Time limits most commonly missed in relation to instruments, a claim example and lesson learned.
ActionLeave to defend a claim brought on a dishonoured cheque
Time limit16 or 21 days from the service of writ
Legislations.5 Instruments Act 1958 (Vic)
Extension availabilityThe court can set aside any judgment and grant leave to defend if it appears to be reasonable to do so – s.6 Instruments Act 1958 (Vic)
A practitioner acted for the defendant in Magistrates Court proceedings brought under the Instruments Act 1958 (Vic), where the plaintiff sued on a dishonoured cheque drawn by the defendant.
According to the defendant, the plaintiff had agreed to lend a sum of money to a relative of the defendant. The plaintiff wanted to hold a cheque from the defendant as security for repayment. The defendant drew a post-dated cheque and gave it to the plaintiff but the monies were never advanced and the defendant stopped the cheque.
The plaintiff alleged that the loan was always intended for the defendant not the relative and that the money was duly given to the defendant.
Four days after consulting the defendant, the practitioner wrote to the plaintiff’s lawyers to advise the defendant intended to apply for leave to defend the claim. However, the practitioner failed to apply for leave and judgment was subsequently entered for the plaintiff.
The practitioner did not realise that section 5 of the Act required an application for leave to defend a claim on a dishonoured cheque to be made within 16 days of service or 21 days of service depending on the defendant’s place of residence. The practitioner incorrectly thought the limitation period was 30 days.
- Always double-check the relevant legislation to ascertain the applicable time limit. This is especially important when acting in matters outside your expertise.