Statutory Demands
Why Seek Legal Advice?
What is a Statutory Demand?
A statutory demand is a formal, written demand for payment of a debt issued by a creditor to a company under the Corporations Act 2001 (Cth). If the company fails to comply within 21 days, it may be presumed insolvent and face winding up proceedings in court.
Why is Legal Advice Essential?
- Strict Timeframes: Statutory demands must be complied with or set aside within 21 days. Missing the deadline can have serious and irreversible consequences for a company.
- Potential for Insolvency Proceedings: Failure to respond allows the creditor to apply for a court order to wind up your company—potentially ending your business.
- Technical Defects: Statutory demands often contain technical errors. A lawyer can identify defects and help set aside invalid demands, protecting your rights.
- Avoiding Personal Liability: Directors may become personally liable if a company is wound up due to mishandling a statutory demand.
- Exploring All Options: Legal advice helps clarify whether to pay the debt, negotiate terms, or challenge the demand, and ensures you use the correct process.
How Our Gold Coast Legal Team Can Help
- Expert Review: We assess the demand, your company’s financial situation, and any grounds for setting aside the demand.
- Challenging Invalid Demands: If there are grounds—such as a genuine dispute or a technical defect—we can apply to the court to have the demand set aside.
- Clear Guidance: We advise you on the risks, possible defences, and the best strategies to protect your company and its directors.
- Negotiation & Settlement: Our team can negotiate with creditors or explore settlement options to resolve the matter efficiently.
- Urgent Action: We act quickly to protect your business, meeting all statutory deadlines and responding decisively.
Don’t Delay: Time is Critical
If your company receives a statutory demand, seek legal advice immediately. Early intervention maximises your options and can make the difference between business continuity and liquidation.
Contact our Gold Coast team today for confidential expert advice and fast, effective action.