Bethell Construction Ltd & Anor v Deloitte & Touche

Where parties agree an extension of time for serving a claim form, the court will ordinarily hold them to that agreement. Service of particulars of claim alone does not impliedly serve a claim form previously delivered expressly not by way of service. Nor will the court ordinarily use CPR 6.15 or CPR 6.16 to rewrite that agreement where there has been complete non-service rather than an ineffective attempt at service. The reasonable-recipient test applies objectively to correspondence determining an extension of time. A solicitor’s subjective misunderstanding does not alter the effect of clear correspondence read in its factual context.

The claimants issued a protective claim form in 2007 in a professional negligence claim against their auditors. The claim form was delivered to the defendant’s solicitors expressly not by way of service. The parties agreed extensions of time for service of both the claim form and particulars of claim.

In October 2010 the claimants served particulars of claim but not the claim form. The defendant then gave 14 days’ notice determining the extension agreement. The claimants applied for the claim form to be treated as served, alternatively for retrospective authorisation or dispensation of service. The defendant sought a declaration that the court had no jurisdiction because service was out of time.

1. Service and contractual extension. The claim form had never been served. The parties’ agreement concerned service of both the claim form and particulars of claim. The October 2010 letter, which referred only to particulars of claim, did not abrogate that agreement or create an estoppel.
2. Objective construction. Applying the reasonable-recipient approach in Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] AC 749, the defendant’s letter of 22 October 2010 objectively gave notice determining the extension of time for service of the claim form. The reference to determining the “stay” was understood in the context of the parties’ only relevant agreement. The claim form therefore had to be served within 14 days of receipt, but was not.
3. Retrospective service. The cases concerning ineffective or defective service, including Olafsson v Gissurarson (No 2) [2008] EWCA Civ 152 and Brooks v AH Brooks and Co (a firm) [2010] EWHC 2720 (Ch), were distinguishable. This was a case of complete non-service. Authorising alternative service under CPR 6.15 would undermine the parties’ contractual autonomy and the basis of their agreed extension.
4. Dispensing with service. The exceptional-circumstances power in CPR 6.16 was unavailable. The claim form had been delivered expressly not by way of service, unlike the exceptional circumstances in Olafsson.
5. The claim was statute barred and the court had no jurisdiction to hear it. The defendant’s application was granted. For costs, the court exercised its discretion under CPR 44.3 so that litigation costs ran from 19 September 2007, after the pre-action protocol stage had effectively ended.

First-instance decision. The judgment does not state any prior appellate decision.