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ARTICLE · 05 OCTOBER 2018

Five things a company needs to know about statutory demands

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If a statutory demand is ignored, the company is deemed to have committed an act of insolvency and may be wound up.

AustraliaInsolvency/Bankruptcy/Re-Structuring
Catherine Ballantyne
Catherine Ballantyne

Statutory demands are important documents that should never be ignored. Special Counsel Catherine Ballantyne outlines what companies need to know in order to act.

Statutory demands are often used to recover debts however they need to be used carefully in order to be valid.

Companies who receive a statutory demand need to act quickly in order to avoid being wound up.

  1. What is a statutory demand?

It is a notice to a company to pay a debt within 21 days of being served.

  1. What happens if you do not comply with a statutory demand?

If the statutory demand is ignored, the company is deemed to have committed an act of insolvency and may be wound up. This is unless one of the following occurs within 21 days of service of the statutory demand:

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Madgwicks is a member of Meritas, one of the world's largest law firm alliances.

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