American Leisure Group Ltd v Garrard & Ors

The four-month period in Civil Procedure Rules 1998, rule 7.5(1), applies where a claim form is served within the jurisdiction. The six-month period in rule 7.5(2) applies only where the claim form is served out of the jurisdiction in accordance with Part 6, section IV. Service within the jurisdiction cannot be brought within rule 7.5(2) merely because an address outside the jurisdiction appears on the claim form. After the service period has expired, an extension under rule 7.6(3) requires all reasonable steps to have been taken and prompt application. Rule 6.15 cannot be used to extend time where the real issue is timing rather than method or place of service.

The claimant brought proceedings against former directors and a consultant in connection with potential liability arising from proceedings in Florida. The first defendant applied for a declaration that service of the claim form and particulars of claim in January 2014 was invalid. The claim form had been issued on 7 August 2013, but no steps had been taken to serve the first defendant within four months.

The claimant argued that the six-month period in CPR 7.5(2) applied because one of the two addresses given for the first defendant was in Switzerland. Alternatively, it sought an extension under CPR 7.6(3) or an order under CPR 6.15(2) validating the steps already taken.

1. Service period. CPR 7.5(1) governs service within the jurisdiction, while CPR 7.5(2) governs service out of the jurisdiction in accordance with section IV of Part 6. The latter provision does not permit service within the jurisdiction during a six-month period merely because the claim form contains an overseas address. CPR 6.40 is likewise concerned exclusively with service out of the jurisdiction. The claim form was therefore not served within the applicable time limit.
2. Extension under CPR 7.6(3). Because the application was made after expiry of the period in CPR 7.5, the claimant had to show that it had taken all reasonable steps to comply with the rule and had acted promptly. It failed the first requirement. The inclusion of both Swiss and London addresses showed uncertainty about the proper place of service, and elementary enquiries would have established that the first defendant lived in London. No attempt had been made to serve him before January 2014. The application was not rejected for lack of promptness, but it could not succeed because CPR 7.6(3)(b) was not satisfied.
3. Alternative service. CPR 6.15 concerns an alternative method or place of service. It does not provide a means of extending time where the method and place were permissible but service occurred too late. It could not therefore validate the January service.
4. The court rejected the suggestion that dismissal would produce an unfair windfall or reward technical games. The claimant had failed to serve the claim form within its validity period, and the first defendant had promptly engaged once notified. Following the observation in Vinos v Marks & Spencer [2001] 3 All ER 784, the claimant’s failure to satisfy rule 7.6(3) meant that the claim was lost, subject to any limitation consequences.
5. The claimant’s application was dismissed. A declaration was made that the purported service on the first defendant in January 2014 was invalid.

Not stated in the judgment.