IT IS THE CLAIMANTS’ JOB TO SERVE THE CLAIM FORM ON TIME: HIGH COURT REJECTS ARGUMENT THAT DEFENDANTS WERE ESTOPPED FROM TAKING THE POINT: CLAIMANTS’ OTHER ARGUMENT COME TO GRIEF

We are always seeing new ways in which mistakes are made in relation to service of the claim form. In Lonsdale & Ors v Wedlake Bell Llp & Ors [2022] EWHC 2169 (QB)the claimants agreed an extension of time to serve the claim form to a certain date. The claimants did not serve by that date. Attempts were made to blame for the defendants for the claimants’ (solicitors) error.  Those attempts were unsuccessful. The defendants were not estopped from taking the point in relation to late service.  The claimants application for an order that late service be effective, or that service be dispensed with, were equally unsuccessful.

THE CASE

The claimants brought an action alleging professional negligence by the defendants. An agreement was made to extend time for service of the claim form.  The claim form was not served within the period the parties had agreed. The claimants issued a second claim form. This application related to issues of service in relation to the first action.

John Kimbell QC, sitting as a Deputy High Court Judge, outlined the procedural position.

1. 1. The July Claim Form was sent to RPC by AES by email on 20 July 2021. The email stated explicitly that the Claim Form was not being formally served. The parties agreed to a stay on any substantive steps in the litigation and began discussions about mediation.

1. 1. The four-month window for service of the Claim Form under CPR r. 7.5 (1) was due to expire on 12 November 2021. In September 2021, the parties agreed an extension of time for service pursuant to CPR r 2.11. The revised deadline was 1 December 2021. However, the July Claim Form was not in fact served until 19 January 2022. A further claim form (‘the December Claim Form‘) was issued on 16 December 2021. The December Claim Form has the same parties and contains the same substantive claims as the July Claim Form.

1. The issue before the Court is essentially whether the Claimants should be confined to proceeding with the December Claim Form or whether they are entitled to rely on the July Claim Form.

CLAIMANTS’ ARGUMENT OF “ESTOPPEL” REJECTED

The claimants argued that the defendants’ conduct was such that they were estopped from relying on late service. In fact, the judge found, the difficulties arose because of mistakes made by the claimants’ solicitors.   There was no argument in relation to estoppel available.

1. The parties were not in a contractual relationship which is the standard field of operation for promissory estoppel. Their relationship was simply that of parties engaged in civil litigation. The reasonable expectations they have of each other are defined by the civil procedure rules and their communications with each other ought to be interpreted in the context of that framework of rules. In order for the Defendants to be estopped from relying on a procedural right under the CPR, there must be an unequivocal representation that they are forgoing that right.

1. 1. In my judgement, none of the emails from RPC relied upon by the Claimants as giving rise to a representation that the Defendants were willing to waive any of their procedural rights, come anywhere close to being a representation to that effect. If anything, the opposite is the case.

1. 1. The communications between the parties suggested that they were both intending to observe all necessary formal procedural steps. It was the Claimants who when offered a standstill agreement decided to issue proceedings. It was also the Claimants who suggested that notwithstanding any stay which might be agreed on taking other steps pending a mediation, it was their intention to “serve [ the July Claim Form] within the four month period for doing so”.

1. 1. In the first of the statements relied upon by Ms Haren in support of her estoppel argument, the email from RPC of 4 August 2021, RPC specifically carved out of any stay two matters: the restoration of Cumberland Ellis and service of the claim form (or an extension of time for so doing). The parties were agreed at this stage that any stay for mediation should not extend to service of the claim form. Both were insisting on their formal rights in respect of service.

1. 1. The parties thereafter acted in accordance with this mutually expressed intention. It was AES on behalf of the Claimants who proposed an extension of the four month period in which to serve the July Claim Form and sent to RPC a consent order to formally record that agreement. Far from suggesting that such formality is not required (in fact according to the decision in Thomas only an exchange of letters rather than a consent order was necessary), RPC duly signed the consent order on behalf of the Defendants which is then submitted to court by AES.

1. 1. It was common ground that the reason for the choice of 1 December 2021 in the consent order was that it was hoped that a mediation would take place by November 2021. When on 1 November 2021, RPC wrote to say that this would not be possible and suggesting (i) January for the mediation and (ii) agreeing a further order to extend the date for service of the Claim Form, it is, in my judgement, clear that RPC were inviting AES to agree both matters i.e. a new date for a mediation and a new date by which the July Claim Form had to be served. It was open to AES to say ‘No’ to one or both. RPC could not compel the Claimants to accept either suggestion. The ball was plainly in the Claimant’s court to say whether and, if so, on what terms they would accept a later mediation than had been planned hitherto.

1. 1. I can see no basis whatsoever for the suggestion that the Defendants were representing in their email of 1 November that there was no need to agree a new date by which the July Claim Form needed to be served or that service of the July Claim Form should now be subsumed within a general stay for mediation. Quite the opposite, RPC expressly referred to “a further order” to extend time. Clearly RPC expected AES to send a further consent order for their agreement.

