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Bankruptcy - Statutory Demand

A look at statutory demands - requesting money off a debtor.

You can make a statutory demand to ask for payment for a debt owed to you from an individual or company. No legal representation is needed, and you can make this demand yourself.

When someone receives such a demand, they have 21 days to either settle the debt or reach an agreement with the creditor. If such an agreement is not met or debts paid off, then the person owed money can start bankruptcy proceedings if owed a sufficient amount or wind up a limited company.

Forms

Form 6.1 – for a specific amount payable now.
Form 6.2 – for a specific amount payable now following a judgment or a court order.
Form 6.3 – for debts payable in the future.
To serve a demand on a limited company, use statutory demand form 4.1.
In Scotland a different form is used.

Serving a statutory demand

Naturally the recipient of a statutory demand must be aware that they have received one. Thus it can be “served” in person, you can get a “process server” such as a solicitor to serve it on your behalf, or send it by secure post or through a letterbox. If the demand is ignored you must fill in a form stating that you served the demand properly.
(Form 6.11 if you or someone else served the demand in person, form 6.12 if it was served in another way (e.g. by post))

Challenging a statutory demand

If you don’t agree with a statutory demand, you can apply to a court to have it cancelled (or “set aside”). This must be done within 18 days in the UK from the date you received the demand, if you were in the UK at the time. You get 21 to 34 days if you were abroad at the time, depending on where you were. To get a demand cancelled, you need to fill in Form 6.4, and also 6.5, which is a statement of truth demand. The forms must then be presented at a court.
If the court agrees with your reasoning, they will arrange a hearing to discuss the matter. All payment deadlines will be suspended in the meantime.
If the court hearing is not successful, the time period for repaying the debt will restart.



Free debt counselling and advice is also available from the Money Advice Service available at: www.moneyadviceservice.org.uk

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