A creditor can make a statutory demand to an individual or a company which owes them money.
After a statutory demand has been served, the debt must be paid within 21 days.
If the individual owes more than £5,000 or a limited company £750 or more and they do not pay the debt, a creditor can then take action to start bankruptcy proceedings against an individual debtor – or instigate winding up proceedings against a company which does not pay its debt.
Statutory demands have to be served on (delivered to) the debtor or a company official, such as a director or the company secretary.
When serving a statutory demand, there is a specific legal form to be completed, depending on whether the debtor is an individual or a limited company – and this form is served on the debtor. The creditor can serve the statutory demand form on the debtor or a solicitor can arrange to serve it.
A statutory demand has to be served within four months – debts more than six years old cannot be collected using a statutory demand.
Statutory demands can also be challenged by the debtor – and it may also be that negotiations between debtor and creditor might provide a debt arrangement without resorting to court action to recover monies owed.
Duncan Lewis debt management solicitors can advise on serving and challenging a statutory demand – as well as advising on options available if the debtor fails to make payment or the statutory demand has not been served within the law.
Duncan Lewis can also advise on cross-border debt matters – including how to serve a statutory demand in a jurisdiction outside England and Wales.
Clients who receive a statutory demand and are unable to pay the debt or wish to challenge the statutory demand are advised to contact Duncan Lewis debt management solicitors as soon as possible.
For expert legal advice on statutory demands and debt solutions, call Duncan Lewis Debt Management Solicitors on 0333 772 0409.