Longridge: 01772 783 314 | Garstang: 01995 602 129 | Lancaster: 01524 581 306 
 
Longridge: 01772 783 314 
Garstang: 01995 602 129 
Lancaster: 01524 581 306 
There can’t be too many of us who haven’t had to chase for the £100.00 we lent a ‘friend’ for a night out. Obviously, the friendship soon ends and you realise (probably) that, to quote Polonius, it’s probably easier to avoid the wrath of your significant other, to follow the adage of ‘neither a borrower or lender be’. You live and learn. 
 
I mean, you’d never serve a friend with a Statutory Demand.. would you?  
 
Well, actually, no. At least not for a hundred quid. But what if they owed you in excess of £5,000.00- this being the threshold for which you can start serving your Statutory Demand against an individual. 
 
Tell us what a Statutory Demand is, then. 
Well, it’s a way of commencing bankruptcy proceedings against a person, or company, that owes you money. It’s the first step, anyway.  
 
A Statutory Demand, or ‘Stat Demand’ to use the common parlance, must be issued against the debtor within 6 years of the debt being owed, and be in a strict set format. If you are issuing against an individual, then there are three types of Statutory Demand. You need to choose the one most befitting of your needs, and complete and serve accordingly: your local solicitors will be able to help, for a fee, if you have any questions or queries about which ‘Demand’ would be most appropriate.  
 
Examples of the three types of Statutory Demand are attached here….. Which form you need depends on whether you’re collecting a debt that’s: 
 
 
When a debtor receives a Statutory Demand, it formalises matters. You’ve been chasing for months by text, or emailing, but the debtor has remained elusive, and you’re still £5,000.00 out of pocket.  
 
MG Legal, your Lancaster solicitors, take instruction from both parties on a regular basis (the debtor’s and the creditors), and always give thorough, easy to understand legal advice. If you are the creditor, and are owed in excess of £5,000.00, or more than £750.00 if the debtor is a company, then the Statutory Demand must contain the wording as per the attached – your nearest solicitors in Preston and solicitors in Lancaster, will advise you which of the three ‘Stat Demands’ you need), and the ‘Demand must be served upon the Debtor in one of the following ways: 
 
By handing it to the individual who owes you money (try all their known addresses) 
Leaving it at the registered office of the company or partnership that owes money (or the main place of business if they do not have a registered office) 
Giving it to the company’s director, company secretary, manager or principal officer 
Get a ‘process server’ to serve it for you ( your local solicitor can arrange this) 
You can only send it by registered post or put it through a letterbox if it cannot be delivered in person. 
 
If you are serving a Statutory Demand against a partnership, you would need to ensure that each of the partners are served. 
 
To serve on a company, then there is only one form that you can use, and that’s Form SD1.  
 
So, what are the effects of a Statutory Demand?  
 
Well, if the debtor is an individual, and doesn’t respond within 21 days, then things get serious, and you can apply to make them bankrupt. See our blog on bankruptcy and its’ effects here…. 
 
If the Stat’ Demand is served on a company, and the creditor receives no response, including an offer of payment, upon the expiry of the 21 days, then an application to wind up (close down), the company could be made at this juncture. Any application to bankrupt an individual, or indeed, wind up a company, must be made within 4 months from the date the response to the Statutory Demand is due. 
 
If you have been served with a Statutory Demand, then all is not lost. Be pragmatic: do you owe the money of not? Have you been served with a ‘Stat Demand’ capriciously by a creditor- let’s say, when the debt apparently owed is disputed, and well, probably should not have been served on you at all. If this is the case, go and see a local solicitor, specialising in such matters. Common sense should prevail, and if you believe that you do not owe the debt, then you can make an application to the court named on the ‘Demand’ served on you, using form IAA within 18 days, detailing the reasons you believe the debt not to be owed. 
 
If the ‘Demand' was served on a company, then the same cannot be challenged. In this instance, an application would be made to stop the creditor from winding up your company, instead. 
 
If you require any advice on Statutory Demands, or want to know more about the other ways of pursuing a debt owed, then please do not hesitate to get in touch. Our team of qualified solicitors in Lancaster, Preston and Longridge are on hand to help. 
 
MG Legal - Your Local Solicitors 
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