Kersten & Ors v Purvis

For CPR Part 6.7 to require service on a nominated solicitor, the claimant must have received written notice of the nomination. The rule does not automatically import the deemed-service provisions in CPR Part 6.26. Under CPR Part 6.15(2), validation depends on all the circumstances, including reasonable steps by the claimant, the defendant’s knowledge of the claim form, prejudice, and evasion or technical games concerning service. A default judgment obtained by request in a mixed claim is irregular where the claimant has not abandoned the additional remedy. The court may nevertheless set aside a default judgment under CPR Part 13.3 where the defendant has a real prospect of defending the claim and relief is proportionate.

The claimants sought rescission or damages arising from a share sale agreement and obtained judgment in default for £1,258,535.21 after serving the claim form at the defendant’s home address. The defendant applied to set aside the judgment under CPR Parts 13.2 and 13.3. The claimants cross-applied under CPR Part 6.15(2) to validate service.

The defendant asserted that he had nominated solicitors to accept service under CPR Part 6.7. The court found that the nomination letters had been sent but not received. It considered whether the claim form had been validly served, whether alternative service should be validated, whether the request procedure under CPR Part 12.4 was available for the mixed claim, and whether discretionary relief should be granted.

1. Service under CPR Part 6.7. The defendant’s nomination of solicitors was not received by the claimants. The word “given” in CPR Part 6.7, read in its ordinary meaning, context and purpose, requires receipt. The rule is distinct from rules requiring a document to be served. CPR Part 6.20 does not apply the deeming provisions in rule 6.26 to a nomination which itself is not a document required to be served. The claim form was therefore validly served at the defendant’s address.
2. Validation under CPR Part 6.15(2). If validation had been necessary, there was good reason to validate the steps taken. The claimants had taken reasonable steps to serve in accordance with the rules, were unaware of the nomination, and had served at the address they reasonably understood to be correct. The defendant knew proceedings were imminent and had engaged in conduct amounting to playing technical games with service. The limitation consequences supported relief.
3. Irregular default judgment. The request procedure in CPR Part 12.4(1) was unavailable because the claim included rescission and that remedy had not been abandoned. The request expressly abandoned restitution only. Following Intense Investments Limited v Development Ventures Limited [2005] EWHC 1726 (TCC), the judgment was irregular and had to be set aside as of right. CPR Part 3.10 did not justify overlooking the deliberate use of the wrong procedure.
4. Discretionary relief. The defendant had a real prospect of successfully defending the claim. The default was serious and significant, and the evidence of good reason was unsatisfactory. Applying the third stage of the Denton approach, however, the delay was limited, the application was sufficiently prompt, no trial date had been lost, and it would be disproportionate to prevent the defence of a substantial claim involving allegations of fraud. The default judgment was set aside. No security equivalent to the interim charging order was imposed.