CLAIM FORM CASE IN THE COURT OF APPEAL: SERVICE OF CLAIM FORM BY UNAUTHORISED BODY DOES NOT RENDER SERVICE VOID (ALTHOUGH IT IS STILL NAUGHTY)

We have managed to get to the 15th day of the year without a service of the claim form case, to compensate for this there are two today.   In Ndole Assets Ltd v Designer M&E Services UK Ltd [2018] EWCA Civ 2865 the Court of Appeal held that service of the claim form by an unauthorised body did not render service void.

“To set aside the service would be to confer an uncovenanted advantage on the defendant in circumstances of (in the present case) adventitious technicality.”

THE CASE

The claimant issued proceedings as a litigant in person.  Service of proceedings was left to a firm called CSD Legal Limited “CSD”, who served the claim form at the correct address and on time. CSD is not a firm of solicitors.  The defendant argued that service by non-solicitors meant that service had not taken place within the rules.  At first instance it was held that that this did not render service void.  A litigant in person was entitled to use agents to serve the claim form.

ON APPEAL

The Court of Appeal upheld the first instance decision, albeit for different reasons.

SERVICE OF THE CLAIM FORM IS “CONDUCT OF LITIGATION”

The Court of Appeal rejected the defendant’s argument that service of the claim form was not conduct of litigation, and therefore a reserved activity.  However this did not render service of the claim form void.

