What does a statutory demand do?

A statutory demand is the first step in the insolvency process whereby a Creditor (person who says they are entitled to payment of monies) to initiate either bankruptcy or winding-up proceedings against a debtor. A recipient of a statutory demand has 18 days to either secure the creditors agreement not to rely on the demand, apply to the court to have the statutory demand set aside (if an individual) or apply to the court for an injunction preventing a winding up petition being issued (if a company recipient).