“IT WAS TWENTY YEARS AGO TODAY”: A BATCH OF SERVICE OF THE CLAIM FORM CASES IN THE COURT OF APPEAL: A CHANCE TO REVIEW (OR REMINISCE..)

The  Court of Appeal judgment in Cranfield & Anor v Bridgegrove Ltd. [2003] EWCA Civ 656 was given 20 years ago today.   One of the aims of that judgment was to clarify issues relating to service of the claim form and cut down on future problems.  Regular readers of this site will know, despite the Court’s best efforts, many issues still remain. There are dozens (possibly hundreds) of cases on this blog alone where issues of service trouble the courts (and perhaps trouble the claimant’s solicitors more).  Similar issues are arising twenty years on. A review of the case provides an opportunity to look at these issues, and to review the law relating to service on the “last known address” in particular.

THE CASE

The court heard five cases relating to issues about the claim form. Four of them were appeals from Circuit Judges, the fifth was directly from a District Judge.

BOTH A SPECTATOR AND A PARTICIPANT

I represented the claimant in the fifth case (appeal from the District Judge) on the meaning of the last known address. The Court of Appeal directed that all Counsel sit through the entire hearing in case there was anything of relevance to their case.  This took two days in court with the fifth case being reached (to my recollection) very late on the second day.  Submissions in that case were, perforce, kept brief.  Judgment was reserved and, on the 14th May 2003, we were allowed into the Royal Courts of Justice very early, to attend the handing down and ask for costs.  I think we had finished by 10.00 am.

THE INDIVIDUAL CASES

Cranfield v Bridgegrove Limited (claimant succeeded)

In this case the court failed to serve the claim form.  The claimant’s claim was originally struck out, but reinstated by the Circuit Judge. The defendant’s appeal was unsuccessful. The Court of Appeal held that the phrase ” has been unable to serve” the claim form  “include all cases where the court has failed to serve, including mere oversight on its part.”

“That conclusion is not undermined by the fact that it is possible to argue that the claimants’ solicitors were at fault in failing to appreciate that there might be a problem, and in failing to ascertain the position before the time for service had expired.”

Claussen v Yeates (claimant failed)

Here the court did not serve the claim form on the defendant’s solicitors because the court had not received confirmation that the solicitors were authorised to accept service.  The claimant’s solicitors did not send the letter on to the court within the four month period.  A copy had been sent to the solicitors, but not the original sealed version.The Court of Appeal refused to make an under dispensing with service under CPR 6.9.   The proceedings had not been properly served.

McManus v Sharif (claimant failed).

Here the claimant sent a draft, unsealed claim form, ” by way of service” to the defendant’s solicitors who had not stated that they would accept service.  The Court of Appeal overturned an order made under CPR 6.9.  The judge had taken too liberal an approach to the issue. The claimant had served an unsealed claim form at an address that was not given for service.

Murphy -v- Staples UK (claimant succeeded, but not on the grounds they appealed on).

In this case the defendant had nominated solicitors to accept service. The claimant served the defendant at its registered office. The judge’s below had exercised a discretion in favour of the claimant. The defendant was appealing the exercise of that discretion (and an appeal based on the exercise of the discretion was likely to succeed). But, and this is a big but, the Court of Appeal  – more particularly Waller LJ – asked in the course of argument whether service under the Companies Act was sufficient.    The Court of Appeal held that service had been effective under the Companies Act. (The defendant’s counsel observed, later, that he had been “bowled out by a ball not in play”).

“83. Our conclusion on this issue is as follows. A claimant may serve the claim form on a defendant company either by leaving it at, or by sending it by post to, the company’s registered office, or by serving it in accordance with one of the methods permitted by the CPR. They are true alternatives. That is made clear by CPR 6.2(2). There are differences between the two methods. For example, service under section 725(1) may be by second class post. CPR 6(1) provides for service by first class post. Service under section 725(1) is deemed to have been effected at the time at which the letter would be delivered “in the ordinary course of post” (section 7 of the Interpretation Act) unless the contrary is proved. CPR 6.7 provides that, where service is by first class post, the document is irrebuttably deemed to have been served on the second day after it was posted. Another difference is that service under section 725(1) must be by leaving the document at, or posting it to, the registered office. CPR 6.2(1) provides for five permitted methods of service.

