Disputed debt

Ruapehu Bulletin, Volume 9, Issue 412, 12 November 1991, Page 9

Disputed debt

Consumer Column

BY

ANI

WAAKA

When people say that you owe them money and you think that you owe them nothing or much less than they say, you can find yourself in a sticky situation, Some people will find it easier to pretend there is no dispute and ignore the problem, hoping it will disappear. However, as you will see from this article, ignoring a disputed debf may end up with nasty consequences. If someone says that you owe them money and you dispute this, you must try and sort it out first. If you cannot reach a solution, you should go to the Disputes Tribunal. The Tribunal is a cheap and informal way of solving a dispute. A referee hears your case and makes a decision based on both law and fairness. If you know that you owe the debt and cannot pay it, the best thing to do is to approach the person to whom you owe the money, with the plan of paying the debt off in instalments. They may not accept this, but it is a good way to show that you intend to pay the debt. A person to whom a debt is owed can take the action of lodging a default summons in the District Court. A default summons essentially says to the court that the debt has been incurred

and not paid by the debtor. If you ignore the summons the court will hear the case in your absence and can make a judgment against you for payment. This judgment can be enforced by the District Court and money or money's worth of the debt - and court expenses - can be obtained from you by the court. This can end up being a sum much more than the original debt, once expenses have been added. If you receive a default summons and you do not consider thiat you owe the money, you should contact the District Court and tell them that you intend to defend the debt. This matter can then be transferred to the Disputes Tribunal (if the debt is less that $3,000) to keep expenses to a minimum. If .ihe case is to go to court and you have lodged a notice of intention to defend it, make sure that you go along to the court to have your say. You can represent yourself or get assistance from a Citizen's Advice Bureau, Budget Advice Service, Community Law Centre or a lawyer. Make sure that you deal with debt in the right way - if you feel that you do not owe it, don't ignore it but sort things out as soon as possible. • Ani is now based in the Wellington office of the Ministry of Consumer Affairs. Readers can contact her toll free on (04) 473-4490