Legal Project Management Plan & Checklist
Purpose of this Guide: Use this plan when your client's company has been served with a statutory demand and needs to respond urgently. The company has only 21 days from service to either pay the demand, reach a settlement with the creditor, or file an application in court to set the demand aside. Failing to act within 21 days creates a presumption of insolvency that can be used to wind up the company. Open this plan the same day the demand is received - time is critical.
Jurisdiction: Federal Court of Australia or Supreme Court of the relevant state (depending on where the company is incorporated or carries on business). The application to set aside must be filed within 21 days of service of the demand - there is no power to extend this time. Forks address the two main responses: applying to set aside the demand on the basis of a genuine dispute or offsetting claim, and transitioning to voluntary administration if the company genuinely cannot pay.
The Process at a Glance: Read the demand carefully and note the exact date of service - the 21-day countdown begins immediately. Review whether the underlying debt is genuinely disputed or whether the company has an offsetting claim against the creditor. If there is a genuine dispute or offsetting claim, prepare and file an application to set aside in the appropriate court within 21 days. If the debt is not disputed, assess whether the company can pay and, if not, whether voluntary administration or liquidation is appropriate. Negotiate with the creditor - many demands are resolved by a payment arrangement. If no application is filed and the demand is not complied with after 21 days, the company is deemed insolvent.
Use this fork when the company has been served with a statutory demand and there is a genuine dispute about whether the debt is owed, or the company has an offsetting claim against the creditor that equals or exceeds the amount of the demand. This fork covers the urgent court application that must be filed within 21 days of service.
Use this fork when the company has received a statutory demand and cannot pay its debts, but the directors believe the company is viable if given time to restructure. Voluntary administration provides a short breathing space from creditor action - typically 25 business days - during which an independent administrator assesses whether the company should execute a deed of company arrangement, be wound up, or be returned to the directors.
Key Legislation and Case Law: Corporations Act 2001 (Cth) s 459G (21-day filing deadline to set aside - cannot be extended: David Grant & Co v Westpac Banking Corporation (1995) 184 CLR 265), s 459H (genuine dispute or offsetting claim as grounds to set aside), s 459J (other grounds: defect causing substantial injustice, or other reason). The 21-day deadline is strictly enforced. A "genuine dispute" requires a real, honest question that is not merely fanciful: Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACSR 785.
* 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 Statutory Demand (Debtor) 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 Bankruptcy & Insolvency cases, outlining the standard RESTRUCTURING process. Utilize these tracking templates to manage your legal cases efficiently.
| Field | Token | Type | Required | Defined in |
|---|---|---|---|---|
| Matter(4) | ||||
| Matter numberⓘ | matter.matterNumber | text | Required | inheritedmatter-core |
| Matter title | matter.title | text | - | inheritedmatter-core |
| Matter typeⓘ | matter.matterType | text | - | inheritedmatter-core |
| Matter status | matter.status | text | - | inheritedmatter-core |
| Client(1) | ||||
| Client name | matter.clientName | text | Required | inheritedmatter-core |
Perform conflict checks, establish the strict 21-day deadline, and gather documents.
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Evaluate statutory defences including genuine dispute, offsetting claims, and formal defects.
Advise the board on legal options and potential personal liability (insolvent trading).
Commit to a pathway: negotiate, pay, apply to set aside, or enter administration.
Record the final resolution of the statutory demand and identify any residual obligations.