I received a Statutory Demand. What do I do?

A Statutory Demand (Form 509H) is the most powerful weapon a creditor has against a company. It is a formal demand for payment of a debt over $4,000 (currently).

The 21-Day Rule

Once served, you have 21 days to:

1. Pay the debt in full.
2. Secure or compound the debt (make a deal).
3. Apply to the Court to set it aside (e.g., if there is a “genuine dispute” about the debt).

If You Do Nothing

If the 21 days expire, your company is presumed insolvent under the Corporations Act 2001 (Cth).¹

• The creditor can file a winding-up application to appoint a liquidator.
• It is virtually impossible to argue about the debt after this point.

Setting it Aside

To set aside a demand, you must prove there is a genuine dispute about the existence or amount of the debt, or that you have an offsetting claim.

Related Topics

• Bankruptcy vs Liquidation
• Commercial Recovery
• Debt Practice Area

Urgent Action

If you have been served, email us immediately. Every hour counts.

Received a demand? Contact us urgently. Call (07) 5532 8777.