1. 1. I do not accept what Ms Sigurdson says in paragraph 29 of her witness statement. There she says, “The only fair reading of these emails [i.e. The emails of 4 August 2021 and 1 November 2021] is that RPC agreed that the Claimants did not need to take steps to effect service until at least January 2022; in fact they were positively requesting that they should not do so.” Read in light of the previous conduct and communications of the parties, it is plain that what RPC expected AES to do was to say: (a) whether or not they agreed to a mediation taking place in January 2022 and (b) whether they wished to extend the date for service of the July Claim Form again or just wished now to serve it and then agree a stay (as AES had previously suggested on 9 August 2021).

1. 1. It ought to have been clear to the case handlers at AES that they needed to respond to RPC’s email of 1 November 2021 one way or the other before 1 December 2021 when the agreed deadline for service of the July Claim Form expired. Even if it was reasonable for Ms Sigurdson to believe that the submission of a consent order extending time would be a formality once a new date had been agreed, her witness statement contains no credible explanation as to why RPC’s email of 1 November 2021 was not responded to in the four week period between it being received and the expiry of the agreed period of service.

1. It ought to have been obvious to any reasonably competent solicitor that there is all the difference in the world between inviting RPC to agree an extension before 1 December and inviting them to so after that date had expired. Before 1 December, if RPC declined to agree an extension, the Claimants could have simply served the July Claim Form by sending it by post. By contrast, after 1 December 2021, with the claim form now expired, the option of serving in the absence of agreement was lost. It is all the more surprising that AES failed to respond to the 1 November 2021 email until after the July Claim Form expired given that it was issued because AES had formed the view that limitation was potentially “looming”. Whatever the reason why AES did not respond to RPC’s email of 1 November 2021 before the July Claim Form expired, I am not persuaded that the Defendants represented that there was no need for an agreement in writing or that there was no need for the Claimants to take any steps to effect service until January 2022. The correspondence supports the opposite conclusion. RPC expected AES to either serve the July Claim Form or agree a new long stop date for service. The estoppel argument therefore fails.

CLAIMANTS’ UNSUCCESSFUL ATTEMPTS TO RELY ON CPR 6.15

The claimants then attempted to argue that the court should make an order under CPR 6.15 declaring that the sending of the sealed claim form in July 2021 (when it was said not to be by way of service). The claimants were not successful.

1. 1. As to the level of diligence to be expected of a Claimant, Lord Sumption was at pains to stress that the bar must not be set too high. He accepted the submissions that it was “not necessarily a condition of success in an application for retrospective validation that the claimant should have left no stone unturned.” The test of diligence was expressed as follows: “It is enough that he has taken such steps as are reasonable in the circumstances to serve the claim form within its period of validity.”

1. 1. The reason why there was no diligence to weigh in the balance on behalf of Mr Barton was that:

“Mr Barton made no attempt to serve in accordance with the rules. All that he did was employ a mode of service which he should have appreciated was not in accordance with the rules.”

1. 1. Mr Halpern relies on the following observation by Lord Sumption:

“I note in passing that if Mr Barton had made no attempt whatever to serve the claim form, but simply allowed it to expire, an application to extend its life under CPR rule 7.6(3) would have failed because it could not have been said that he had “taken all reasonable steps to comply with rule 7.5 but has been unable to do so.” It is not easy to see why the result should be any different when he made no attempt to serve it by any method permitted by the rules.”

1. 1. In my judgment, the Claimants in this case find themselves in the same position as the hypothetical claimant envisaged by Lord Sumption in the passage above. AES took a conscious decision to send the July Claim From to RPC and asked then not to treat this as service under the CPR. In doing so they made clear to the RPC that they fully understood that they would need to serve it within four months or agree an extension in writing, which is precisely what they did. Thereafter as the procedural chronology above makes clear, that deadline passed with the no attempt being made to serve the July Claim Form or to agree a new extended date. It could have easily been served at any time in the four weeks between 1 November 2021 and 1 December 2021 but was not.

1. 1. In my judgement, therefore the Claimants did not act with reasonable diligence between 1 November 2021 and 1 December 2021. They courted disaster by failing to respond at all to RPC’s letter of 1 November 2021 until after the agreed deadline for service of the July Claim Form had expired.

1. 1. The factor on which Ms Haren concentrated most heavily was the Defendants’ behaviour. She submitted that:

78.1 The failure formally to serve the claim form was a result of the request and/or encouragement of the Defendants not to serve proceedings prior to the mediation.

78.2 RPC led the Claimants to believe that they would agree to a further extension of time for service of the claim form. They did nothing to withdraw from that until after the time for the service of the claim form had expired, despite being aware of the date for service.

78.3 The Defendants’ refusal to agree a further extension of time for service after 1 December 2021 was “wholly opportunistic”.

