Prior to 2013, the threshold for bringing a minor civil claim in the South Australian Magistrates Court was $6,000. This was changed to $25,000 in 2013 and recently was changed again to $12,000. The reduction in the monetary limit for minor civil claims came into effect on 1 August 2016.
In 2012 the South Australian Attorney-General introduced the ‘Statutes Amendment (Courts Efficiency Reforms) Bill 2012’ into parliament. The original threshold introduced by the Attorney at that time was to increase the limit of minor civil proceedings from $6,000 to $12,000. One of the purposes of the increase was to keep in line with interstate jurisdictions. In most Australian states the small claims jurisdictional limit is around $10,000 with only Queensland having a limit of $25,000.
Notwithstanding this, during the parliamentary process to pass the legislation the limit was changed by way of amendments introduced in the Legislative Council to $25,000.
The minor civil claims jurisdiction in South Australia does not have the same procedural or evidentiary requirements that apply to general civil claims and importantly, requires claimants to appear without legal representation. That means any increase to the monetary limit of minor civil claims has the potential for increasingly complex matters to be dealt with in court proceedings without the assistance of lawyers being involved or present.
Recently, the Government made a decision to change the limit for minor civil claims once again — this time reducing it to $12,000. As many contractual, leasing, and debt collection matters are resolved in the Magistrates Court, it is important that senior executives with commercial interests in South Australia are aware of any changes to the law for minor civil claims. The changes mean that those matters between $12,000 and $25,000 that had previously been dealt with in the more informal jurisdiction will now proceed as a general civil claim in the Magistrates Court.
The legislation introduced in 2012 also included a requirement that the Attorney-General conduct a review of the operation and impact of the amendments including changes to the monetary limit of minor civil claims.
In accordance with this provision, the South Australian Office of Crime Statistics and Research (OCSAR) conducted a comparative review of statistics of minor civil claims lodged in 2010–2011 and 2013–2014. This review found that during 2013–2014 for minor civil claims lodged of amounts between $6,000 and $25,000 there was:
- an increase in the number and complexity of such claims;
- a possible reduction in the number of days to finalise a defended claim; and
- an increase in the number of days from lodgement of a claim to finalisation.
In addition, a number of respondents provided feedback to OCSAR during the review stating that an increase in the limit to $25,000 had led to a corresponding increase in the time it was taking for Registrars and Magistrates to determine claims in this jurisdiction. An increase in the number of complex matters being dealt with as minor civil claims was considered a significant reason for the additional time being spent by Registrars and Magistrates.
As a result, the Attorney-General introduced the ‘Magistrates Court (Monetary Limits) Amendment Bill 2016’ to change the limit from $25,000 to $12,000 with the aim of reducing court delays by decreasing the number of complex minor civil claims lodged in the South Australian Magistrates Court.
The Bill was recently enacted by the South Australian parliament and came into effect on 1 August 2016. Proceedings already underway in the Magistrates Court as of this date will be unaffected.
Senior executives intending to bring a claim in the South Australian Magistrates Court in either the minor civil claim or civil claim jurisdictions are encouraged to seek legal advice to see whether this recent legislative change will affect their proceedings.