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The main grounds are a genuine dispute on substantial grounds, a cross claim equalling or exceeding the debt, security held for the debt, and other reasons the court considers sufficient, which in practice includes serious procedural and service defects. An individual debtor has 18 days from service to apply. Careful drafting and evidenced service close off most of the risk.
The Insolvency Rules 2016 allow an individual to apply to set aside a demand where the debt is genuinely disputed on grounds which appear substantial, where the debtor has a counterclaim, set off or cross demand equal to or more than the debt, where the creditor holds security equal to or more than the debt, or where the court is satisfied on other grounds that the demand ought to be set aside. Trivial slips in the form will not usually succeed, but a demand for a materially wrong sum, or one the debtor can show never validly reached them, is vulnerable.
Disputes about the debt are matters for the creditor’s solicitors; disputes about service should never arise. Personal service by a professional who identifies the debtor, or a properly evidenced sequence of attempts followed by an appropriate alternative method, gives the court a clean record of when the demand was served and the time limits engaged. A vague account of posting something through an unverified letterbox is exactly the material set aside applications are built on.
Where a demand is set aside, the creditor commonly pays the debtor’s costs, and a demand set aside for abuse, for instance one served on a plainly disputed debt, can attract sharper criticism. The economics therefore favour doing it once, properly: solicitor checked drafting, professional service from a fixed fee, and the certificate or affidavit ready before the compliance clock even starts.
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This page provides general information about the law and practice in England and Wales and is not legal advice. Rules change and individual circumstances vary; always take advice from a solicitor on your specific situation. Prices shown are indicative, exclusive of VAT and confirmed in writing before any work begins.