1. 1. I do not accept these submissions. In my judgement, RPC bear no responsibility whatsoever for the non-service of the July Claim From. Taking each of Ms Haren’s points in turn:

79.1 In their email dated 1 November 2021 the Defendants did not encourage or request the Claimants not to serve the July Claim Form. They merely informed the Claimants that they would not be able to mediate until January 2022 and asked whether the Claimants were willing to wait that long (and, if so, to send proposed dates). RPC certainly signalled a willingness to agree a new extension for service of the July Claim Form but is in my judgement it was for the Claimants to say ‘yes’ or ‘no’ to the proposed new mediation date and either serve the July Claim Form or propose a new longstop deadline for service. AES did neither.

79.2 It was reasonable for RPC to wait for AES to respond to the email of 1 November 2021. RPC cannot, in my judgement, be criticised for not chasing AES or not reminding them that the deadline for service of the July Claim Form was about to expire. It was solely a matter for AES to decide whether to serve the Claim Form or agree a new deadline. As Carr LJ said in R(Good Law Project) v Secretary of State for Health and Social Care [2022] 1 WLR 2339:

“Provided that a defendant has done nothing to put obstacles in the claimant’s way, a potential defendant is under no obligation to give any positive assistance to the claimant to serve. The potential defendant can sit back and await developments…. Thus, there is no duty on a defendant to warn a claimant that valid service of a claim form has not been effected.”

79.3 I also reject the suggestion that RPC’s conduct was opportunistic. They dealt with matters reasonably as they unfolded. A request to agree a retrospective extension of time after a claim form has expired is a very different thing to a request before time has expired. RPC was entitled to raise the issue of whether it was even possible to extend time retrospectively and was obliged to have regard to their clients’ interests by taking account of any potential limitation defence which might be lost if they agreed. Having done so, they declined to agree the extension.

1. 1. I am not satisfied therefore that there is a good reason to exercise the power under CPR r 6.15(2) for the following reasons:

80.1 The Claimants failed to take reasonable steps to effect service by 1 December 2021 or to agree a further extension in writing for service of the July Claim Form.

80.2 The Defendants did nothing to create or contribute to the difficulty. On the contrary, the Defendants suggested a new date for mediation and indicated a willingness to agree a new extension. The Claimants’ solicitor failed to respond to either proposal.

80.3 It was reasonable for the Defendants’ solicitor to sit back and await developments after sending the email of 1 November 2021. There was, in particular, no duty on RPC to remind AES that the extended deadline for service of the July Claim Form was about to expire before it did expire.

80.4 If the power were exercised, the Defendants would be deprived of a potential limitation defence which is at least reasonably arguable on the basis of the material presently before the Court.

80.5 There is no satisfactory explanation as to why the Defendants’ proposals in the email of 1 November 2021 were not accepted or, failing that, why the July Claim Form was not served on the First, Third and Fourth Defendants by 1 December 2021.

80.6 There are no other factors or circumstances which weigh in favour of the Claimants.

COURT REFUSED TO DISPENSE WITH SERVICE OF THE CLAIM FORM

The judge also refused to make an order dispensing with service of the claim form.

1. 1. The exceptional circumstances threshold is higher than the ‘good reason’ test under CPR r. 6.15. In Bethell Construction Limited v Deloitte and Touche [2011] EWCA Civ 1321, applications were also made under CPR r 6.15 and 6.16. The Chancellor of the High Court said this:

“If the facts of this case do not reveal a ‘good reason’ to make the order regarding service of the claim form sought under CPR 6.15 they cannot possibly disclose ‘exceptional circumstances’ sufficient to justify dispensing with service altogether.”

1. 1. In my judgement, the same applies in this case. For the same reasons as I have found that there is no basis for exercising the power the court has under CPR r. 6.15(2), I find that there are not exceptional circumstances within the meaning of CPR r. 6.16. Indeed, the first instance judge’s description of what happened in Bethell as reproduced at [27] in the judgment of the Court of Appeal is equally apt to describe what (in summary) has happened in the present case:

“..this is not a case where the claim form was delivered to the defendants within the period for service by a method of service which the claimants and their solicitors thought was a reasonable method of service. The claim form had been delivered expressly not by way of service, and was never delivered to the defendants again; nor was any statement made that by serving the particulars of claim the claimants were treating the claim form as having, by that act, been served. There was nothing to suggest that the claimants were regarding the not-by-way-of-service condition attached to the previous delivery of the claim form as in any way having been extinguished. Again, it seems to me that it would be an impermissible exercise of the power under the rule to dispense with service of the claim form in those circumstances.”

1. 1. In this case, the Claimants made a strategic decision to issue (but not serve) the July Claim Form in July 2021. They agreed one extension to the period for service but then failed to serve the July Claim Form within that period and failed to agree another extension. In the circumstances, this is not a case which can conceivably amount to exceptional circumstances to justify dispensing with service altogether.

Disposal

1. Accordingly, the Claimants’ application is dismissed and the Defendants’ application succeeds. The service of the July Claim Form on 19 January 2022 is set aside because it had expired by the time it was served. The Court therefore has no jurisdiction to hear the claims in the July Claim Form. I would ask the parties to agree an order to give effect to this Judgment in the usual way.