A statutory demand is a way of recovering money that is owed to you. It is a written request for payment, either to a business or an individual and should include:
- The amount to be paid
- When payment must be made
- Contact details about the demand
- The outcome if the demand is ignored – ie court action to recover the debt
- Their right of dispute
Legal advice should be sought about statutory demands and when they are suitable to be used. If a debt has been owing for over six years or you have a court order for payment of the debt, they may not be used.
The demand must be ‘served’ on the debtor and proof kept that this was done as this will be needed if further action is taken to recover the debt. If you receive a statutory demand you have twenty one days to do one of the following:
- Settle the debt – ie pay it in full
- Secure the debt – ie make an agreement to pay later or in instalments
- Set aside the demand – ie challenge the demand in court
If the debt is not settled or challenged by the court the creditor can apply to the court to issue a bankruptcy or winding-up order against you.
Contact us on 01202 499255 if you have any questions about recovering debts – we can arrange a free appointment to discuss your situation.
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