STATUTORY DEMANDS - is there anything we can do ?

[Curlyben]

Unfortunately that is exactly how they are used.
I recently had a long chat with TS concerning this same issue in regards RED debt.
Bear in mind that, something like, 70% of SD's are never followed through, but are simply filed as a clear threat.

To have them progress to full BK there are alot of hoops the creditor must jump through, all the t's must be crossed and the i's dotted.
They must PROVE service, either in person or by post, hence the main reason the threat SD's tend to be sent via standard SECOND class post, often from a bulk mailer.
Also ALL other creditors must be advised of the pending BK action, as they, may have larger balances than the DCA bringing the action and they can put a stop to the action.

The whole insolvency law in this regard is extremely archaic and needs a serious re-evaluation.

Here's some light reading on the subject:Legal Issues Explained - Statutory Demand

[Amethyst]

Re: STATUTORY DEMANDS - is there anything we can do ?

Thanks Curly. I'll have a good read through.

What did TS have to say on the issue ?

[Curlyben]

Re: STATUTORY DEMANDS - is there anything we can do ?

TS comfirmed that SD's are normally used as a serious threat and that the vast bulk are never followed through, for what ever reason.
RED tried to SD a whole bunch of barred B'card accounts that were under 2k average about 1,500.
So they ended up getting hit with a boat load of set asides and a TS review of their whole SD procedure.
These were all sent second class from bulk mailer UK mail, so no proof of service at all.

Service is meant to be in person, but substantiated postal service is allowable.

[Amethyst]

Re: STATUTORY DEMANDS - is there anything we can do ?

I read up a fair bit about it when Sapphy received her go-debt one.

So TS are well aware of the practise of using stat demands purely as a debt collection intimidatory measure - and them being used as a mid as opposed to a last resort. but will only act when a company really really messes up using it. wonder if we can get any proper stats for stat demands issues vs leading to actual bankruptcy.

The DCAs may end up having to pay set aside costs etc but it doesn't help the people who receive the demands, IMO unjustifiably and the set aside rate would kind of confirm that, the stress is immense. There are methods of collecting on debts which don't resort to bankruptcy for a couple of grand where a court would order installments and maybe charging orders. And certainly they shouldnt be able to chuck a stat demand in mid way through court proceedings cause it looks like they may lose. Once a stat demand is in they have you over a barrell basically - to the layman its just pay this or we take ur house.

Anyway you know all that. Just thinking.

[TUTTSI]

Re: STATUTORY DEMANDS - is there anything we can do ?

Some time ago my o/h received a stat demand. Financially at that time he could not pay the whole debt - but in this instance he did owe the money and just needed time.

Yes it was frightening, scarry and panic set in..... then he checked it out -

It turned out that the person who issued it, did not issue it correctly and had issued it from a county court, which he latter found out that the particular court does not deal with stat demands, therefore it rendered the stat demand void.

He also immediately paid an amount to get it under the £750 threshold and this also stopped proceedings as when this was discovered they could of re-issued to the correct court.

What does seem to be a worry is that debt collectors can suddenly out of the blue - like Go Debt and send a stat demand before you can even assertain if you actually owe the money and if they are legally entitled to it.


The serving of the stat demand has to be 100% correct for it to be legal and it is worth checking the status of the stat demand to ensure that it has been served correctly.

[Amethyst]

Re: STATUTORY DEMANDS - is there anything we can do ?

Hansard - 30th April

Treasury

Bankruptcy

Mr. Drew: To ask the Chancellor of the Exchequer if he will re-evaluate what the appropriateness of the length of the time that statutory demands normal term is before an action for bankruptcy is pursued. [202426]
Mr. McFadden: I have been asked to reply.
The ability to ask the court to make a bankruptcy order on the basis of the failure to comply with a statutory demand within the required period has been a feature of insolvency legislation for over 20 years.
The Insolvency Service has recently been conducting a review of its secondary legislation. In that process, it has consulted a wide-ranging group of stakeholders on proposed changes, sought views generally and has received no representations on this subject. We see no reason for any change
-------------------------- merged -----------------------------
Modernisation & Consolidation of Secondary Insolvency Legislation - Update February 2008
Revised Timetable for Commencement of the new Insolvency Rules

1. For the reasons set out below it has become necessary to put the timetable for commencement of the new Insolvency Rules (and the other instruments that fall within the scope of the project) back by a year, until 1 October 2009.

