The Australian court system: a debt recovery and insolvency perspective

By Andrew Lacey, McCabes

Debtors and creditors who have relationships to businesses or operations in Australia should have a general understanding of Australia’s court hierarchy, which operates in a tiered system. All states have lower courts. In New South Wales, the lowest court is the New South Wales Local Court, which has the jurisdiction to deal with civil disputes for claims up to AUD 100,000. One distinct feature of the NSW Local Court is its Small Claims Division, which hears claims of up to AUD 10,000. It also has less formal procedures and relaxed rules of evidence.

Most states and territories have intermediate courts. In most jurisdictions, these courts are district courts and have jurisdiction to deal with civil claims of up to AUD 750,000, as well as appeals from the local court.

Each state and territory has a Supreme Court. Civil claims exceeding AUD 750,000 are commenced in the Supreme Court. Relevantly, the Supreme Court has an inherent jurisdiction to hear disputes concerning the liquidation and external administration of companies. Within its trial jurisdiction, the Supreme Court has two divisions: Equity and Common Law. The Equity division is administered through case-managed lists, such as the Corporations list. Each list is case-managed by assigned judges, and usually has distinct procedural requirements to ensure the efficient disposal of proceedings.

The Federal Court, the Federal Circuit Court and the High Court of Australia have jurisdiction to hear appeals from State and Territory Supreme Courts as well as all matters of federal law.

Andrew Lacey
McCabes, Sydney, Australia
T: +61 2 9265 32 12
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Andrew Lacey heads McCabes’ litigation and dispute resolution team. He acts for numerous media to large Australian and International businesses across a variety of industries including manufacturing, property, insurance and finance.

McCabes is a multi-disciplinary law firm. With a focus on technical excellence, McCabes provides astute and commercial legal solutions for its clients. By emphasising technical excellence and commitment to quality, McCabes offers commercially relevant legal solutions tailored to the current and future business objectives of its clients. McCabes distinguishes itself from other legal service providers by offering legal services that focus on the client’s needs.

published: March 2014

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