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Setting aside statutory demands

Setting aside statutory demands

If ignored, a statutory demand can be a death sentence for your company.

If you don’t pay the debt or apply to a court within 21 days, your company is presumed insolvent and may be liquidated. Act now! 

A creditor’s statutory demand for payment of a debt (Form 509H) is the corporate equivalent of a bankruptcy notice. It requires a company to pay a debt within 21 days or apply to a court to set the demand aside. A company that does neither will be presumed insolvent and the creditor will then be able to issue winding up proceedings.

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How we can help you

At an assessment we will give you advice on your prospects of having the demand set aside. If the matter cannot be resolved by negotiation, we offer fixed price court representation.

Assessment

$440 inc GST

If you dispute the debt or believe you have an offsetting claim against the creditor, we will review the situation and advise you of your chances of having the demand set aside.

We will provide you with a fixed price quote for a Negotiated settlement or Court hearing after we have considered the matter at an Assessment.

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Negotiated settlement

We will:

  • prepare an affidavit explaining why the demand should be set aside; and
  • before incurring court fees, send a copy to your creditor and invite them to withdraw the demand.

If your affidavit raises a genuine dispute, a sensible creditor will withdraw the demand to avoid the risk of paying your legal costs.

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Court hearing

If the matter is not resolved by negotiation, we will:

  • file your application and supporting affidavit at the Supreme Court of Western Australia;
  • attend one directions hearing;
  • prepare written legal submissions; and
  • prepare for and represent your company at the court’s hearing of your application.

If you succeed, the court will usually order the creditor to pay your legal fees assessed by reference to the court’s scale.

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FAQs

A creditor’s statutory demand for payment of a debt (Form 509H) is the corporate equivalent of a bankruptcy notice. It requires a company to pay a debt within 21 days or apply to a court to set the demand aside. A company that does neither will be presumed insolvent and the creditor will then be able to issue winding up proceedings.
The liquidator is required to act in the interests of the creditors. He/she takes control of the company and its assets and manages its affairs without reference to the directors. He/she will sell the assets and may pursue any of the company’s claims against others – including its directors! The liquidator’s fees are payable from the company’s assets. The liquidator must lodge a report with ASIC as to the company’s affairs. Ultimately, the company will be deregistered.
No. If you successfully set aside the demand, it is open for the creditor to commence court proceedings against you in the usual way. In an application of this sort, the court is only looking at whether there is a genuine dispute or a genuinely asserted offsetting claim – it does not finally decide who is right.
You will usually be entitled to an order that the creditor pay your costs if you are successful in setting aside the demand. These costs are assessed in accordance with a legislative scale and are usually less than what you pay us.
No, the court rules require a company to be represented by a lawyer. Further, the law in this area is very technical and minor mistakes can be fatal to the application.
Immediately. If you don’t pay the debt within 21 days or apply to the court to set it aside, you cannot later challenge the demand.The sooner you contact us, the more options we will be able to offer you. Whilst we will always do our best to help you, it takes time to prepare a court application. If you delay, we may not be able to assist you.
You may be able to challenge a demand if:
  • you dispute you owe the creditor the money;
  • the creditor owes you money (i.e. an offsetting claim);
  • if the demand is defective and that defect results in a substantial injustice (for example, the demand does not clearly state the amount you must pay); or
  • for some other reason (for example, the demand is an abuse of process).
You must file and serve your application on the creditor within 21 days of receiving the demand. It is not possible to extend this deadline.

Why choose Curae Law?

Clear, compassionate and strategic support when you need it most.

01.
We simplify the process
We’ll guide you step by step with practical advice and clear communication, so you always know what to expect. Read what our clients say.
02.
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From paperwork to court proceedings, we handle the details so you can focus on what matters most — your wellbeing and peace of mind.

03.
We're trusted experts

With hundreds of disputes resolved — big and small — we bring deep experience, legal know-how, and genuine care to every client we support.

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Michael is an experienced succession and property lawyer and has served the Western Australian community as a legal practitioner for over 27 years at Curae Law.  Michael has represented clients, both in and out of court, in matters spanning……
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Testimonials

What our clients say

Laura was exceptional to deal with, she chased up all parties associated with this settlement to ensure all deadlines were met. Haven’t had a settlement agent go over and above like this before. I will recommend her services to anyone who asks and use her exclusively moving forward, Thanks again Laura.
Ms T - Flat Rate Settlements Client
May 5, 2026
Dear Michael, Thank you so much, I greatly appreciate your help and kindness in helping me to finalise [deceased’s] Estate.
Ms N - Perth Probate Centre Client
May 3, 2026
Michael Hodgkins was recommended to us by another lawyer due to the complexity of 2 tragic losses we had suffered more than 12 months ago. Due to our situation being so complex, Michael Hodgkins guided us through this extremely difficult time with professionalism, kindness and empathy to ensure the Estates were completed with the least amount of stress possible. All of our communications and queries were answered promptly and dealt with seamlessly. The entire staff at Curae Law were knowledgeable and professional and always went the extra mile, we can’t thank you enough.
Ms K - Perth Probate Centre Client
May 1, 2026
Amazing service Laura was on top of everything and kept us informed along the way, even pushed us when we needed it. Thanks so much for making this process so easy. Definitely use Flat Rate Settlements in the future.
Ms L - Flat Rate Settlements Client
April 21, 2026
I have settled with Flat rate for multiple properties and they are a fantastic team. Definitely recommend, Chris usually handles my properties and he has been amazing. I will definitely be staying on with them for all other future ventures I may have.
Mr M - Flat Rate Settlements Client
April 20, 2026
Michael and Sean were compassionate and upfront about the process of settling an estate. They were clear and provided step by step advice at an exceptionally difficult time for our family. Their pricing is transparent and information about payments was clear and consistent. I would recommend the team to anyone seeking advice for and support with a deceased estate.
Ms Q - Perth Probate Centre Client
April 18, 2026