1. 1. If a defendant has not given an address for service, a claimant may choose whether to follow the section 725(1) or the CPR route for service. In Nanglegan, it was held that, where a defendant elects to give his address for service, and nominates his solicitor to accept service, CPR 6.5(4) requires personal service to be effected upon the nominated solicitor, and not on the defendant. As Thorpe LJ put it (p 1047F) “there will be many cases in which a defendant does not want service either at his residence or at his place of business”. But in that case, the court was not concerned with the interplay between section 725(1) and the CPR, which expressly recognise alternative methods.

1. 1. We accept that it is possible for the parties to make a binding contract whereby the claimant agrees to serve the claim form by the CPR route rather than under section 725(1) or vice versa. But we do not consider that the effect of the letters dated 28 May, 2 and 9 June 1999 was to deny to the claimant the option of serving under section 725(1) of the 1985 Act. In our judgment, the true effect of these letters was not a binding promise by the claimant to serve on the solicitors under CPR 6.4(2). Rather, it was that the parties agreed that, if the claimant decided to effect personal service under CPR 6.4, then they would serve on the defendant’s solicitors rather than on the company under CPR 6.4(4). Allison v Limehouse is authority for the proposition that an ad hoc agreement for service not permitted by the rules is legally effective. We do not consider that it assists in the resolution of the issue which arises here.

1. Our conclusion, therefore, is that the service on the company’s registered office by first class post on 15 March 2002 was good service.

Smith v Hughes and Motor Insurers Bureau (claimant successful – but they have changed the rules since – so be careful).

The claimant had been injured by an uninsured driver.  The MIB were involved and obtain and enquiry agent’s report as to where the defendant driver lived. That report had one last address for the driver but stated that he no longer lived there. The report was sent to the claimant’s solicitors.

Proceedings were issued and the claimant served both the MIB and the driver at his “last known address”. Some time into the action the MIB decided to take the point that the driver had not been properly served. The MIB argued that service could not take place at the “last known address” in circumstances where the claimant knew that the driver did not actually live there.

The Court of Appeal found that service had been effective, on the basis of the rules as they then stood.   The MIB had to concede that this was, in fact, the last known address and could suggest no other.  The evidence on this issue had come from the MIB.

Note the rules have changed since

THE RULES: CPR 6.9(3) – (6).

“(3) Where a claimant has reason to believe that the address of the defendant referred to in entries 1, 2 or 3 in the table in paragraph (2) is an address at which the defendant no longer resides or carries on business, the claimant must take reasonable steps to ascertain the address of the defendant’s current residence or place of business (‘current address’).
(4) Where, having taken the reasonable steps required by paragraph (3), the claimant –

(a) ascertains the defendant’s current address, the claim form must be served at that address; or

(b) is unable to ascertain the defendant’s current address, the claimant must consider whether there is –

(i) an alternative place where; or

(ii) an alternative method by which,

service may be effected.

(5) If, under paragraph (4)(b), there is such a place where or a method by which service may be effected, the claimant must make an application under rule 6.15.

(6) Where paragraph (3) applies, the claimant may serve on the defendant’s usual or last known address in accordance with the table in paragraph (2) where the claimant –

(a) cannot ascertain the defendant’s current residence or place of business; and

(b) cannot ascertain an alternative place or an alternative method under paragraph (4)(b).”

1. THE CASE LAW: “REASON TO BELIEVE”

in Wards Solicitors v Hendawi [2018] EWHC 1907 (Ch) HHJ Paul Matthews (sitting as a judge of the High Court) considered the issue of whether a claimant had “reason to believe” that a defendant did not live at the address for service.  The case concerns a previous version of the rules. However the judge also made observations about whether the claimant had “reason to believe” the defendant was not at the address.

