Act fast if you receive a Statutory Demand…

A Statutory Demand is a formal demand made by a creditor on a company to require full payment of an undisputed debt within 15 working days. If the terms on the Demand are not complied with in the timeframe then the presumption is that there is no dispute regarding the debt owed.

When you receive a Statutory Demand, there are a few different options that are available to you. However, it is crucial that you act quickly. 

If you do not intend disputing the debt amount as stated in the Statutory Demand, then it is in your best interest to make full payment within 15 working days.

If you do not dispute the debt as stated in the Statutory Demand, but do not have the funds to make full payment, then you should try to arrange a payment plan with the creditor as soon as possible. 

With the creditor’s acceptance, you may be able to offer security over the company property which secures the payment of the debt. This must be done within the 15 day time frame of the Statutory Demand being served on you. 

However, although you have 15 working days to arrange this security, you only have 10 working days to apply to the Court to set aside the Statutory Demand.

If you are disputing the debt, then you must apply to the High Court within 10 working days of the Statutory Demand being served on you to have it be set aside. You will need to show the Court a genuine dispute over the debt claimed. 

If only part of the debt is disputed you will need to pay the undisputed amount within the 15 working days and make an application to the Court to set aside the Demand in relation to the disputed amount (within 10 working days).

Due to the tight timeframes (there are no extensions) that are triggered when a Statutory Demand is issued, you should get advice quickly from a professional experienced in the area.