Your Company Has Been Sued for Breach of Contract: What to Do in the First 14 Days

Do not ignore it, and do not reply substantively before taking advice. Once a writ is served, you generally have 14 days to enter an appearance under Order 12 rule 4 of the Rules of Court 2012, and the defence itself falls due within 14 days after the later of that deadline or service of the statement of claim, under Order 18 rule 2. Miss the first step and the plaintiff can enter judgment against you without any of the merits being heard.

This guide covers what those deadlines actually are, what to do in the first fortnight, and the decisions that have to be made early because they cannot be made later.

The fortnight that shapes everything

A writ arrives at the registered office. It may sit in a mailbox nobody checks daily, or reach an administrator who does not recognise what it is. By the time it reaches someone senior, several days of a short window are gone.

Nothing about the first two weeks is about winning. It is about preserving your position: meeting the deadline, protecting evidence, and not saying anything that narrows your options.

What are the actual deadlines?

Two points that catch people out. The defence deadline runs from the later of two dates, not from service of the writ, so it is not simply "28 days". And these are the default positions: the court can extend time, and parties sometimes agree extensions, but neither is something to assume.

The first 14 days, in order

1. Establish the date and manner of service. Everything runs from it. Record when the document arrived, at which address, and how. If service was defective, that matters, but it is a point to take advice on, not to act on by ignoring the document.

2. Read what has actually been claimed. The statement of claim identifies the contract, the alleged breach, and the relief sought. The sum claimed is the plaintiff's case, not a settled figure.

3. Instruct solicitors immediately. The appearance is a procedural step, not an admission, and entering it preserves your right to defend. Leaving it is the single most expensive thing you can do in the first fortnight.

4. Stop the deletion. Issue a document preservation instruction across the business, covering email, messaging platforms, project files and accounting records. Routine auto-deletion continuing after you know of a claim is a problem you create for yourself.

5. Find your copy of the contract, and every variation. Including the ones agreed by email and never formalised. Your defence often lives in what was varied rather than what was originally signed.

6. Identify who knows. The people who ran the relationship may have left. Statements are easier to take while memories are fresh and while people still feel some loyalty.

7. Do not respond substantively to the other side. Not to their solicitors, not to their commercial team. Anything said can be put to your witnesses later. Communications genuinely aimed at settlement can be conducted on a without prejudice basis, but that is a decision to take with advice, not a label to apply casually.

8. Assess whether you have a claim of your own. This has to be raised with the defence, not later. See should you counterclaim.

9. Tell your insurer, if there is any prospect of cover. Policies commonly require prompt notification, and late notice can prejudice cover.

10. Decide who owns this internally. One person, senior enough to make decisions and available for the duration.

What if the deadline has already passed?

It is not necessarily over. The court may set aside or vary a judgment entered in default of appearance under Order 13 rule 8, and a judgment entered in default of pleadings under Order 19 rule 9, in each case on such terms as it thinks just.

But this is materially harder and more expensive than defending on time. You will need to explain the delay and show that there is a defence worth trying, and terms may be imposed. Treat it as a rescue, not an alternative route. What follows if nothing is done is covered in default judgment consequences.

What not to do

• Do not ignore it because the claim seems baseless. Merit is irrelevant to a default judgment.

• Do not call your counterpart to sort it out without advice. Admissions made in good faith are still admissions.

• Do not amend or tidy records. It converts a contract dispute into a credibility problem.

• Do not assume service was invalid and let the clock run. Take the point properly through solicitors.

• Do not delegate it to whoever has capacity. This needs the person who knows the relationship.

What the first fortnight costs if handled badly

A missed appearance can produce judgment for the full sum claimed plus costs, with no examination of whether the contract was breached at all. Setting that aside is possible but adds a contested application, delay, and cost, before the actual dispute has been touched.

The quieter failure is evidential. Documents lost to routine deletion, an unguarded email to the other side, or witnesses who have moved on all narrow a defence permanently. None of it shows up for months, and none of it can be undone.

Frequently Asked Questions

How long do I have to respond to a lawsuit in Malaysia?

Generally 14 days after service of the writ to enter an appearance, under Order 12 rule 4 of the Rules of Court 2012. For certain Sabah and Sarawak defendants it is 20 days. The defence follows, due within 14 days after the later of the appearance deadline or service of the statement of claim.

What happens if I do not respond?

The plaintiff can enter judgment in default without the merits being heard. That judgment is enforceable like any other.

Can a default judgment be set aside?

Sometimes. Order 13 rule 8 and Order 19 rule 9 allow the court to set aside or vary a default judgment on such terms as it thinks just. It is harder and more expensive than defending on time.

Should I contact the other side directly?

Not substantively, and not before taking advice. Statements made in commercial correspondence can be used in the proceedings.

Can we counterclaim against the party suing us?

If their conduct gives you a claim, yes, but it is added to your defence under Order 15 rule 2, so it has to be identified before the defence is served.

Does entering an appearance mean we admit the claim?

No. It is a procedural step that preserves your right to defend and does not concede anything.

The claim was sent to our old registered office. Does that help?

Possibly, but do not rely on it and do nothing. Service issues are taken through solicitors, promptly. Keeping the registered office current is exactly why it matters.

Getting the first fortnight right

The first two weeks decide what defence is still available to you months later: whether the deadline is met, whether the evidence survives, and whether a counterclaim is on the table. Legal That Works acts for businesses defending contract claims. See our civil litigation defence for breach of contract service. If a writ has been served on your company, that clock is already running.

This article is for general information only and does not constitute legal advice. Every transaction and every set of facts is different. Obtain specific advice from a qualified adviser before acting on any part of it.

Related guides

• What happens if you ignore a lawsuit

• Should you counterclaim?

• How a claim moves through the High Court

• Breach of contract in Malaysia