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HI XXXXXXXX As it is a company that you are dealing with you have 2 options. 1. you can send a letter of demand advsing them that their cheque has bounced and that you are adding the costs of the dishonour fee to the account. If they fail to pay within 14 days that you are going to commence proceedings. 2. You can send them a Statutory demand under the corporations act. Here is some information about statutory demands for your attention. Statutory Demands What is a Statutory Demand? Section 9 of the Corporations Law defines a Statutory Demand as: A document that is or purports to be a demand served under Section 459E of the Corporations Law; Section 459E provides that a creditor may serve on a company a statutory demand for a single debt that is due and payable by the company to the creditor or two (2) or more debts due and payable by the company, the total of which must exceed $2,000.00. When can you use a Statutory Demand? After you have obtained default judgment OR Before you commence proceedings by way of Statement of Liquidated Claim. NB: Only use Statutory Demand to commence proceedings where you are ABSOLUTELY SURE that there is NO possibility of a dispute. What must a Statutory Demand show? Specify the debt and its amount or if there is more than one debt, the total amount of all debts. Must relate to a debt or debts which are due and payable at the date of the demand. NB: They cannot relate to contingent, prospective liabilities or unliquidated damages. It MUST demand the company to pay the amount of the debt or total amount of debts within twenty one (21) days after the demand is served or secure the payment of the debt or debts within a reasonable time. It MUST be in writing (see Form 509H). MUST be in the prescribed form (as per Form 509H). MUST be signed by the creditor or on behalf of the creditor, e.g. solicitor. Traps for the unwary You must be careful of the manner in which you stipulate the amount of the debt, in particular the way interest is claimed. You must state in paragraph (1) of the form the amount of the debt and the interest due as at the date of the Statutory Demand in one figure. The Court will declare a Statutory Demand as defective, if you state the amount as follows: "$179,722.73 together with interest from 11 March 1993 to date and continuing being the amount of the debt in the Schedule." Where there are two or more debts, the Court is undecided if a total amount of the individual debts should be specified. We recommend that in such a situation that you identify each individual debt and its amount and the total of the debts be inserted into the Statutory Demand to eliminate the possibility of challenge. Form 509H must be signed by the Creditor and/or the Creditor's solicitor. Other accompanying documents A Statutory Demand must be accompanied by an Affidavit Supporting Statutory Demand where there is no judgment. An Affidavit in Support of Statutory Demand should contain the following information: Traps for the unwary Incorrect information supplied on the Affidavit. Not sworn correctly. The existence of a dispute will result in the Statutory Demand being set aside. The Affidavit not in the prescribed form: Form 154FA. Must refer to the parties as debtor or creditor. Must contain important Notice on the bottom of Affidavit. Must not have a Court proceedings title or number. (This is because Court proceedings have not been commenced yet.) Service of a Statutory Demand The Statutory Demand must be served on the registered office of the company (you must do an Australian Securities Commission's Search). You cannot serve a Statutory Demand on a foreign company as separate procedures are in place to wind up foreign companies. Applications to Set Aside Statutory Demands Statutory Demands can be set aside on one or more grounds, provided that they file Application to Set Aside Judgment within twenty one (21) days of service of the Statutory Demand. The Application to Set Aside Statutory Demand must be accompanied by an Affidavit Supporting the Application to Set Aside. Both the requirements must be satisfied within twenty one (21) days of service. Grounds for Setting Aside a Statutory Demand There is genuine dispute. The debtor has an offsetting claim. There is a defect in the Statutory Demand, which causes substantial injustice to the debtor. Any other reason the Court can be convinced to set aside the Statutory Demand. Effect of the Order Setting Aside of the Statutory Demand The Court may set aside the Statutory Demand or vary it. Dismiss the application to set aside. Where the Statutory Demand is set aside the Court may order costs to be paid by the person who served the Statutory Demand. So be sure before you serve a Statutory Demand Usually a statutory demand will do the trick and you will need to speak to a solicitor in your state to assist you in preparing and serving the Statutory demand. I hope this is of assistance and if so please click on the accept button

Expert:	Leon Rizos
Pos. Feedback:	98.9 %
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Answered:	11/4/2009

Solicitor

BEc Dip Ed, Dip Law (SAB)