Using a statutory demand as part of the enforcement process can be very powerful. But care is needed, especially with all the legal changes due to the Covid pandemic. Let our team provide you with the specialist advice you need.
Using a statutory demand properly can really help
Statutory demand enforcement is often a precursor to the threat of a winding up petition against a company or a bankruptcy petition against an individual. It can be a very powerful tool to recover outstanding debts from individuals or companies.
If you already have a court judgment
Where a creditor already has a court judgment, using the statutory demand procedure to serve a statutory demand judgment debt is an effective way of recovering a debt. It is risk free as the debtor cannot dispute the statutory demand in any way as it is based on a formal court judgment.
Enforcement if there is no court judgment – be careful
If a creditor is simply chasing an overdue debt using a statutory demand, he/she has to be very sure the debt is
- not subject to a genuine or substantial dispute; or
- the debtor does not have a legitimate cross claim or counterclaim against the creditor.
Whilst statutory demands can be very useful as part of enforcement process, they need to be handled with care. If a statutory demand is used where the debt is disputed, the creditor may potentially end up with a large costs order to pay if it
- loses an application to set aside the statutory demand by the debtor (if dealing with an individual statutory demand);
- loses an injunction application if it is a company statutory demand.
At Francis Wilks & Jones we can help advise as to whether your case is suitable for statutory demand enforcement or whether it is likely that the debtor will dispute the statutory demand which could in turn lead to difficulties for you as part of statutory demand enforcement. Call us today.