A CLAIM FORM CASE: ACTION FAILS BECAUSE THE CLAIMANTS’ SOLICITORS FAILED TO NOTICE THAT DEFENDANTS’ SOLICITORS HAD AGREED TO ACCEPT SERVICE

I am grateful to my colleague Sarah Lawrenson for sending me a copy of the decision of Master Clark in Keilaus -v- Houghton [2024] EWHC 2108.  It involves an action failing because the claimants’ solicitor failed to notice that the defendants’ solicitor had stated they would accept service.  Service was, therefore invalid, and the action failed.  The court had little sympathy for the solicitor’s mistake.

“Whether a defendant’s solicitors are instructed to accept service is, self-evidently, a very significant fact in the conduct of litigation. Once the inquiry has been made and answered, reasonable steps would consist of recording or highlighting that fact on the file, so it is readily ascertainable, not leaving it unmarked in correspondence to be reviewed, in this case, when the remaining time for service was running short. If that had been done, the error would not have been made”

WEBINAR ON SERVICE AND CLAIM FORM ISSUES IN 2024: 19th NOVEMBER 2024

There is a webinar on the 19th November  2024 reviewing the cases in 2024, it is becoming increasingly difficult to fit this into an hour, but I will try.. Booking details are available here.

This webinar looks at claim form cases in 2024 including:

• Service by the wrong method
• Disputing jurisdiction
• Problems with serving abroad
• Claim failed when the claimant believed claim form would be served by the Court
• When the defendant fails to use the correct rule to dispute jurisdiction
• When can a claim form include multiple parties
• Failing to serve on a nominated solicitor.
• Serving the wrong solicitor.

IN-HOUSE PRESENTATION ON PREVENTING PROBLEMS WITH SERVICE OF THE CLAIM FORM

I have been asked to, and given, several in-house presentations on avoiding problems with service of the claim form.  This is becoming a major issue for many firms.  For details of the presentation, and the costs involved, contact me at g.exall37@btinternet.com.

THE CASE

The claimants issued proceedings under the Inheritance (Provision for Family and Dependants) Act 1975.  Prior to service the claimants’ solicitor asked whether the defendants’ solicitors were instructed to accept service. The defendants’ solicitors said that they would accept service. The claimants’ solicitor overlooked this acceptance and subsequently wrote again asking whether the solicitors would accept service. There was no reply.  The claimants’ solicitor then served on the defendants personally. He sent copies to the defendants’ solicitors by email. None of these were valid service.  The defendant made an application under CPR 11 challenging jurisdiction.  The claimants’ attempts to rectify matters failed.

THE CHRONOLOGY

The judge set out the relevant chronology.

8. The claim form was issued on a protective basis on 29 November 2023. The deadline for taking the step required by CPR 7.5 was therefore 12.00 midnight on the calendar day 4 months after the date of issue of the claim form i.e. by midnight on 28 March 2024.

9. Following issue of the claim form, the claimants sent on 14 December 2023 a letter of claim, and negotiations towards mediation took place.

10. On 13 March 2024, the claimants’ solicitors sought by email and obtained (by email) the defendants’ solicitors’ confirmation that they were instructed to accept service.

11. This was subsequently overlooked by the claimants’ solicitors. 12 days later, on 25 March 2024, they wrote to the defendants’ solicitors:

“Having reviewed our file, we do not see that you have yet expressly confirmed that you are instructed to receive our clients’ service of proceedings. As you will appreciate, this means that we are yet unable to validly serve proceedings upon your client through you.

Given the approaching deadline for service, please confirm that you have been duly instructed at your earliest opportunity and in any event by close of business tomorrow, Tuesday 26 March 2024, failing which we will be serving your clients’ personally.”

12. On 26 March 2024, the defendants’ solicitors replied to another email sent on 25 March 2024, but not to the email asking about service. The same day the claimants’ solicitors emailed:

“Please could you also confirm whether you have been instructed to receive our service of proceedings by your clients? Please provide an answer before the close of business, otherwise we will be serving your clients personally.”
(emphasis as in original)

13. Finally, on 27 March 2024, the claimant’s solicitors emailed:

“The service deadline is tomorrow, can you please confirm if you have instructions to accept service?”

14. The response to this email was an out-of-office email. On 27 March 2024, the claimants’ solicitors served the claim form (and supporting evidence) on the defendants personally, and also sent those documents (by email) to the defendants’ solicitors under cover of a letter stating:

“We write further to previous correspondence in this matter, having noting (sic) you have failed to confirm you were instructed to accept service of proceedings in this matter.

As such, we have effected service of proceedings upon your clients personally today.
As a courtesy, we enclose the copy letters and enclosures sent directly to your clients for your records.”

15. On 28 March 2024 the deadline for service expired. Notwithstanding this the parties continued negotiating as to the date for mediation, which was ultimately agreed for 2 July 2024. On 12 April 2024, the defendants filed acknowledgements of service contesting jurisdiction, and copied the claimants’ solicitors in by email.”

THE CLAIMANTS’ FAILURE TO SERVE PROPERLY

The claimant had served on the defendants personally in circumstances where the solicitors had stated that they would accept service. This meant that service was invalid. In addition the documents sent to the defendants’ solicitors were by email.  In the absence of prior consent this was not a valid means of service.

ACCEPTED LEGAL PRINCIPLES

“Legal principles
16. The following were common ground:
(1) Service on a defendant personally where their solicitors have confirmed that they are instructed to accept service is not valid service: see CPR 6.7 and Nanglegan v Royal Free [2001] EWCA Civ 127, [2002] 1 W.L.R. 1043;
(2) in the absence of express agreement to accept service by email, it is not a valid method of service: CPR PD 6A, para 4.1.”

