Capital Alternatives Sales and Marketing Ltd v Nabas & Ors

The court considered whether the claim form had been validly served on the first defendant and, alternatively, whether retrospective relief should be granted under CPR r.6.15 or r.6.16 or relief under CPR rr.3.9/3.10. The Companies Act 2006 s.1140 (registered address) and CPR Part 6 service rules (notably r.6.8, r.6.3, r.6.15 and r.6.16) were central.

The judge held that objectively the documents left by the claimant's courier on 19 June 2018 were addressed to the second and third defendants and not to the first defendant; Unit 44, although a registered address for the first defendant for the purposes of s.1140, had not been shown to have been given by the first defendant as an address for service under CPR r.6.8. There was therefore no good service on the first defendant.

The court refused retrospective validation under CPR r.6.15 because the claimant had not taken reasonable steps to effect service within the rules, the events of 19 June did not establish sufficient objective steps by the claimant to bring the claim form to the first defendant's attention, and the balancing exercise (including the risk of prejudice by loss of limitation defences) did not favour validation. The court likewise refused to dispense entirely with service under the higher threshold of CPR r.6.16 and refused relief under CPR rr.3.9/3.10. The claimant's application was dismissed and the claim against the first defendant could not continue.

This was a first instance hearing of competing interlocutory applications. The claimants sought, by amended application, declarations and retrospective relief concerning service of the claim form and particulars on the first defendant and, alternatively, orders dispensing with service or extending time; the first defendant applied for a declaration that the court lacked (or would not exercise) jurisdiction and that purported service should be set aside.

Background and parties:

• The claimants are two companies in liquidation and their liquidator. The dispute arises from alleged defective legal services in relation to disposals of development plots by a Brazilian subsidiary, with losses alleged of £14.7m. The first defendant is a Brazilian national and registered foreign lawyer; the second defendant was her former practice; the third defendant was said to be the successor practice.
• The claim form was issued on 20 February 2018. The claimants arranged for three identical service packs to be left by courier on 19 June 2018: one at Unit 44 (the second defendant's registered office) and two at Plough Place (the third defendant's registered office). None of the packets left at that time were addressed to the first defendant. A separate letter addressed to the first defendant was prepared but not sent.
• The first defendant accepted she first saw the claim form on or about 7 June 2018 (a copy had been sent under cover of a letter stating it was for information only), and she filed an acknowledgement of service contesting jurisdiction.

Nature of relief sought:

• Declarations that the first defendant had been validly served at Unit 44 (a registered address), retrospective permission under CPR r.6.15 to treat service at Unit 44 or Plough Place as good service, an order under CPR r.6.16 dispensing with service in exceptional circumstances, extension of time or relief from sanction under CPR rr.3.9/3.10 (variously pleaded and amended).

Issues framed by the court:

• Whether, assessed objectively, a claim form was left for the first defendant on 19 June;
• whether Unit 44, shown as a registered address at Companies House, amounted to an address given by the first defendant for service under CPR r.6.8;
• whether there was good reason under CPR r.6.15 to validate non-compliant service or whether exceptional circumstances under CPR r.6.16 warranted dispensing with service;
• whether relief could be granted under CPR rr.3.9 or 3.10 to cure procedural defects.

Court’s reasoning and subsidiary findings:

• The court accepted section 1140 of the Companies Act 2006 may operate as a parallel code enabling service at a registered address, but found no evidence that registration of Unit 44 as the first defendant's address arose from an act by the first defendant that would satisfy CPR r.6.8's criterion that the defendant has "given" that address for service. The registration obligations appeared directed at the company rather than an individual director.
• Objectively the single pack left at Unit 44 was for the second defendant (letter addressed to second defendant and claim form Address Box naming the third defendant). The two packs left at Plough Place were addressed to the third defendant and the claim forms in those packs named the third defendant in the Address Box; the court rejected the claimant's contention that transit by the defendants among their offices converted those deliveries into service on the first defendant.
• The court applied the objective test for service (citing Asia Pacific), rejected reliance on the copy sent under cover of the 7 June letter as service (it had been expressly stated to be "for information only"), and concluded there was no step taken by the claimants on 19 June to effect service on the first defendant.
• On CPR r.6.15, applying Barton and Abela principles, the court found the claimants had not taken reasonable steps to effect service, had not investigated public registers, had left it late in the claim form period, and had not shown sufficient good reason to validate service made on co-defendants as service on the first defendant. The "windfall" argument was rejected: any potential loss of limitation defence for the first defendant would flow from the claimants' own failures, not from the defendant's conduct.
• The higher threshold for CPR r.6.16 (dispensing with service in exceptional circumstances) was not satisfied for similar reasons. Relief under CPR rr.3.9/3.10 was not available to avoid the specific restrictions of Part 6 in this context.

Outcome: The claimants' application failed, the claim form was not treated as validly served on the first defendant and the claim against her could not continue in those proceedings.

The Claimants' application is dismissed and the claim against the First Defendant cannot continue. The judge found objectively that the documents left by the claimant's courier on 19 June 2018 were addressed to the second and third defendants and not to the first defendant; Unit 44, although a Companies House registered address, had not been shown to have been given by the first defendant as an address for service under CPR r.6.8. There was no good reason to validate service under CPR r.6.15, no exceptional circumstances to dispense with service under CPR r.6.16, and relief under CPR rr.3.9/3.10 was not available to cure the defect.