The Disputes Tribunal plays an important role as a less formal, less expensive, and faster alternative to the Courts for resolving small-scale disputes. Currently the jurisdiction of the Disputes Tribunal is limited to hearing claims of up to $15,000 in value, or $20,000 if both parties agree. A recent law change is set to increase the general threshold to claims of up to $30,000 in value, with no option to increase the threshold by agreement.
Doubling the jurisdiction of the Disputes Tribunal will make it a much more viable, attractive, and more commonly used option to resolve many disputes. It is, therefore, useful to be aware of the key advantages and disadvantages with bringing a claim in the Disputes Tribunal.
The costs associated with going through the Disputes Tribunal process are much less compared to taking a claim through the Courts, and still results in a binding and enforceable order. The parties are not allowed to have a lawyer represent them at the Disputes Tribunal hearing, reducing the overall legal fees incurred. Since lawyers are not allowed to appear, it is rare for the Disputes Tribunal to order that the unsuccessful party pay the other's costs, so an applicant can make a claim without there being much risk of the other party trying to seek legal costs if they fail. However, the Disputes Tribunal referee may award costs if a party makes a claim that is frivolous or vexatious. The filing fees for making an application in the Disputes Tribunal are also low.
In contrast to the courts and other forums, Disputes Tribunal hearings are private and neither the public nor the media are allowed to attend. Decisions of the Disputes Tribunal may be published, but the names of the people involved are kept confidential.
The Disputes Tribunal is more flexible than the Courts in terms of process and decisions the referee can make. The Disputes Tribunal determines disputes largely on fairness, and in doing so will have regard to the law but is not bound to give effect to strict legal rights or to legal technicalities. The referee may also encourage the parties to enter into a legally enforceable agreement rather than having the referee make a decision.
If the case in the Disputes Tribunal proceeds smoothly, a hearing can be set down and take place within one or two months of the claim being filed. This contrasts heavily with the Court system, which will often take over a year to go to trial.
Limitations and disadvantages
Limits on types of cases
There are limits on the types of disputes that can be heard by the Disputes Tribunal. For example, the Disputes Tribunal cannot deal with issues relating to tenancy, intellectual property, rates or taxes, welfare benefits, ACC payments, employment, wills, ownership of land, the care of children, or relationship property. Many of these types of issues have their own specific courts or tribunals.
The Disputes Tribunal won't deal with a claim concerning a debt or liquidated demand unless it involves a dispute between the parties. This means it cannot be used as a debt recovery tool in a situation where the person who owes money admits they owe the debt, but is refusing to pay. If you would like more information on debt recovery we have an article on it here.
The outcome of a case before the Disputes Tribunal is less predictable than with the formal Courts. As mentioned above, the Disputes Tribunal does not have to strictly follow the law or previous decisions made by the Disputes Tribunal, but rather must make decisions according to the substantial merits and justice of the case. This can make it harder to predict what the outcome of a particular case will be.
How we can help
We can help you take advantage of the increased jurisdiction of the Disputes Tribunal by:
- providing advice on how the law applies to your situation, and what your legal position is;
- providing advice on whether the Disputes Tribunal is the best forum for achieving your desired outcome, and what other options you may have;
- drafting your application and arguments for the Disputes Tribunal; and
- helping you prepare for the hearing.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.