How to avoid a statutory demand?

Statutory demands are used by creditors as a debt recovery or credit control function. Sometimes statutory demands can be used inappropriately by a creditor who may suggest that a debt is due and owing without taking into account that the debtor disputes that the monies are owed. The easiest way to avoid a statutory demand is to discuss the position with creditors, including in writing, in order to try to avoid a statutory demand ever being issued. If a demand is issued then there are very specific steps that must be taken to avoid a bankruptcy petition being issued (in the case of an individual) or a winding up petition being issued (in the case of a company).