What is a Statutory Demand?

Statutory demands are legal documents issued to a person or company. They require payment of a debt within 21 days. It is a form of debt recovery which is usually pursued if mediation or arbitration between the creditor and debtor is unsuccessful.

How do you serve a statutory demand?

A statutory demand is issued by completing a statutory demand form. It is then delivered to the person’s home address or the company’s registered address.

To issue a statutory demand, the debt must be undisputed and less than 6 years old. Anyone can serve one, but a solicitor can help with the process. This can reduce the risk of errors or delays in getting the debt paid off.

The creditor must take every reasonable step to bring the statutory demand to the attention of the debtor. It is strongly recommended to have it delivered by a Process Server. This is a professional who will ensure all the correct procedures are followed when serving the form.

Once it is issued, the debtor has 21 days to pay the creditor back. After 21 days, the creditor can take the issue to court. If the debtor is an individual and the debt is over £5,000, they can begin bankruptcy proceedings. If the debtor is a company and owes over £750, they can begin winding up proceedings.

How much does it cost to serve a statutory demand?

There are no required fees to serve a statutory demand. However, there will be legal costs when working with a solicitor and/or a process server. If the matter needs to be escalated to bankruptcy or winding up, this will require paying a court fee.

In some cases, the debtor may need to pay the creditor’s legal fees for filing a statutory demand.

To learn more about how the DFA Law team can help you, give us a call on 01604 609560 or email info@dfalaw.co.uk.