Claims Disputes

CLAIMS DISPUTES

Claims law governs the relationship between a debtor and a creditor. A debtor is someone who owes a debt to someone else, while a creditor is the person to whom the debtor owes a debt. A claim typically arises from contractual relationships, such as when a debtor borrows money from a creditor or when goods or services are to be provided in exchange for payment. Claims may also arise from price reductions, contract rescissions, or when a party is entitled to damages from the other party. This area of law covers not only the formation of claims but also their assignment, limitation periods, and enforcement.

A dispute in a debt claim arises when there is disagreement between the creditor and the debtor concerning the existence, amount, or validity of the claim. Such disputes may occur if the debtor denies the existence of the debt, disputes the amount owed, or claims that the debt has already been paid. Additionally, disagreements may arise regarding the terms of payment, including the timing and method of payment.

There is no overarching legal provision that specifies when a claim arises; this determination depends on the specific circumstances of each case.

Transfer of a claim

A monetary claim may be freely transferred to another party, allowing Creditor A to transfer their claim against Debtor B to a new Creditor C. The debtor’s consent is not required for the transfer of the claim; however, the debtor must be notified of the change in creditor to ensure that payment is made with a discharging effect.

Enforcement of a claim

If the creditor does not receive the payment to which they believe they are entitled, they may seek recourse through the Enforcement Authority (Kronofogdemyndigheten) by applying for a payment order. This administrative process involves the Enforcement Authority determining whether a valid basis for the claim exists, and if so, issuing an order for the debtor to pay. Should the debtor contest the payment order, the matter will be escalated to the district court for resolution.

Extinction of a claim

A debt can be extinguished in several ways, including 1) payment with discharging effect, 2) by the statute of limitations, 3) by set-off, 4) by waiver, or 5) through novation.

A debt can be extinguished in several ways, including:

1. Payment with discharging effect. The most common method, where the debtor fulfills their payment obligation, thereby releasing themselves from the debt.
2. Statute of limitations. If the creditor does not initiate legal action to claim payment within a specified period, the right to receive payment may lapse. The limitation period varies depending on the type of debt; typically, claims between private individuals have a ten-year limitation period, while claims between consumers and businesses have a three-year limitation period.
3. Set-off. This occurs when the debtor is also a creditor. Two parties with mutual debts may agree to offset their respective claims, leaving only the net balance to be paid. For set-off to be valid, the claims must be valid, commensurable, due, between the same parties, and the nature of the principal claim must permit set-off.
4. A creditor may voluntarily relinquish their right to payment by informing the debtor that they are no longer required to pay. This can occur for various reasons, such as goodwill or to avoid enforcement costs.
5. This involves replacing an existing debt with a new one, either by the parties agreeing to new terms or by a new debtor or creditor assuming the original claim. This results in the extinguishment of the old debt and the creation of a new obligation, which can be advantageous in adjusting the debt relationship to new circumstances.

We can help you

Those planning to borrow money as a debtor or lend money as a creditor should draft a promissory note to prevent future disputes. Please contact us for assistance in this process. We also provide support to individuals involved in debt disputes, whether in contesting liability or in pursuing the collection of payment.