What is a Statutory Demand?

Under Section 9 of the Corporations Law a Statutory Demand is defined as:

A document that is or purports to be a demand served under Section 459E of the  Corporations Law[1];

A Creditor may serve a statutory demand on a company:

If the demand relates to a single debt that is due and payable[2]; or if it relates to 2 or more debts that are due and payable[2]; and

Must require the company to pay the amount of the debt, or the total of the amounts of the debts,  to the creditor’s reasonable satisfaction within 21 days after the demand is served on the company; and

Must be in writing on the appropriate form and must be signed by or on behalf of the creditor.

Before making a Statutory demand you should obtain legal advice to ensure that you are entitled to make such a demand.

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If your company receives a Statutory Demand

You must within 21 days either:

Pay the debt; or

Apply to have the Statutory Demand set aside; or

For more information, please contact:

Matthew Bridger | e: mbridger@elringtons.com.au | p: 02 6206 1300 http://elringtons.com.au/wp-content/uploads/2011/07/Specialist-accreditaion.jpg

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[1]  CORPORATIONS ACT 2001 – SECT 459E

[2] The debt or total of the debts must total at least the statutory minimum (currently $2000)