Statutory demand eligibility checklist

In short

You can generally issue a statutory demand where: the debtor is a company; the debt is due and payable; it exceeds the statutory minimum ($4,000); it is not genuinely disputed and there is no offsetting claim; and, for a non-judgment debt, you can provide a supporting affidavit verifying the debt.

Work through this checklist before issuing a statutory demand. If you cannot tick every box, a statutory demand may not be the right tool.

Eligibility checklist

  • The debtor is a registered company.
  • The debt is due and payable (not future or contingent).
  • The amount exceeds the statutory minimum ($4,000).
  • The debt is not genuinely disputed.
  • The debtor has no offsetting claim against you.
  • For a non-judgment debt, you can provide a supporting affidavit (Form 509H).

If a box is unticked

A genuinely disputed debt, an amount below the threshold, or a missing affidavit can each be fatal to a statutory demand. In those cases consider a letter of demand or other recovery options instead.

Do not use a statutory demand for a genuinely disputed debt. If the debtor disputes the debt on genuine grounds, or has an offsetting claim, a statutory demand can be set aside and cost orders may follow. If in doubt, seek advice before proceeding.

References

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