A statutory demand is a demand for payment of a debt whether it be owed by a company or an individual.
Failure to comply with a statutory demand may lead to the issue of bankruptcy proceedings against an individual, where the debt is at least £5,000 or a winding up petition against a company owing at least £750, should the creditor desire.
However, the mere issue of a statutory demand will very frequently achieve the desired effect given the severe consequences which may follow should it be ignored and a petition issued. The issue of a petition, and its advertisement in the London Gazette, may trigger circumstances that become difficult to control if other creditors have cause to be concerned about their relationship with the debtor.
Many commercial lending agreements contain provisions enabling a lender to immediately call in its own debt upon the issue of a petition.
The Latest Legislation | Kangs Advisory Solicitors
The Insolvency (England and Wales) (Amendment) Rules 2017 came into force on 6th April 2017.
The new rules replace the Insolvency Rules 1986 and are designed to reflect modern business practice and to make the insolvency process more efficient.
Options Upon Receipt Of A Statutory Demand | Kangs Insolvency Defence Solicitors
- The most important thing is not to ignore it, as doing so can lead to a chain of circumstances that is difficult to unravel.
- Get immediate advice from experts
- Do not delay; there are strict time limits on applications to set-aside.
Grounds For Setting Aside A Statutory Demand | Kangs Defence Solicitors
Reasons that will be considered by a court include:
- the debtor appears to have a counterclaim, set-off or cross demand which equals or exceeds the amount of the debt or debts specified in the statutory demand,
- the debt is disputed on genuine grounds,
- the Insolvency Rules have not been complied with such as service has not been effected correctly
Who Can I Contact For Assistance? | Kangs Insolvency Solicitors
Should you have any questions or need advice, please do not hesitate to contact our Team through one of our solicitors listed below: