Can a Statutory Demand be issued if the debt is disputed?

If you issue a demand without realising there is a dispute, or if the dispute comes to light later, then what happens depends on whether your debt is with a Limited Company or not. If it is, you will be expected to agree that you would not wind the company up without resolving the dispute. […]

If you issue a demand without realising there is a dispute, or if the dispute comes to light later, then what happens depends on whether your debt is with a Limited Company or not. If it is, you will be expected to agree that you would not wind the company up without resolving the dispute. If the debt is to an individual or a non-Limited Company, the debtor would be able to request a court hearing, where a Judge will decide whether it is a valid dispute.

In either case, you can always continue with County Court proceedings even if there is a valid dispute and even if the demand is not proceeded with.

If there is a genuine dispute, you should not issue a statutory demand until you have resolved the dispute with the debtor. Likewise, if you genuinely owe the debtor a sum equal to or greater than the amount, you cannot use this process.

Daniels Silverman can advise you as to whether the dispute is genuine. For example, if a debtor says “this is disputed, I’m not paying”, but then refuses to say what the dispute is, then clearly this nothing more than a stalling tactic – one which will quickly be brought to an end when the demand is handed to them. On the other hand, valid disputes do need to be resolved.

What happens if a debtor still refuses to pay?

If they do not pay because they refuse to pay, you can go forward to make them bankrupt / put them into liquidation. Very rapidly the Official Receiver will get involved and make refusing to pay not an option.

There are always cases where a company is so short of money, they cannot pay. If this is the case, at least by pushing things as far as you can, you will know you have done everything possible to get the money. It would be your decision then whether to take the final step of insolvency and recover what money you can.

How do I get my statutory demand issued?

CONTACT OUR CUSTOMER SERVICE TEAM STRAIGHT AWAY – the demand could be handed to your debtor in as little as three days later.