1. However, there is a further issue to be considered. Service on the defendant was to be effected by post. At that date the then CPR rule 6.5 (4), (6) permitted (as CPR rule 6.9 (2) now permits) service on an individual being sued as such by post at his “usual or last known residence”.The current sub rule (r 6.9(2)) is made subject to sub-rules (3)-(6) of rule 6.9. Sub rule (3) provides that, where a claimant has “reason to believe” that the last known residence is an address at which the defendant no longer resides, he must take reasonable steps to ascertain the defendant’s current residence. At the hearing I heard argument on whether the claimant in this case had such “reason to believe”. In order to answer this question, it would be necessary to consider the events that took place nearly one year earlier, shortly after the mistaken payment and the partial repayment, and which I have already set out (see [8]-[9] above). But of course the version of the rule that needed to be considered was that in force in 2006. I was supplied at the hearing with a copy of the original 1998 version of rule 6.5. Since the hearing I have checked for the exact form of the rule in force in 2006. It is not materially different from the 1998 version, though very different from the version currently in force, introduced largely in 2008.The version in force in 2006 does not contain any equivalent to the current r 6.9(3)-(6). There is therefore no need to consider whether the claimant had such “reason to believe”.

2. If it had been necessary to decide the question, I would have held as follows. The position in February 2006 was that the claimant was told by the defendant by email on 6 February 2006 that the defendant did not receive the letter of 16 January 2006. The claimant knew that the letter had not been returned undelivered. The defendant could have explained, but did not, that the reason he did not receive it was that he had moved away. In my judgment, this would not amount to “reason to believe” on the part of the claimant that the last known residence is an address at which the defendant no longer resides. What had happened was potentially explicable on that basis, but was also explicable on the simpler basis that the letter of 16 January had been mis-delivered by the post office. At best, it amounted to a matter which might be further investigated. Unfortunately, the claimant did not do so.

2. REMEMBER: IT CAN NEVER BE THE “LAST KNOWN ADDRESS” IF THE DEFENDANT HAS NEVER LIVED THERE

the Court of Appeal held that:

1. The phrase “last known residence” could not be extended to an address at which the individual to be served has never resided.
2. When considering an address at which the individual to be served did actually live at some time the court is not concerned with “belief” but with knowledge:

“The draftsman of the rules deliberately chose the word “known”. In our view, knowledge, in this context refers to the serving party’s actual knowledge or what might be called his constructive knowledge, i.e. knowledge which he could have acquired exercising reasonable diligence.”

3. IT IS MANDATORY TO GO THROUGH THE STEPS IN CPR 6.9(4) AND (5)

HHJ Richard Roberts in Sajid -v- Nuur (Central London County court 30/7/18).  A former landlord issued separate proceedings against a former tenant claiming arrears of rent.  Proceedings were served at the property that the tenant rented from the landlord, by then the landlord knew that the tenant had left the propert

The District Judge had found that the claim form had been properly served.  The Circuit Judge held it had not: CPR 6.9 (4) applied and the claimant landlord could have made an application to serve at an alternative address or by an alternative method.

• The landlord had reason to believe  (indeed knew) that the tenant no longer resided at her last-known address.
• The landlord had taken reasonable steps and was unable to ascertain the address of the tenant’s current residence.

Therefore it was mandatory for the landlord to consider whether there was an alternative place or method of service.

4. IF YOU FIND THE DEFENDANT AND/OR ANOTHER ADDRESS

Make an application under CPR 6.15 (which allows service of the claim form by an alternative method or at an alternative place).

5. IF YOU CANNOT FIND THE DEFENDANT

Then you can serve at the last known address. However a claimant remains vulnerable if they cannot show that they have taken “reasonable steps” to find the defendant or an alternative address for service.  The notes in the White Book describe this requirement (or perhaps the drafting) as “ugly” and note that the provisions could be harsh, emphasising the importance of taking the steps outlined in (4) and (5).