Statutory Demand

A statutory demand is a formal legal request made by a creditor to a debtor, typically used in cases where the debtor owes a significant amount of money. It requires the debtor to pay the debt within a specific timeframe, usually 21 days. If the debtor fails to respond or settle the debt, the creditor can initiate bankruptcy or winding-up proceedings. This tool is often used in business contexts to enforce payment and signal seriousness about recovering debts, but it must adhere to strict legal requirements to be valid.