  1. The overall conclusion therefore has to be that formal service of a claim form on a defendant falls within the “conduct of litigation” for the purpose of the 2007 Act. It is therefore a reserved legal activity which can only be performed by a statutorily authorised person or by an exempt person. And CSD were neither.
  2. How, then, does one get over the apparent problem that the same might be said (and as the judge seems to have thought) of process – servers or postal employees? And what if the litigant in person, if an individual, asks a family member to deliver the claim form or, if a company, asks an employee to do so: is the conclusion compelled that such a family member or employee is to be adjudged to have committed an offence? Such a conclusion is, as is agreed all round, unacceptable.
  3. In my view this is where substance has to prevail over form. I acknowledge that it is not always appropriate to talk in terms of degrees of agency. But it all depends. In my view the pragmatic solution here, which is the one proffered by Mr Darling, is the correct solution. That distinguishes between those who merely perform an administrative or mechanical function in connection with service of documents and those who undertake, or who have assumed, legal responsibility with regard to service as prescribed by the rules. This in fact, I consider, accords with the acceptance by the court in Agassi in paragraph 43 of the judgment that the statutory prohibition does not extend to “what might be termed purely clerical or mechanical activities.” Thus the solution is to be found not so much in focusing on the issue of agency or sub-agency but in focusing on the actual role of, and the actual activity undertaken by, the person in question. That is why process-servers and the like are not within the statutory prohibition: they are simply engaged in the “mechanical” activity of actually delivering the claim form. Delivery, for these purposes, is not to be equated with service of a claim form as prescribed by the rules.
  4. The question thus becomes one of fact and degree in each case. Ms Sinclair submitted that would lead to uncertainty. But as to that I strongly suspect that issues of the present kind with regard to service of a claim form are likely to be rare; and in the more general context of the right to conduct litigation, an approach permitting individual assessment of the activity undertaken in an individual case is, by reason of its very adaptability to the circumstances of the particular case, much more likely to achieve justice than a rigid application of an agency-based approach.
  5. Finally, then, on the evidence were CSD themselves performing merely an administrative function or mechanical activity in serving the claim form as they did?
  6. It is plain that CSD believed that they were acting entirely properly and lawfully. Care had been taken to ensure that it was the claimant (not CSD) who actually issued the proceedings; and so far as service was concerned, it is clear from Mr Dain’s witness statement that he thought that he was indeed acting in accordance with Agassi (on his reading of it) and in accordance with the view expressed in MSJ Associates. But while Mr Darling fairly accepted that Mr Dain and CSD acted in good faith, the conclusion cannot be decided by reference to their own, as it were, self-certification on this point.
  7. In my judgment, the course of events, as illustrated by the correspondence, shows that CSD were acting in a way that went significantly beyond performing simply an administrative function or a mechanical activity and shows that they were taking the responsibility for service of the claim form under the rules.
  8. The correspondence is most revealing in this regard. All the letters that CSD wrote were just the kinds of letters that a firm of solicitors might write in preparation for formal service. Indeed, as the judge noted, to the uninitiated they would have appeared to be letters from solicitors. It is true that CSD were, necessarily, acting on behalf of their client, the claimant, with, no doubt, wide general authority given to them to progress the claim. But that, for the reasons given above, does not of itself provide the answer; and, as I see it, their conduct in serving the claim form in the way that they did, culminating in the certificate of service, clearly did on the evidence amount to conduct of litigation – in the sense either of prosecuting the proceedings as issued or of performing an ancillary function in relation to such proceedings or both – without statutory authorisation or exemption. CSD, in serving the claim form and other documents (Particulars of Claim and appendices) as they did, were (in the language of the court in Agassiat paragraph 56) engaging in “formal steps required in the conduct of litigation.” For the avoidance of doubt, my conclusion would still have been the same even if CSD had not engaged in so much surrounding correspondence but had simply sent a letter to the defendant saying they acted for the claimant and enclosing the claim form by way of service under the rules. Still that would , in my view, have been prohibited. The remedy would have been for the claimant itself to have sent the letter of service with an enclosed claim form and for the claimant itself to have instructed couriers to effect delivery. That, in effect, corresponds to the position taken by the claimant in actually issuing the proceedings in the first place: it and CSD correctly understanding the legislation at least in that regard.
  9. So that leads to a consideration of the consequence of service of the claim form having been unlawfully effected by CSD.
  10. It was the submission of Mr Darling that the service of the claim form was accordingly invalid. When pressed as to what he meant by that, he said that the service of the claim form, unlawful means having been used, had been a nullity and of no effect. Alternatively, he submitted that the court should, in its discretion, set service aside.
  11. The consequences of a breach of a statutory provision are, in the ordinary way, to be found in the scheme and terms of the statute itself: see, for example, R v Soneji [2006] 1 AC 340. In the present case, our attention was not drawn to any statutory provision in the 2007 Act stipulating the consequence (in terms of validity) for an act of conduct of litigation being performed by a person neither authorised nor exempted by the statute.
  12. In my view, nullity is not to be taken as the statutorily intended consequence. As Ms Sinclair pointed out, there is no reason why so draconian a consequence should be intended to be visited on the client or principal, who ordinarily will have been entirely ignorant of the point. As she also pointed out, there could be grave implications for other reserved legal activities if it were otherwise: for example, probate activities and reserved instrument activities. In argument, we put to Mr Darling the example of a sole solicitor practitioner who, through oversight and pressure of work, omitted to renew his practising certificate in time. Would all proceedings served by him in the ensuing period before the position was rectified thereby become entirely null and of no effect? He acknowledged that might seem an unduly restrictive and harsh approach: whilst not withdrawing his submission.
  13. In my judgment, such a conclusion is not acceptable and is not compelled by the language of the 2007 Act. Moreover, that does not mean that there is no sanction available. On the contrary there are sanctions available in the form, in an appropriate case, of criminal process and sentence and a contempt application. And those sanctions are directed at the right target – that is to say, the person who has actually engaged in the unlawful conduct of litigation.”

 

THE RESULT

Service of the claim form was held to be “valid”, in the sense that service was not set aside.

    1. It follows that service in this present case is to be taken as valid unless the court were to decide to set it aside. I can see no reason whatsoever for so ordering. To do so could appeal to no sense of the merits. The claimant and CSD acted in good faith. They positively thought that they were complying with the law. There was nothing inherently unlawful, of course, in serving legal process: the unlawfulness arose solely from the involvement of CSD for this purpose. The defendant can certainly gain no support from the Supreme Court decision in Patel Mirza [2017] AC 467. Moreover, CSD had endeavoured to serve the claim form before the expiry of the limitation date (the claim having been assigned to the claimant late in the day). The proceedings were in fact delivered and came to the attention of the defendant and its solicitors. To set aside the service would be to confer an uncovenanted advantage on the defendant in circumstances of (in the present case) adventitious technicality. I add that I would reach the same conclusion even if one were to view this as an application for relief from sanctions (although I do not consider, as will be gathered, that strictly it should be so viewed). The position, I add, is also very different on the facts from that in Barton v Wright Hassall [2018] 1WLR 1119.