Legal Project Management Plan & Checklist
Purpose of this Guide: Use this plan when your client is owed money by a company that has not paid and you want to use a statutory demand as the first step in a winding up process. A statutory demand is a formal written demand that gives the company 21 days to pay the debt. If the company fails to comply and cannot demonstrate a genuine dispute, a court presumes it is insolvent - which is the gateway to obtaining a winding up order. Open this plan when the debt is at least $4,000 and there is no genuine dispute about whether it is owed. Verify current guidelines on the official Australia Government Portal. Access services via the Federal Register of Legislation.
Jurisdiction: Federal Court of Australia or Supreme Court of the relevant state for winding up proceedings. The statutory demand itself is a document served directly on the company - no court filing is required to issue it. Forks address the follow-on process once the company fails to comply: filing and prosecuting a winding up application in the Federal Court or Supreme Court.
Use this fork when the company failed to comply with the statutory demand within 21 days, no application to set it aside was filed, and you are now proceeding to file a winding up application in court. At this stage, the company is presumed insolvent and the creditor's task is to obtain a court order appointing a liquidator. Verify current guidelines on the official Australia Government Portal. Access services via the Federal Register of Legislation.
The Process at a Glance: Confirm the debt amount (minimum $4,000), that it is undisputed, and that no offsetting claim is expected. Prepare the statutory demand in the prescribed form (Form 509H) and have it served on the company at its registered office. The company has 21 days to comply. If it fails to pay or reach a settlement within 21 days, it is deemed insolvent. File a winding up application in the Federal Court or the relevant Supreme Court within 3 months of the expiry of the demand. Serve the application on the company and advertise it in the Australian Government Gazette. Attend the hearing and, if the court is satisfied, obtain a winding up order. Verify current guidelines on the official Australia Government Portal.
Key Legislation and Case Law: Corporations Act 2001 (Cth) s 459E (statutory demand requirements), s 459F (21-day compliance period), s 459G (application to set aside - company must file within 21 days), s 459P (winding up application), s 459R (3-month window to file winding up application after demand expires), s 459S (grounds for opposing). ASIC Form 509H is the prescribed form for a statutory demand. The debt threshold is $4,000: s 9 definition of "statutory minimum".
* Disclaimer: We're nobody's lawyer, because we aren't lawyers. You are, so you know better than to take legal advice from an app. We also aren't accountants or dog trainers - just digital spirit guides taking zero liability for any of this. This site exists to gather the collective knowledge of practitioners like you. Verify everything and submit your feedback on the Corporate Insolvency: Statutory Demand (Creditor) matter plan to improve the playbook. THIS IS NOT LEGAL ADVICE, it's a request for input.
This legal matter plan provides a structured workflow for COMMERCIAL_LAW cases, outlining the standard RESTRUCTURING process. Utilize these tracking templates to manage your legal cases efficiently.
Open file, complete compliance, and verify the minimum debt threshold.
Verify all prerequisite documentation has been obtained, cross-reference against the statutory requirements for this matter type, and confirm compliance with practice direction protocols.
Prepare the relevant forms and supporting materials required under the applicable legislation, ensuring all mandatory fields are completed and all attachments are properly certified.
s 459E(2) Corporations Act 2001 (Cth) - the statutory demand minimum threshold is $4,000 (previously $2,000, increased by Corporations Amendment (Insolvency) Regulations 2021).
If the debt is below this threshold, the demand is invalid and cannot ground a presumption of insolvency.
Draft Form 509H and, if necessary, the supporting affidavit verifying the debt.
Draft and dispatch formal correspondence addressing the procedural requirements at this stage, including any required notices, requests for information, or proposals for resolution.
Serve the demand at the registered office and secure an affidavit of service.
Conduct a thorough review of all filed materials to ensure compliance with court requirements, verify service obligations have been met, and prepare for the next procedural milestone.
s 459E Corporations Act 2001 (Cth) - prescribes the requirements for a valid statutory demand:
Defects in form may justify set-aside under s 459J if they cause 'substantial injustice' - Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd (1997) 76 FCR 452.
Coordinate the collection and review of all financial documentation required for disclosure, including statements, valuations, and supporting schedules as mandated by the rules.
s 459E(3) Corporations Act 2001 (Cth) - a statutory demand for a non-judgment debt must be accompanied by an affidavit that verifies the debt is due and payable. Failure to include the affidavit is a defect that may ground a set-aside application.
The affidavit must be by a person with direct knowledge of the debt - not merely on information and belief.
s 109X Corporations Act 2001 (Cth) - a document may be served on a company by:
The date of service is critical because the 21-day compliance period runs from service, not from drafting. Postal service may create ambiguity about the service date - personal service avoids this risk.
David Grant & Co Pty Ltd v Westpac Banking Corporation (1995) 184 CLR 265 - the 21-day period is strictly non-extendable.
Assess the strategic considerations for interim applications, prepare supporting evidence, and draft the necessary documentation for urgent or time-sensitive relief sought.