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The action by stages was introduced into the Croatian civil procedure law by the 2003 Law on Amendments to the Civil Procedure Act, with the aim of increasing the general quality and ef)ficiency in providing legal protection and improving the general functioning of civil procedure. Courts do not keep records of the number of received actions by stages lawsuits but available case law indicates that difficulties do exist and thus the need for a serious approach to this issue. The aim of this paper is to point out the importance of understanding the legal institute of action by stages with an emphasis on its practical application. Participants in court proceedings who apply to the court by filing an action by stages must be aware of its legal effects at certain stages of civil proceedings. On the other hand, the court must also ensure the lawful application of this institute so as not to commit procedural violations that would jeopardize the litigants’ legal position. In this regard, the analysis of this legal institute is necessary in order to remove practical doubts and ensure its legal function. Research results of this paper have confirmed that practical doubts should not be neglected and that there is room to consider a more efficient solution than the one in existence. [ABSTRACT FROM AUTHOR]