even years. Your lawyer will explain the risks involved and help you decide whether the benefits of civil litigation will outweigh the costs.
Step #3: Statement of Claim
A Statement of Claim details the parties involved, the case being presented and supporting evidence. In the ACT, it is submitted through the ACT Magistrates Court or the ACT Supreme Court (depending on the value and nature of the claim) either online (preferred), in person or by post. In NSW it is submitted via the NSW Online Registry. Matters involving federal or constitutional law go to the Federal Court of Australia and high-value claims with significant legal issues go to the Supreme Court. Your lawyer will help you choose where to submit it.
After the statement is filed, the defendant has 28 days to respond. The defendant may file a defence, cross-claim, negotiate settlement, or fail to respond, which allows the plaintiff to apply for default judgment. If the defendant negotiates settlement and the plaintiff accepts, then the matter is saved from having to go any further.
Step #4: Discovery Process
The discovery process is where both parties exchange all relevant documents and information. The court treats the duty of disclosure seriously, and any concealment of evidence can result in serious consequences, ranging from financial penalties to adverse inferences or even the loss of their case. The discovery process is typically the most time-consuming one. There may be disputes over what has to be disclosed, in which the Court will intervene. Often, there will also be discovery from a third party who has important documents that are relevant to the case. In that case, a party can apply for the Court to issue a subpoena requiring a third party to produce documents or appear in court. They are legally required to follow the Court’s orders or lodge an objection to producing these documents.
Step #5: Preparation for Hearing
The preparation stage is when all of the evidence gathered in the discovery process is brought together. It involves compiling witness statements, evidence, and expert reports, and organising these materials into a “court book” – the document that forms the foundation of your case at trial.
Commercial litigation is a complex process that requires extensive legal advice. On your end, it requires patience, determination and the ultimate assurance that this is the route that you want to go down. If you have any questions about your litigation case, please do not hesitate to contact us. We are here to help.
DISCLAIMER: This article is for informational purposes only and does not constitute legal advice.