A statutory demand is a notice sent to a debtor (someone who owes you money) which states the amount of the debt as of the date of the demand.
It informs the debtor of the purpose of the demand, the time in which the demand is to be complied with, and that if the demand is not complied with, bankruptcy proceedings may be commenced against the debtor.
Note: A statutory demand is not the only way to show that a debtor is unable to pay the debt. Refer to Section 312 of the Insolvency, Restructuring and Dissolution Act for more information.
Prepare the statutory demand in accordance with Form PIR-2 in the First Schedule of the Insolvency, Restructuring and Dissolution (Personal Insolvency) Rules.
The required information includes:
Refer to Rules 64 and 65 of the Insolvency, Restructuring and Dissolution (Personal Insolvency) Rules for more information.
You need to serve the statutory demand on the debtor. This means taking reasonable steps to bring the statutory demand to the debtor's attention, and making attempts to deliver a hard copy of the statutory demand to the debtor in person. This is known as personal service.
Only if personal service has failed, you may bring the statutory demand to the debtor's attention in one of the following ways:
You may proceed to file a bankruptcy application if both of the following happen:
You need to file the bankruptcy application within 4 months after the date of service of the statutory demand.