Once default Judgment is in place, and with no stay on Court proceedings a Statutory demand can be issued to continue the debt recovery process. (It should be noted that it is not essential to have a Judgment in place to issue a Statutory demand, but due to some recent court decisions we are of the opinion that it is prudent to have obtained Judgment - refer to Britten–Norman Pty Ltd v Analysis & Technology Australia Pty Ltd (2013) NSWCA 344). Please note this page is general information only and does not constitute legal advice. You should contact us to discuss your specific circumstances so we can help you effectively collect your debt.
The Judgment debt must be over $2,000 to issue a Statutory Demand and the Judgment Debt must be less than 6 years old. From our experience in collecting debts through this process, it is rare to explore this avenue for debts under $10,000. This is because of the cost involved in a Creditors Petition, which we will go through in a separate article.
The process of issuing a Statutory Demand is different to a bankruptcy notice. The notice is not requested by AFSA. We instruct our lawyers, Collection Law Partners to prepare and issue a statutory demand under section 459E of the Corporations Act. There are some very specific requirements to a Statutory Demand that must be met if action is to be taken upon the expiry of the Statutory Demand.
Included in the Statutory Demand are details of the debt, any interest that has accrued and an affidavit that there is no genuine dispute sworn by the creditor. The Statutory Demand allows for payment within 21 days of service or allows the debtor to dispute the debt. The Statutory Demand must be served on the registered office of the company.