A CLAIM FORM CASE IN THE COURT OF APPEAL: GOOD NEWS FOR CLAIMANTS: STAY A WHILE AND FIND OUT

In the judgment today in  Grant v Dawn Meats (UK) [2018] EWCA Civ 2212 the Court of Appeal held that an order staying an action also imposed a stay on the obligation to serve the claim form. The claim form was served within time when it was served within four months of the stay expiring.

“… it is right to note that, in the present case, there has been an element of opportunism on the part of the respondent which I would be reluctant to reward. The absence of a served claim form did not in fact make any difference to the progress of this case.” 

THE CASE

The claimant issued proceedings under CPR Part 8, using the Protocol for Low Value Personal Injury Claims.  Upon issue the claimant applied for a stay. Several stays were granted, up to the 30th November 2016. The claimant served the claim form within four months of the day that  the stay was ended.   The defendant sought to strike out the action on the grounds that proceedings should have been served within four months of issue, regardless of the stay. That argument was rejected by the District Judge but accepted by the Circuit Judge. The claimant appealed to the Court of Appeal.

THE JUDGMENT OF THE COURT OF APPEAL

The Court of Appeal allowed the claimant’s appeal.

THE COURT OF APPEAL JUDGMENT

The Court of Appeal considered the authorities in relation to the effect of a stay.

1. As the various citations at paragraphs 10 and 11 above make plain, a stay operates to ‘halt’ or ‘freeze’ the proceedings. In general terms, no steps in the action, by either side, are required or permitted during the period of the stay. When the stay is lifted, or the stay expires, the position as between the parties should be the same as it was at the moment that the stay was imposed. The parties (and the court) pick up where they left off at the time of the imposition of the stay.

2. In the present case, the stay expired on 30 November 2016, when it was not renewed. The stay (or more properly the original stay and its extension) had been in operation since 7 July 2017, which was 13 days after the proceedings had been issued. Thus, on an application of the usual principles relating to a stay, the appellant had 4 months (less 13 days) from 30 November 2016 in which to serve the claim form, which meant that, to be in time, service had to be effected on or before 17 March 2017. On this basis, since the claim form was served on 6 March 2017, the claim form was served in time.

3. That conventional analysis would be wrong only if there was a reason to treat the service of the claim form as different to any other procedural step, such as the service of, say, the particulars of claim. That was indeed Mr Arentsen’s basic submission: he said that the service of the claim form “stands alone”, and so was required in any event, regardless of the stay imposed by the court. At the close of his oral submissions, he summarised his case by contending that, until the proceedings were served, “there was nothing to stay”.

4. For a variety of reasons, I do not accept those submissions: I consider them to be contrary to the CPR, and also to lead to consequences which the rules cannot conceivably have intended.

5. First, the rules do not say that the service of the claim form stands outside – and is therefore unaffected by – a stay of proceedings. Paragraph 16 of PD 8B is expressly premised on the basis that a party in the position of this appellant must start proceedings (by issuing the claim form), and at the same time, seek a stay of those proceedings. There is no mention of any requirement to serve the claim form in those circumstances. On the contrary, paragraph 16.2 of PD 8B requires the sending of the claim form to the defendant, rather than its service. If Mr Arentsen were correct, there would be no reasons for the rule to require “sending” rather than “service”; because the stay would bite when service was effected. More generally, paragraph 16 would have to be completely reworded if Mr Arentsen was right and the claim form had to be served before any stay could be imposed or come into effect.

6. Secondly, in the context of a stay of proceedings, I can see nothing in the rules to justify distinguishing between the service of the claim form on the one hand and any other procedural step, such as the service of the particulars of claim, on the other. There is no basis for saying, as the judge did, that Edwards-Stuart J’s explanation in UK Highways as to the effect of a stay was not equally applicable to the service of a claim form. The CPR does not make any such distinction. The explanation in UK Highways is therefore equally applicable to the present case.

7. I do not consider that r.7.5 is relevant to the issue on this appeal. The appellant did not seek to extend time for service of the claim form under that rule, and if I am right about the effect of the stay, he had no need to do so. The authorities referred to at paragraph 15 above are therefore nothing to the point. To the extent that it is suggested that the provisions of r.7.5 meant that a stay could not have the effect contended for by the appellant, because only an application under r.7.5 could give the appellant the relief sought, I reject it: there is nothing about r.7.5 which prevents a court-imposed stay from affecting the time limit for the service of the claim form in the usual way. Any other conclusion would be contrary to the plain words of paragraph 16 of PD 8B.

8. Moreover, I do not accept Mr Arentsen’s submission that the passage from the judgment of Lord Sumption in Barton, referred to at paragraph 15 above, somehow elevates the service of the claim form into a step in the proceedings which has to be taken regardless of any stay, or which dictates when the stay comes into force. Lord Sumption was not addressing the question of a stay at all, but was instead dealing with the entirely separate question of the importance of formality in bringing the fact of the claim to the attention of the defendant.

9. Thirdly, I consider that my interpretation of the CPR can be sense-tested in this way. Any other interpretation would make the stay effective for some things (such as service of the particulars of claim), but not for others (such as service of the claim form). That would introduce an unnecessary level of complexity into what should be a straightforward situation. Indeed, as the judge himself noted at [22], such an interpretation would require the appellant to seek a stay, then to apply to lift the stay in order to serve the claim form (and then presumably to apply to re-impose the stay). Such a procedure would be unnecessarily cumbersome, and contrary to the intention that the rules in this area should be straightforward.

10. On a related topic, I should add that, whilst the judge was right to say that, if a claim form is eventually not served at all then it is as if the proceedings had never happened, he was wrong to say that the proceedings “do not really have a legal life” until the service of the claim form. The issue of the claim form creates a lis, regardless of its subsequent service. Moreover, the judge’s acceptance, even if he was right, of the need for the appellant to apply to lift the stay in order to serve the claim form, was itself an acknowledgement that the proceedings do “have a legal life” prior to the service of the claim form.

11. Finally, it is right to note that, in the present case, there has been an element of opportunism on the part of the respondent which I would be reluctant to reward. The absence of a served claim form did not in fact make any difference to the progress of this case. Liability was always admitted. The court ordered a defence by the 17^th of February and the defendant filed and served a defence and counterclaim in accordance with that order. The absence of the claim form did not have any effect on the proper progress of these proceedings. On the other hand, if Mr Arentsen were right, then, having conceded liability, the respondent would not be liable to the appellant for any damages.

12. In a similar vein, although Mr Arentsen sought in his oral submissions to rely on the fact that the appellant had not sent the claim form in accordance with paragraph 16.2 of PD 8B, that was not a point taken before the judge, and therefore not a point that can now arise on this appeal. In any event, it could not bear upon the issue of whether, as a matter of construction of the rules, a stay applies to the service of the claim form.

13. For all those reasons, therefore, I would allow the appeal against the decision of Judge Gore QC. Subject to submissions on the form of the order, I would reinstate the decision of Deputy District Judge Davy dismissing the respondent’s application dated 17 March 2017 for the claim to be struck out for non-service of the claim form; and declare the claim form to have been served in time. The claim form was served within 4 months of its issue, once proper allowance is made for the full period of the stay imposed by the court.