An outdated registered office, an unopened letter or an overlooked email can leave your company facing a winding-up application before you realise there is a problem. That risk arises because a statutory demand may still be validly served even if no director has seen it, starting a strict 21-day countdown before you know it has arrived.

What is a statutory demand?

A statutory demand is a formal demand issued by a creditor requiring a company to pay a debt or debts totalling at least $4,000 that are due and payable. Once served, the company generally has 21 days to pay, provide security or reach an agreed settlement to the creditor’s reasonable satisfaction, or apply to the court to set aside the demand.

If the company fails to comply within the required period, creditors may rely on a presumption of insolvency when applying to the court to wind it up and appoint a liquidator.

The critical question is when the statutory demand was served, not necessarily when you opened it or your accountant forwarded it.

How can your company be served?

A statutory demand may be:

• left at or posted to the company’s registered office;
• delivered personally to a director who lives in Australia; or
• sent electronically, including by email, where the electronic service requirements are met.

A statutory demand properly addressed and sent by prepaid post is generally presumed to have been received on the seventh working day after being posted, unless contrary evidence displaces that presumption. Earlier delivery may mean an earlier deadline. The date the envelope is opened is not the test.

How do statutory demands get missed?

The registered office is out of date

You may have moved premises, changed accountants or stopped using a service address without updating ASIC. Updating your trading address or redirecting the mail is not a substitute for updating your registered office.

In a recent case (In the matter of Ulrich Pty Ltd as trustee for Tortuga Trust [2026] NSWSC 381), a demand left at a property the company had sold and vacated was still validly served because it remained the registered office.

The demand reaches your accountant, but not you

Where your accountant’s office is the registered office, service there can start the clock. The deadline does not wait for the demand to be forwarded to a director.

A demand might be missed, uploaded to a client portal without anyone calling you, or forwarded to an old email address. Leave, staff turnover and uncertainty over who is responsible can all delay action.

The email is overlooked

Where the electronic service rules apply, an email can be received for legal purposes when it becomes available to be retrieved at the company’s nominated electronic address. That can include an address the sender reasonably believes is current.

What should you do if a demand turns up?

Immediately seek legal advice. Keep the demand, any supporting affidavit, the envelope and all emails. Record when and how each copy arrived. A lawyer should check the earliest possible service date before calculating the deadline.

To challenge a demand, the court application and supporting affidavit must both be filed and served on the creditor within 21 days after service. The court cannot extend that application deadline.

Negotiations alone do not stop the clock. Obtain written confirmation of any withdrawal or settlement before the deadline expires, and advice on whether it actually resolves the demand.

If the deadline appears to have passed, seek advice anyway. There may be issues with service, defects in the demand or options to resolve the demand. If winding-up proceedings have started, the company may need to prove it is solvent, and raising a debt dispute is more difficult.

How can you reduce the risk?

Directors and accountants should:

• Keep the company’s registered office details with ASIC accurate and up to date. Notify ASIC of a change within 28 days. The change takes effect seven days after lodgement, or on a later date specified in the notice. Monitor the old address during the transition.
• Ensure someone checks mail and business email accounts, including spam folders, daily, with cover for leave. Agree who will call the director, forward the complete documents immediately and confirm they have been received.
• Immediately seek legal advice when a statutory demand is received, even if you dispute the debt or believe it arrived at the wrong address.

To discuss a statutory demand received by your company or a client, please contact Velocity Legal’s specialist disputes and insolvency team.

‍This article in no way constitutes legal advice. It is general in nature and is the opinion of the author only. You should seek legal advice tailored to your individual circumstances before acting on anything related to this article.