RELIEF FROM SANCTIONS GRANTED FOR LATE SERVICE OF ACKNOWLEDGMENT OF SERVICE: A POINT FOR DEFENDANTS TO WATCH

There are two point missed, surprisingly often, by defendants who want to take a point as to service. The first is that an acknowledgment of service must be served timeously, the second is that an application under CPR Part 11 must be made within 14 days of the acknowledgment of service. What are the implications if the acknowledgment of service is served late?   The issue was considered by HHJ Hacon in  Nokia Technologies OY & Nor v Oneplus Technology (Shenzhen) Co., Ltd & Ors (Rev1) [2021] EWHC 2952 (Pat), where the defendants required (and obtained) an extension of time for filing an acknowledgment of service.  Many issues in relation to the impact of late service on any subsequent application under Part 11 remain unresolved.  This is simply a point that defendants much watch.

 

THE CASE

The defendants took a point that the courts had no jurisdiction to hear a claim in relation to a dispute about various patents.   The judge did not accept that point.  There was, however, an issue about the acknowledgements of service being taken late.

THE JUDGMENT IN RELATION TO LATE SERVICE OF OF THE ACKNOWLEDGEMENT OF SERVICE

The judge considered the argument that the acknowledgment of service was filed late by some defendants and they required relief from sanctions.  He did not decide the issues that could arise from late service, but granted relief from sanctions.

128. Nokia contended that the acknowledgment of service filed on behalf of the UK defendants was out of time.
    1. CPR 11(1) states that a defendant may apply to the court for an order declaring that it has no jurisdiction or should not exercise any jurisdiction which it may have. CPR 11(2) provides:
(2) A defendant who wishes to make such an application must first file an acknowledgment of service in accordance with Part 10.
    1. CPR 11(4) provides:
(4) An application under this rule must –

(a) be made within 14 days after filing an acknowledgment of service; and

(b) be supported by evidence.

    1. The claim form and the Particulars of Claim were served on the UK defendants by courier on 2 July 2021 and service was deemed to have occurred on 6 July 2021. CPR 10.3(1) provides:
(1) The general rule is that the period for filing an acknowledgment of service is –

(a) where the defendant is served with a claim form which states that particulars of claim are to follow, 14 days after service of the particulars of claim; and

(b) in any other case, 14 days after service of the claim form.

    1. The claim form in the present case stated that Particulars of Claim would follow, although in fact Particulars of Claim were served together with the claim form. On the face of matters, the UK defendants were required to file an acknowledgment of service by 20 July 2021. The UK defendants filed their acknowledgment of service on 29 July 2021. On 3 August 2021, the UK defendants applied to challenge jurisdiction.
    1. The UK defendants advanced four arguments. First, the Particulars of Claim served on 6 July 2021 were incomplete in that they made reference to a confidential schedule which was not included among the documents served. CPR 16.4(1)(a) requires a claimant to include in its Particulars of Claim “a concise statement of the facts on which the claimant relies”. Nokia knew that the Particulars of Claim were materially incomplete because the claim form stated that Particulars were to follow. The confidential schedule, not served until 3 August 2021, is referred to four times in the Particulars of Claim and is critical to the FRAND issues set out in the Particulars. It follows that the time for serving the acknowledgment of service started from 3 August 2021, although in fact it had already been filed 5 days earlier.
    1. Secondly, filing an acknowledgment of service late does not preclude a challenge to the jurisdiction under CPR 11.
    1. Thirdly, if the defendants were out of time, there should be an order giving retrospective permission to serve the acknowledgment of service late and relief from sanctions.
    1. Finally, the defendants’ argument on case management has nothing to do with CPR 11 and so remains unaffected by late filing of the acknowledgment of service, even if that is what happened.
    1. The defendants developed these arguments, the second in some detail. I see no need to resolve all the issues raised. I will assume, without finding, that the acknowledgment of service was filed 9 days out of time and that I must apply the usual criteria set out in Denton v TH White Ltd [2014] EWCA Civ 906.
    1. The first stage requires me to consider the seriousness and significance of the defendants’ filing 9 days late. Nokia argued that the rules on timing should be applied strictly and that a delay in proceedings had been prejudicial to them. I fail to see how any such prejudice is possible. If the defendants had filed the acknowledgment of service on 20 July 2021, rule 11(4) would have allowed the defendants until 3 August 2021 to challenge jurisdiction under rule 11. The defendants filed their challenge on that day: 3 August 2021. The breach of the rules which I have assumed was not serious and was of no practical significance.
    1. Where there is no serious or significant breach, as directed in Denton the court is unlikely to need to spend much time on the second and third stages. With regard to the second, Mr Brown’s evidence was that the breach, if there was one, was due to an honest mistake. I accept that evidence.
    1. Moving to the third Denton stage, I have no doubt that in all the circumstances of the case the UK defendants are entitled to relief from sanctions. I give them retrospective permission to the UK defendants to file their acknowledgment of service by 29 July 2021.
Conclusion
  1. The applications of the defendants are dismissed. The UK defendants have retrospective permission to file their acknowledgment of service by 29 July 2021.