Knowledge Hub | Articles

03 January 2014

Unpaid debt: Statutory demand or claim form?

If you are an individual or business faced with an unpaid invoice, you have a few options to consider. Assuming you have already attempted to contact the debtor to elicit payment, you need to decide whether to: issue court proceedings or threaten to instigate an insolvency process (if it appears that the debtor is unable to pay its debts).

This is a common dilemma faced by our clients and we are frequently called upon to advise upon the advantages and disadvantages of each option.

Option 1: Issuing a claim

Option 2: Insolvency proceedings


When seeking to recover a debt, there is an assortment of factors to consider before deciding on the best course of action to take and therefore you should assess the recovery of each debt on its individual merits.

In most circumstances, the court process and insolvency routes should only be considered after negotiation with the debtor has been attempted and failed. Litigation is expensive and the costs can be disproportionate to the sums in issue. In order to consider your options and ensure that if you do decide to issue proceedings or go down the insolvency route, the right procedures are abided by, you should contact an experienced solicitor in this area of law.

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Phone: +44 (0) 1753 889995


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