Debt Recovery - Creditor’s Statutory Demand
In today’s uncertain economic environment, it may be useful for you to know that there may be relatively straight forward and inexpensive avenue open to you to recover debts owed by companies. That avenue is a Creditor’s Statutory Demand.
What is a Creditor’s Statutory Demand?
The Corporations Act 2001 (Cth) allows creditors who are owed more than $2,000 to deliver to a company what is known as, a Creditor’s Statutory Demand.
A Creditor’s Statutory Demand must be in the prescribed form (referred to as a Form 509H). The Form 509H is fairly simple to complete and must be accompanied by an Affidavit from or on behalf or the creditor verifying that the debt is due and owing.
A company who is served with a Creditor’s Statutory Demand has a period of 21 days to either:-
(a) pay the amount demanded; or
(b) bring an application in the Supreme Court to have the Creditor’s Statutory Demand set aside.
The 21-day period must be strictly complied with and cannot be extended even by a Court.
What happens if the company does not comply with the Creditor’s Statutory Demand?
