The threat of winding up proceedings is often all that is needed to bring pressure to bear on the customer to pay. If winding up proceedings are commenced, the debtor company may find very quickly that it cannot continue to trade and in any event will have to pay substantial legal costs to extricate themselves from the proceedings.

One question that is often asked by Creditors is: Don’t we have to serve a Statutory Demand first? The problem with serving Statutory Demands being of course that you have to wait 21 days from the date of service. The answer basically is no. 

In a Court of Appeal decision (Taylors Industrial Flooring Ltd v M & H Plant Hire (Manchester) Ltd), the Court concluded there was no requirement for a Creditor to serve a Statutory Demand before presenting a winding up petition.

The only criteria the Creditor must meet before threatening winding up are:

• The debt is at least £750.

• There is no genuine dispute about the debt.

We recommend a selective approach to the use of winding up letters but they can be very effective. 

We charge the same fee as for seven day letters and they can be faxed to the customer within an hour of receipt of your instructions.

If you would like more information on our range of debt recovery and credit management services