What to do if you receive a Statutory Demand

As briefly and simply as we can explain it: both Abbey National and Nationwide have started threatening – and using – Statutory Demands to bludgeon repossesses into paying shortfall demands.

Carol Riley’s National Association of Mortgage Victims, working with Mary Ward Legal Centre’s Ahmad Butt, has done a great job of having two of Nationwide’s thrown out of court. We don’t yet know if anyone has beaten off any of Grabbey National’s.

Here’s how they work – and how to beat them.

Grabbey or Nationwide send a letter demanding that you pay the unproven debt within 21 days. This is the statutory demand. Somewhere in the wording will be a threat to make you bankrupt or insolvent if you don’t pay up within those 21 days.

You have 18 days from the date of the letter to get to court and file an application for set aside. You’ll need to go to the court to get the two forms you need to do this. According to one advisor, the forms are not very user-friendly so you may want to take them down to your local Citizens Advice Bureau for help filling them out.

Once you’ve filled them out you must hand them back in at the court, where you will also have to swear an affidavit. This is a lot less scary than it sounds. It’s where you say why you want the Demand set aside. Your reason is that the lender will not prove the debt and that you think the MIG was missold so you want the lender to justify it or go through Civil Procedure Rules or a court hearing.

If you’ve been following the Home Repossession Page’s suggestions you’ll already have a ream of letters from the lender, which evade the issue of giving you the proof, you want. If you haven’t been following the Home Repossession Page’s suggestions, here’s a good reason why you should.

Our main source says:

“The proper use of such demands is where the court is used to instigate the distribution of a debtor’s assets in obvious cases of undisputed, proven debt. Make the affidavit part of your application for set aside VERY clear; it has been known for judges to refuse set aside even when it is obvious that the demand was an inappropriate action.”

If you don’t apply to have the demand set aside, the lender will likely go to court and ask to have you made bankrupt. This should involve a hearing and you should be notified of it and have a chance to put your case against it. But your chances are a lot better if you get the original Statutory Demand set aside.

And if all this sounds like a nightmare… yup!

That’s why Grabbey National and Nationwide do it.

Our source reports a particularly nasty use of Statutory Demands by Curtis solicitors of Devon.

“After three letters, within ten days of the third, if their claim is not disputed and just ignored, Curtis may serve a statutory insolvency demand upon you (SID). If you haven’t made your position clear to them, they will ‘twist’ the law and use a SID to make you bankrupt – sounds unbelievable but true! SIDs are inappropriate where no money judgement orders are issued and/or claims are disputed but if you just keep quiet it will be Curtis’ hope that these facts are overlooked by a judge reading their SID, especially when you’ve been shown to be uncooperative by not communicating – you’ll be assumed to be in the wrong. It’s crazy but all of a sudden the onus of proof goes to you, and will probably involve using a solicitor – not the end of the world but still costs time, hassle and money.

IT MAY BE WISE TO ACT VERY QUICKLY [if Curtis is pursuing you]. If you chose to do so, send your correspondence by recorded delivery it needn’t say anymore than is advised on the home-repo website but make it very clear that you are treating the situation seriously but require proof of the claim before you can proceed.


Leave a Reply

Your email address will not be published. Required fields are marked *