Statutory demands

Duncan Lewis Litigation Solicitors – Statutory demands


A statutory demand is a request for payment where a debt is undisputed. A statutory demand can be used both for individual debtors and companies which owe money – and the demand is a legal process which allows the debtor 18 days in which to dispute the debt or reach agreement, or 21 days in which to pay.


A debtor may contact a creditor once it has received a statutory demand – and so it can be an effective way of opening up dialogue to recover monies owed.


Once the statutory demand has been issued, the debtor may also negotiate settlement of the debt with a creditor – eg by paying in instalments or offering a full and final settlement, which may be lower than the outstanding debt, but which guarantees that some of the monies will be repaid without recourse to further time consuming or costly legal procedures.


It is possible to send a statutory demand to a debtor without legal advice – but in cases where a debtor has persistently failed to pay the monies, or where a large sum of money is owed, or the debtor has failed to respond, taking legal advice and seeking the help of a specialist debt recovery solicitor like Duncan Lewis can bring about effective resolution of the matter.


Duncan Lewis civil litigation solicitors have extensive experience in debt recovery strategies – and can advise on every stage of the law in recovery of debt or claims, including where the creditor has a county court judgment against a debtor.


In the case of statutory demands, it is necessary to serve the demand within four months of the unpaid debt – in cases where a creditor wishes to serve a statutory demand outside the four-month limitation period, the court will assess whether the reason for doing so is valid.


Because of the limitation period for serving statutory demands on a debtor, Duncan Lewis advises creditors to seek expert legal advice on debt recovery solutions earlier rather than later – there may also be more cost effective ways of recovering a debt, which the Duncan Lewis debt recovery department can advise on.


For a debtor, the implications of a statutory demand can be serious if they do not respond, or are unable to repay the debt and/or decline to reach agreement.


If the debt is more than £5,000, it is possible for the creditor to seek a bankruptcy order against the debtor in cases where the debtor is an individual. 


A statutory demand can be sent to a company if the debt is more than £750 –
if the company does not pay the debt, the creditor can apply to the court for a winding up petition under the Insolvency Act 1986.


It is, however, not possible to send a statutory demand if the debt is more than six years old.


Duncan Lewis can also advise individuals and companies facing legal action over debt on defending winding up petitions or bankruptcy petitions.


For expert legal advice on debt recovery and Statutory Demands, call Duncan Lewis Civil Litigation Solicitors on 0333 772 0409.


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