Lawsuit

What it means

A lawsuit is a written filing by which the claimant starts court proceedings and asks the court to order the defendant to, for example, pay a debt, hand over an item, do something or refrain from doing something. It may also seek a declaration of whether a certain right or legal relationship exists.

A lawsuit must contain the statutory particulars: the court and the parties, a description of the relevant facts, the evidence and a precise statement of the relief sought. Errors in the claim may lead to a request for correction and, in the worst case, to its rejection.

For monetary claims, an application for a payment order is often the faster route. If the debtor files an objection, the case continues as ordinary proceedings. For cross-border claims within the EU, the European order for payment can also be used.

How it works in practice

Lawsuits are now generally filed electronically, and electronic communication with the court is mandatory for companies and lawyers. A court fee must be paid with the claim, its amount depending on the type and value of the claim, otherwise the court will discontinue the proceedings.

Before filing, it is wise to send the debtor a written demand, gather evidence such as contracts, invoices, correspondence and delivery notes, and check that the claim is not time-barred. In more complex cases it pays to consult an attorney.

If there is a risk that the debtor will move assets during the proceedings, an interim measure, such as a ban on disposing of assets, can be sought. Successful proceedings end with a judgment that is an enforcement title, allowing recovery through an enforcement officer.

What to watch out for

Court proceedings can take a long time and involve costs for the court fee, lawyers and possibly experts. An unsuccessful claimant usually pays the other side's costs. Before filing, it is therefore worth weighing the chances of success and whether the claim can actually be recovered.

Mediation or arbitration, if the parties have agreed to it, can be an alternative to court. In commercial contracts it is advisable to agree in advance on dispute resolution, the competent court and the governing law, which can make proceedings faster and cheaper.