Litigation Letter
Statutory Demand Statute Barred
In Re a Debtor (No 647-SD-1999) (Ch D TLR 10 April)
Section 24 of the
Limitation Act 1980 precludes the enforcement of a judgment after the expiry of six years and therefore a statutory demand based on a default
judgment debt obtained more than six years prior to the service of the demand was not a good demand and had to be set aside.
The Inland Revenue argued that s37(2) of the Limitation Act provided that the Act was not to apply to ‘… Any proceedings by
the Crown for the recovery of any tax …’. However the statutory demand was based on the judgment debt and was therefore covered
by the statute. Bankruptcy proceedings based on the statutory demand were set aside.