Statutory Demand

A statutory demand is a very effective method of getting paid where the debtor is a company.

A statutory demand must be issued in the form prescribed under the Corporations Law and be supported by an affidavit in the correct form by the creditor or one of it directors.

The statutory demand gives the debtor company 21 days within which to pay or compromise the debt, and if it does not do so the company is presumed to be insolvent. This then allows the applicant to immediately apply to the Supreme Court for an order for the winding up of the company, which will be difficult to resist.

If your company has received a statutory demand contact us urgently. We only have 21 days within which to prepare an application to Court to set it aside. The Court rules and the forms are quite complex and procedures must be properly followed to be effective.

While a statutory demand is an effective debt collecting procedure, we urge great caution in using it for any debt where there is a genuine dispute. Such disputes will inevitably end up in the Supreme Court which is a very expensive jurisdiction if the amounts involved are relatively small.

Because of the dramatic effect of a statutory demand, there have been a great many court cases. At PM Lee & Co Property & Business Lawyers we are familiar with those cases and decisions and they provide us useful guidance in using this procedure, and helping you to avoid the pitfalls that await the unwary.

At PM Lee & Co Property & Business Lawyers we will help you use this effective business tool as part of your debt recovery armoury.

If you have received a statutory demand contact us urgently for assistance.

Please call Peter Lee or Graham Knight on 3186 6666 or email peter@plee.com.au if you have any enquiries.

< Back to insolvency and restructuring