Phillips and Another (suing as administrators of the estate of Christo Michailidis) V Symes and Others

An English court may use its procedural powers to treat defective service as effective where proceedings were delivered through the prescribed foreign-service process but an official mistakenly omitted the claim form. An order dispensing with service may, if necessary, validate service from the date on which equivalent documents were delivered.

Where that determination affects priority under article 21 of the Lugano Convention 1988, the discretion must be exercised sparingly and only in exceptional circumstances. It was properly exercised where the defendants received a translation of the claim form and detailed particulars, suffered no prejudice and sought to exploit an error by the foreign authorities. The English court was therefore first seised on the effective date of service.

The administrators of an estate claimed the unpaid US$3 million price of an antiquity from a Swiss company and its proprietor. The English claim form was issued on 16 December 2004. Documents were transmitted for service in Switzerland under the Hague Convention, but a Swiss official removed the English claim form from the package before delivering the remaining documents on 19 January 2005. The package nevertheless contained a German translation of the claim form and detailed particulars of claim.

The respondents began negative-declaration proceedings in Switzerland on 3 February 2005. Peter Smith J held that service could be dispensed with and that the English court had become seised on 19 January 2005: [2005] EWHC 1880 (Ch). The Court of Appeal reversed that decision and stayed the English proceedings: [2006] EWCA Civ 654; [2006] 1 WLR 2598. The issue was whether the English court was first seised for article 21 of the Lugano Convention 1988.

1. Appeal allowed unanimously. Lord Brown delivered the leading opinion, with which Lord Bingham, Lord Rodger and Baroness Hale agreed. Lord Mance agreed that effective service had occurred on 19 January 2005. The English court was therefore first seised under article 21 of the Lugano Convention 1988.

2. Per Lord Brown, CPR 3.10 was capable of treating the attempted service as valid. The procedural error was the omission of the English-language claim form from a package otherwise served through the prescribed Hague Convention machinery. That omission did not necessarily invalidate the procedural step of serving the proceedings. The reasoning in The Goldean Mariner showed that a beneficial procedural-curing provision could apply even to serious defects in service.

3. Per Lord Brown, if CPR 6.9 was also required, the court could dispense with service of the omitted claim form. The judge's order recognised that the service already effected was sufficient; it did not necessarily operate as retrospective validation. Even if retrospective validation was involved, English procedural law permitted it. The domestic court determines when its proceedings become definitively pending for the Convention, and effective service occurs on whatever date the domestic court ultimately declares it to have occurred.

4. Per Lord Brown, a power affecting international priority must be exercised sparingly and only in the most exceptional circumstances. Ordinarily, it could not properly be exercised where no process of service had occurred. Here the respondents received both the German translation of the claim form and detailed particulars in English and German. Those were equivalent documents for the purposes of article 27(2). The respondents suffered no prejudice, while the material errors were committed by the Swiss authorities and were then used to obtain a procedural advantage.

5. Baroness Hale and Lord Mance additionally considered that the English court had been seised earlier, either when the claim form was issued or when the freezing order was made. Lord Mance would have reconsidered the service rule in Dresser and The Sargasso. That broader reasoning was unnecessary to the decision and did not command a majority.

6. The Court of Appeal's judgment was set aside and the material parts of Peter Smith J's order were restored. Costs in the House were adjourned for written submissions.

1. House of Lords: The appeal was allowed unanimously. The judgment of the Court of Appeal was set aside and the material parts of the first-instance order were restored: [2008] UKHL 1 .
2. Court of Appeal: The respondents' appeal was allowed, the first-instance order and consequential service were set aside, and the English proceedings were stayed under article 21 of the Lugano Convention 1988: [2006] EWCA Civ 654 ; [2006] 1 WLR 2598 .
3. High Court: Peter Smith J dispensed with service of the claim form and declared that the High Court had become seised against the respondents on 19 January 2005: [2005] EWHC 1880 (Ch) .