What are Instalment Orders?

Following your attempts to recover a debt, firstly through a Letter of Demand and subsequently after the debtor has been “served” the Statement of Claim papers, the court’s jurisdiction will come into play.

The Statement of Claim gives the defendant 28 days after service of the document to pay the debt, come to an arrangement with the plaintiff for payment of the debt by way of instalments, or file a defence to the claim.

Instalment orders ­– Stay of Execution

At any time following the entering of judgment, a debtor may apply to the Court to pay the judgment debt by instalments.

The debtor will indicate to the court an amount they can pay either weekly, fortnightly or monthly to the creditor but the creditor has the option to object to the instalment orders by making an application to the Court.

If there is an objection, each party must make submissions before a Registrar as to the appropriateness of the order.

While an instalment order is in place, the judgment to pay the debt in full will be stayed and cannot be enforced. But if a debtor fails to make payments in accordance with the instalment order, the creditor can file an Affidavit of Non-Compliance in the Court registry, which will lift the stay and allow enforcement of the judgment debt.

Generally the Local Court will only allow an instalment arrangement if the debt is to be paid within a couple of years.

Written by Jamal Bakalian

After studying a double degree in Law and International & Global Studies at Sydney University, Jamal completed her GDLP at the College of Law. She is currently undertaking her Masters of Law (majoring in Commercial Litigation). Jamal has been practicing Law for 5 years. With a passion for resolving disputes, Jamal is a valuable member of the Commercial Litigation team at Streeterlaw.

Call us on 02 8197 0105 to book an appointment with Jamal Bakalian!