A Simple Technique for Getting a Company to Pay What It Owes You

by Matthew Elvin

If a company owes you money, there is one particularly simple and effective technique to recover that money quickly and cheaply. You can even do it without a lawyer. It’s called a Statutory Demand for Payment of a Debt.

You can download a copy of a blank Statutory Demand for Payment of a Debt document on the internet. You then complete it along with an accompanying Affidavit, and then post it all to the registered office of the company.

If the company’s debt to you is real, the company will probably pay up within 21 days. If the company doesn’t pay you within 21 days from receiving it in the post, then you are in a position where you can legally cause the company to be wound up (liquidated). This puts a lot of pressure on the company to pay you.

However, there are a few things to be aware of. Firstly, the money the company owes you must be a ‘genuine’ debt. So, if there is a genuine disagreement between you and the company about whether the money is owed to you, then you should not issue a statutory demand. If you do, the company can ask the court to set aside your statutory demand. If a court sets it aside, you may be ordered to pay the company’s legal costs. Secondly, the genuine debt must be more than $2,000.

Finally, although this is a simple and effective debt recovery technique, it is just as important as any other legal document that it is done correctly. If you make a mistake on the paperwork, you may run into serious trouble if it goes to court later on. There have been many cases where a debt was genuine, but a mistake on the original paperwork meant that the court proceeding against the company failed. For this reason, we suggest that you run your Statutory Demand past a lawyer before posting it to the company.

If a company owes you money, contact us for confidential, professional and obligation free legal advice.

Contact us to arrange a chat with one of our legal professionals. It doesn’t hurt to ask.