Statutory Demand (Before BR)

rog2

Hi Charlotte - I've only just spotted this thread. I don't know if I am one of the best people to advise, but Fermi is quite correct in saying that I was made bankrupt as a result of a creditor's petition following the service of a Statutory Demand. In my case it was HMRC and the amount was far more than what Connaught are claiming that you owe.
First of all - Any creditor, to whom you owe more than £750.00, has the right to petition for your bankruptcy. Normally, they would go down the avenue of getting a CCJ before issuing you with a Statutory Demand, as this strengthens their case, although a CCJ is NOT a pre-requisite to the issue of a Statutory Demand.
A Statutory Demand is, normally, personally served - or served by registered/recorded delivery, although again recent posts appear to indicate that it is, apparently, okay to send these documents by first class post.
As Fermi has said, Statutory Demands are very serious documents, and should not be ignored. Basically an SD is legally required as a final opportunity for a debtor to either pay, or reach an agreement with, a creditor.
A Statutory Demand does not always mean impending bankruptcy, as I will try to explain later, but it does give the creditor the right to petition, to the courts, for the bankruptcy of the creditor.
IF the debtor fails to contact, pay, or reach an agreement with, the creditor during the 18 day period, or apply to the courts to have the SD 'set-aside' then the creditor has, basically, two choices - either to do nothing, or to petition for the debtor's bankruptcy.
If the creditor opts to go down the route of bankruptcy then he must pay all up-front fees (these fees are usually much more than in the case of 'debtor petitions' and are usually in the region of £1500). Whilst these 'fees' would be added to the debtor's 'estate in bankruptcy' the creditor has NO guarantee that he will recover the fee. Neither does the petitioning creditor gain any preferential status, by petitioning for a debtor's bankruptcy - his claim will be considered by the Official Recever in the same way as the debtor's other creditors.
Hence, very few creditors go down the route of petitioning for a debtor's bankruptcy without thoroughly having tried all other means of collecting the debt.
Unfortunately there appears, currently, to be a spate of Debt Collection Agencies issuing documents, which appear to be genuine Statutory Demands, as the wording and implication of impending bankruptcy is, often, enough to frighten debtors into submission.
From what you describe, this would appear to be what Connaught are trying to do with you.
I would take the document to CAB, if you want clarification as to whether it is genuine, or not, but, Personally, I would be inclined to 'call their bluff' on this one.