At GTL we have often found that credit managers and professionals in the collections and debt recovery industries tend to go the easy route.
As such, they wrongly believe that issuing a Creditor’s Statutory Demand for payment is a relatively hands-free and cost effective way to apply pressure to a company to obtain payment.
However, there are major questions to ask and pitfalls to avoid:
1. Is the Statutory Demand based on a Default Judgment?
2. Has the debtor remained silent and therefore unable to display any signs of insolvency (other than non-payment of debt)?
3. Is the debt due and owing and pursuable?
4. Is the debt below the statutory threshold of $2,000?
5. Has the debtor disputed the debt or raised an offsetting claim?
6. Is the debtor registered in a different state to where you are issuing?
These are just a few of the points to consider when issuing a Creditors Statutory Demand for payment.
You can download our flowchart showing the Legal Process for Debt Recovery - https://bit.ly/38sD8Rl
And if you need help with any potential issues in issuing a Creditors Statutory Demand then give us a call - 02 9922 4111
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