What is a statutory demand?

General information from Lawmateanz

A statutory demand is a formal demand under the Companies Act 1993 for a company to pay a debt that's due and not genuinely disputed. It only applies to companies, not individuals.

The company has 15 working days to pay, settle the debt, or apply to the court to set the demand aside. If it doesn't, it's presumed unable to pay its debts, and the creditor can apply to put the company into liquidation.

A statutory demand shouldn't be used where the debt is genuinely disputed. Using it that way can lead to it being set aside, with costs awarded against you.

The demand must follow a set form and be served properly, so many creditors use a lawyer.

If you've received one, get advice quickly, because the 15 working days run fast.

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