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ARTICLE · 24 DECEMBER 2014

Statutory demands and offsetting claims: is there a debt owing to the creditor?

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Debts claimed in statutory demands must be due and payable to the creditor named in the statutory demand.

AustraliaFinance and Banking
Graham Roberts
Graham Roberts
Sarah Lancaster
Sarah Lancaster
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Debts claimed in statutory demands must be due and payable to the creditor named in the statutory demand.

When disputing statutory demands it is common for debtor companies to argue an offsetting claim, so as to reduce or extinguish the amount claimed in the statutory demand.

For there to be a valid offsetting claim there must be 'mutuality', meaning that the legal capacities in which both the offsetting claim and the statutory demand debt are each claimed and owed must align.

In a recent Victorian case, In2Ply Pty Ltd v Amerind Pty Limited (in liq) (receivers and managers appointed) [2014] VSC 603, the receivers of Amerind (the purported creditor) issued a statutory demand on behalf of Amerind for payment of a post-receivership debt of $20,000 claimed to be owing to the company in receivership.

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