Some people avoid ever setting foot in a court, but society is becoming more litigious by the day. If you own or manage a business, the odds are that you will be involved in a dispute that can’t be resolved by hugging it out at some point. Whether you have to stop someone from doing something, get someone to do something, or claim an amount owed to you, you may have to consider taking legal action. Being involved in litigation can be daunting. It is a world of rules, deadlines, formalities, and excessive jargon. Knowing even a little bit about the process can be the assurance you need to make the right decision.
Here are a few litigation basics that you need to know.
Arbitration
Running straight to a court is usually not the only option available. You can also resolve your dispute outside a courtroom through arbitration if the dispute cannot be mediated. Some contracts make arbitration compulsory but you can always agree to resolve a dispute through arbitration. We highly recommend considering arbitration where significant commercial interests are at stake, especially if you and your foe are in different jurisdictions. Arbitration is not necessarily cheaper than going to court. However, it can be much quicker, less rigid, and more accommodating to the modern commercial environment. Remember that you can not force someone into arbitration if they did not agree to have a dispute resolved through arbitration. With arbitration, you can appoint an arbitrator with the necessary knowledge and skill to deal with your specific dispute. The outcome of an arbitration is called an “award”, and it is binding. An arbitration award can be made and enforced as an order of court through a simple court application.
Courts
If mediation and arbitration can’t solve your problem, you will have to ask a court to intervene. There are a few different courts and many factors that determine which court you will have to approach.
One of the most important factors is the value of your claim or the value of whatever the claim relates to. If your claim is R20 000.00 or less and you are claiming as a natural person (and not as a company, trust or close corporation) the Small Claims Court is available to you.
Small Claims Court
The Small Claims Court is available free of charge without attorneys being involved in the hearing. The hearings are informal, brief, and quicker than most alternative court processes. The outcome will be binding and can be enforced by the local Sheriff.
If you want to make use of the Small Claims Court process, go to the clerk of the Small Claims Court at your nearest Magistrates’ Court and ask for their assistance. The clerks are familiar with the process and can guide you throughout the process. They can explain how to write and send a letter of demand to the party you are suing (usually called the "Defendant") and how to issue and serve a summons on the Defendant.
Even though you can approach the District Magistrates’ Court for claims of less than R20 000.00, the costs of appointing and instructing attorneys to assist you with the complicated procedures can quickly cost more than you are claiming.
Magistrates’ Court
If your claim does not fall under the jurisdiction of the Small Claims Court and is between R20 000.00 and R200 000.00, you will have to approach the District Magistrates’ Court. You can go to the District’s Magistrate’s Court where the claim arose or where the Defendant resides.
For claims between R200 000 and R400 000.00, you will have to approach the Regional Magistrates’ Court. Despite the District and Regional Magistates’ Courts having different jurisdictions in respect of the value of claims, the Courts follow the same rules and procedures and are often at the same location.
These two Courts will be appropriate for dealing with most issues and you can also approach the Regional Magistrates’ Court for something like a divorce order.
Usually, disputes between individuals or small businesses will fall under the Magistrates’ Court’s jurisdiction and your best bet will be to approach an attorney with the capacity and experience required to litigate cost-effectively in the Magistrates’ Court. We always suggest making use of an attorney that regularly litigates in the specific court you have to approach as there are many different practices in different courts. Ensuring that you have someone by your side who is familiar with the court staff, magistrates, and procedures will make a stressful and daunting process seem less challenging and the odds of you or your attorney being caught off-guard will be a lot less.
Litigation in the Magistrates’ Courts tends to cost less than litigation in the High Court or through a formal arbitration process. This does not mean that the Magistrates' Court is appropriate for all claims. Your objective and strategy will determine which route will be the most feasible.
If mediation, arbitration, or the Magistrates’ Courts can not solve your problems, you will have to approach a superior court.
High Court
The High Court has jurisdiction over almost all matters. However, it is strongly advised not to approach the High Court where the value of your claim is less than R400 000.00. If you do, a judge may scold you for not taking a more cost-effective route through the Magistrates’ Court.
The High Court is also the upper guardian in matters involving the best interests of a child, whether it relates to custody or otherwise, and has extremely wide powers in establishing what such best interests are. The High Court also exclusively deals with matters concerning your status, like being declared insolvent or incapable of handling your affairs. At the end of the day, the nature of your issue will be the overriding factor in determining which court to approach.
There are also many other courts e.g. the Supreme Court of Appeal, Constitutional Court, Labour Court, Land Claims Court, and the Sexual Offences Courts, so choose your battleground carefully.
Are you sure you want to litigate?
Litigation must never be your first step if you want to resolve a dispute quickly, without incurring significant costs, and while attempting to preserve the relationship with the person or business with whom you have a dispute. Ordinary non-urgent litigation can take anything from one to five years, or even longer, to reach finality. Apart from the protracted timeframe and financial cost of litigating, you also have to consider the emotional costs of litigation. Are you willing to fight until the end, even if the end is five years down the line? If you are not up to it, you will be well advised to attempt to mediate your dispute to reach a compromise before you pick up arms and step into the arena. Just remember that compromise is a two-way street.
If the different courts, how their jurisdiction works, and the legal jargon that accompanies the process seem too daunting, do not try to do it alone. No one is an island and we all have to rely on others in life. Attorneys spend many years learning the ins and outs of the law and will be able to evaluate your legal problems and advise you on the best way to resolve your dispute.
If you are involved in litigation and are still uncertain about where you stand and how the process works, ask your attorney to explain it. If you are comfortable with the legal process you are involved in you will make your attorney’s work a lot easier, and interactions with your attorney will become meaningful and efficient. Remember that your request for an elaborate explanation may also end up being an expensive exercise.
If you have asked for an explanation and received a mouthful of sexy but unhelpful Latin, you may have the wrong sidekick. It might be the time to consider appointing someone that gives you the confidence you need to be a hero while keeping you from flying too close to the sun. Having the right sidekick does not mean that success is guaranteed, but at least you will know that you did everything in your power to succeed. We all have our buts kicked now and then and knowing you gave it your all makes it easier to get up and try again.
If you want to know more about mediation, arbitration, or litigation, contact us. We will do our best to guide you to Mordor without being eaten by goblins. We have been there a few times and have the scars to show.
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