Consultation with Stakeholders

2. In December 2007 the Insolvency Service’s public consultation in relation to a proposed Legislative Reform Order (LRO) was completed. The proposals therein have largely arisen as a result of work that has been undertaken within the Modernisation and Consolidation project and set out our proposals to make various changes to the Insolvency Act 1986 and the Company Directors Disqualification Act 1986 (CDDA). We are now in the process of reviewing responses received in relation to each individual LRO proposal to determine which proposals may be put before Parliamentary Scrutiny Committees later in 2008. Any changes made to this primary legislation would need to come into force at the same time as the new Insolvency Rules if we are to maximise the benefits that the Insolvency Rules will make possible.
3. Work on the preparation of the new Insolvency Rules has progressed. Drafts of the new rules were delivered to The Insolvency Rules Committee (IRC) in December 2007. The new Rules are sizeable, include revisions to the structure and contain numerous detailed changes to the existing provisions to address many practical issues that have been raised by the insolvency profession and other users of the legislation. The work the IRC need to undertake represents a substantial undertaking and we now anticipate that they shall not have completed that work until late 2008.
Insolvency Statutory Forms
4. We have also been working with lawyers to make revisions to the 260-odd insolvency forms that are prescribed by the Insolvency Rules. We have liaised closely with Companies House regarding the implementation of relevant Companies Act 2006 provisions and other system changes required to accommodate the delivery of over 60 insolvency forms to the Registrar of Companies. In November 2007 Companies House announced that implementation of relevant Companies Act provisions was being put back from October 2008 to October 2009 and they now advise that system changes required for receipt of our new insolvency forms will also take place within that extended timeframe.

Other Instruments

5. In the coming months we shall be carrying out a targeted consultation in relation to revised drafts of both the Insolvent Partnerships Order and the Administration of Insolvent Estates of Deceased Persons Order. We shall also proceed with the preparation of the new Company Directors Disqualification Rules, the Insolvency Regulations, the Insolvency Proceedings (Monetary Limits) Order/ Regulations and the Companies (Disqualification Orders) Regulations. To assist users of the legislation we are planning to make available on The Insolvency Service’s website copies of the new Insolvency Rules and all the other new statutory instruments well in advance of the revised commencement date of 1 October 2009.

Any enquiries regarding the above should be directed towards Neil Ogilvie, Policy Unit, Area 5.7, 21 Bloomsbury Street, London WC1B 3QW; e-mail Neil.Ogilvie@insolvency.gsi.gov.uk




just for further thougts


In 2009, 1st credit were censured by the OFT
http://www.oft.gov.uk/news-and-updates/press/2009/20-09

In my opinion, this needs to be stopped.

Can I ask that anyone who has received a Statutory Demand whether recently or in the past; whether it is ongoing or you have had it set aside to place a link within this thread.
Could you also mention whether you have complained to the OFT or not.



From the OFT:
'Debt collection firms have a clear legal obligation to deal fairly and proportionately with consumers. This is more important than ever given the current economic climate, when people may already be suffering as a consequence of debt problems. We will continue to use our licensing powers to take firm action to protect consumers where debt collection engage in oppressive behaviour or practices that fail to comply with our guidance.'

Printed below is a letter you could adapt to your own situation when complaining to the OFT

YOUR NAME AND ADDRESS.

FAO Ray Watson

Dear Sir

I wish to make a formal complaint about a company called xxxxxxxxxxxx (Lowell etc) I have recently received a statutory demand which I intend to set aside due to a major dispute / which I have set aside in my local court, and despite (no response from xxxxxxx / them not appearing in court) / to which I have not responded, and it is clear to see that as the time has run out to present a bankruptcy petition / It should be mentioned that at no time have they attempted any kind of personal service which I believe is an integral part of the Insolvency procedures. I feel they have used the demand as a debt collection tool.

I understand that another debt collection agency were given 'requirements' by the Office Of Fair Trading back in 2009. In your requirements imposition you clearly stated to 1st Credit that.

refrain from issuing statutory demands warning of bankruptcy where it is unlikely that proceedings will be initiated

Can you please clarify to me if I am correct in stating that all debt collection agencies compliance departments should comply with this ?

I realise that you will not be able to get involved in individual cases, but I would like to bring this to your attention.

Yours sincerely

[Amethyst]

Re: STATUTORY DEMANDS - is there anything we can do ?

8. Proposal 5
To remove the requirement for any document in insolvency proceedings to be sworn by affidavits and to replace it with a less burdensome requirement for such documents to be verified by a statement of truth in accordance with the Civil Procedure Rules 1998.


This is the document Mr McFadden refers to. Theres no specific mention of ''length of the time that statutory demands normal term is before an action for bankruptcy is pursued'' lol.

Anyway just found it an interesting read saddo as I am Plus it does show that parts relating to the issues are currently matter for debate so there may be an opening for some kind of legaslative reform in this area too.

[Amethyst]

Re: STATUTORY DEMANDS - is there anything we can do ?

http://www.legalbeagles.info/forums/...d=1#post417776