THE CLAIMANTS’ APPLICATION TO ALLOW “SERVICE BY AN ALTERNATIVE METHOD” – CPR 6.15

Service by an alternative method

1. CPR 6.15 provides:

“(1)   Where it appears to the court that there is a good reason to authorise service by a method or at a place not otherwise permitted by this Part, the court may make an order permitting service by an alternative method or at an alternative place.

(2)     On an application under this rule, the court may order that steps already taken to bring the claim form to the attention of the defendant by an alternative method or at an alternative place is good service.”

2. The principles applicable to applications under CPR 6.15 are conveniently summarised by Carr LJ (as she was) in (on the application of the Good Law Project) v Secretary of State for Health and Social Care [2022] EWCA Civ 355, [2022] 1 W.L.R. 2339 at [55]:

“i)     The test is whether in all the circumstances, there is good reason to order that steps taken to bring the claim form to the attention of the defendant are good service;

6. ii) Service has a number of purposes, but the most important is to ensure that the contents of the document are brought to the attention of the person to be served. This is a critical factor. But the mere fact that the defendant knew of the existence and content of the claim form cannot, without more, constitute a good reason to make an order under CPR 6.15(2) ;

iii)     The manner in which service is effected is also important. A “bright line” is necessary to determine the precise point at which time runs for subsequent procedural steps. Service of the claim form within its period of validity may have significant implications for the operation of any relevant limitation period. It is important that there should be a finite limit on the extension of the limitation period;

1. iv) In the generality of cases, the main relevant factors are likely to be:
2. a) Whether the claimant has taken reasonable steps to effect service in accordance with the rules;
3. b) Whether the defendant or his solicitor was aware of the contents of the claim form at the time when it expired;
4. c) What, if any, prejudice the defendant would suffer by the retrospective validation of a non-compliant service of the claim form.

None of these factors are decisive in themselves, and the weight to be attached to them will vary with all the circumstances.”

3. As Carr LJ observed,

“The power in CPR 6.15 can be (and is) often used to assist claimants where there are difficulties in service, for example, because a defendant is being evasive or abroad and difficult to locate, or because service through diplomatic channels proves impossible to achieve in time. The courts are often invited (prospectively) and agree to authorise alternative methods or places in such circumstances.”

EXTENDING TIME

Extending time for service pursuant to CPR 7.6(3)

20. CPR 7.6(3) provides, so far as relevant:

“If the claimant applies for an order to extend the time for compliance after the end of the period specified by rule 7.5 or by an order made under this rule, the court may make such an order only if –
…
(b) the claimant has taken all reasonable steps to comply with rule 7.5 but has been unable to do so; and
(c) … the claimant has acted promptly in making the application.”

21. “Reasonable steps” is to be considered in the following context:
(1) Provided he 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 claim form: see Sodastream Ltd v Coates [2009] EWHC 1936 (Ch) at [50(9)]
(2) In particular, there is no duty on a defendant to warn a claimant that valid service of a claim form has not been effected (see Barton v Wright Hassall LLP [2018] UKSC 12; [2018] 1 WLR 1119 at [22] and Woodward v Phoenix Healthcare Distribution Ltd [2019] EWCA Civ 985 at [48].
(See the Good Law Project) at [57])

THE DECISION IN THE CURRENT CASE

Issues
22. In this framework, the issues arising were:
(1) whether there was “good reason” to (retrospectively) authorise service of the claim form by
(i) sending it directly to the defendants; or
(ii) sending it by email to the solicitors.
(2) whether the claimants had taken all reasonable steps to serve the claim form in time and been unable to do so.

Discussion and conclusions
23. The claimants’ counsel relied upon the same factual matters in relation to both issues. He submitted that although the claimants’ solicitors had made an error, that error should not be considered in isolation, but in the context of their repeated requests to the defendants’ solicitors as to whether they were instructed to accept service. He relied upon the fact that the defendants’ solicitors saw the mistake, responded to email correspondence on another topic, but did not correct the error.

24. He accepted, correctly, that the defendants’ solicitors were under no duty to point out the error. He submitted, however, that the error was one of inadvertent oversight, not incompetence. It would, he submitted, be unfair and unjust for the defendants to take advantage of the oversight when they were on notice that it had taken place, and had ignored the repeated emails that made it clear that the mistake had been made. This was, he submitted a “good reason” within CPR 6.15 to authorise service by the methods used, or, alternatively, a ground for concluding that the claimants had taken all reasonable steps to serve the claim form.

25. I do not accept this characterisation. Whether a defendant’s solicitors are instructed to accept service is, self-evidently, a very significant fact in the conduct of litigation. Once the inquiry has been made and answered, reasonable steps would consist of recording or highlighting that fact on the file, so it is readily ascertainable, not leaving it unmarked in correspondence to be reviewed, in this case, when the remaining time for service was running short. If that had been done, the error would not have been made. The fact that it was not done led to what I consider to be the avoidable error by the claimants’ solicitor in reviewing the file. This means that, in my judgment, the claimants cannot show that there is good reason to authorise service by an alternative method; or that they took all reasonable steps to serve the claim form within the period of its validity, or that they were unable to do so. They were in my judgment plainly able to do so.

26. For the reasons set out above, therefore, I dismiss the claimants’ application. As to the consequences of doing so, the analysis in Aktas v Adepta [2011] QB 894 (at [19]-[21]) shows that the effect of failing to serve a claim form within the prescribed 4 month period is “not that the claim automatically lapses, but rather that it remains ‘in limbo’ and thus requires to be given a formal quietus – either by serving a notice of discontinuance or, if the relevant claimant fails to take this step (and to accept the usual costs consequences), by an order of the court to ‘set aside’ the claim [form]”: see Jerrard v Blyth [2014] EWHC 647 (QB) at [16].