A 21-Day Legal Tool to Make Debtors Act
If your business is dealing with late-paying debtors, there’s a legal mechanism that can prompt action fast — and most people don’t realise they can use it. ⚡
In this short video, Joe from Millens explains a simple step that can give debtors just 21 days to respond… and why it’s so effective. ⏳
If you’re struggling with getting debtors to pay or know somebody else in this situation please get in touch or share this with them. 📩
VIDEO TRANSCRIPT
Joe Sweeney:
Hi. This short video is about what you can do if your business is struggling to get its debtors to pay on time. You may be interested to know that the law has this mechanism called a creditor's statutory demand. And a creditor's statutory demand is much like a letter of demand, except that the law behind it says that when a creditor's statutory demand is issued to the debtor, they have 21 days to pay the debt. And if they don't pay the debt, they are presumed under the law to be insolvent.
And then the law also says you are within your right then, as the creditor, to apply to the court to wind up the debtor company. Now, as you can imagine, debtors that are running a business happily, that is trading well and simply not paying you on time for their own purposes, do not want to be presumed insolvent, they want to continue trading so it's in their interests to respond to the creditor's statutory demand that you issue by paying the debt quickly.
And in our experience at Millens, the creditor's statutory demand does tend to have that effect in most cases. Now we can help you with this process of preparing a creditor's statutory demand. It's a simple, usually two page document accompanied by an affidavit that we would get you to sign that confirms that the debt exists and is due and payable. And the other requirement in order to exercise this process is that the debt must be over $4,000.
So if this is sounding like something that is relevant to your present situation, relevant to your business, we would be glad to chat to you about the process and glad to help you. I'm Joe from Millens, and we are here to help.