Gary Kenneth Morby v (1) Gate Gourmet Luxembourg Iv Sarl (2) Specialist Airport Services Limited

Personal service of a bankruptcy petition requires delivery to the debtor or, where he refuses it, notice of its contents and leaving it with or near him. The test is not stricter merely because bankruptcy has serious consequences. Knowledge may be inferred from prior dealings and conduct. A petition handed to a third person at the debtor’s request may be left with or near him where he has a sufficient opportunity to take possession or exercise control over it. Rule 7.55 of the Insolvency Rules 1986 does not ordinarily cure a factual failure of personal service, although it may cure an irregularity causing no substantial injustice.

The appeal was brought from the bankruptcy order made by Mr Registrar Briggs on 7 May 2015 following a petition by the respondents. The appellant challenged the order principally on the ground that the bankruptcy petition had not been personally served under rule 6.14 of the Insolvency Rules 1986. At a meeting at Heathrow, the process server handed the petition to a person accompanying the appellant, who inspected it and placed it in a bin. The appellant also challenged the alternative reliance on rule 7.55 to cure any defect or irregularity. The central issues were whether personal service had occurred and, if not, whether the defect could be cured.

1. Appeal dismissed. The Registrar’s bankruptcy order was upheld.
2. Personal service under rule 6.14(1) of the Insolvency Rules 1986 is governed by the two-limbed test stated in Kenneth Allison Ltd v AE Limehouse & Co [1992] 2 AC 105: the document must be handed to the intended recipient, or, if he will not accept it, he must be told what it contains and it must be left with or near him. There was no basis for applying a stricter test to bankruptcy petitions.
3. The appellant knew that the document was a bankruptcy petition requiring his attention. The requirement concerning its contents was therefore satisfied. The petition was left with or near him because it was handed to his companion at his request, and the appellant had a sufficient opportunity to take possession of it or exercise dominion over it.
4. The appellate court was entitled to draw its own conclusions from the written evidence because the Registrar had proceeded on assumed facts equally available to both courts. The Registrar’s additional findings were common-sense inferences from the appellant’s evidence.
5. Rule 7.55 applies only to a formal defect or irregularity. A failure to satisfy the personal-service test is ordinarily a failure of fact, not an irregularity capable of cure. If handing the petition to the companion were an irregularity, it caused no substantial injustice and could properly be cured.

• High Court (Chancery Division): On appeal from the bankruptcy order made by Mr Registrar Briggs on 7 May 2015, the appeal was dismissed and the order upheld.