Dory Acquisitions Designated Activity Company v Frangos (Rev 1)

A defective attempt to serve originating process may be remedied under CPR rule 3.10 where it constitutes an attempted procedural step, the defendant knew of the proceedings and claim, and the defect caused no prejudice. The court should consider whether the defect was procedural, whether the defendant was effectively informed, the prejudice caused, and any fault by the applicant.

Permission for summary judgment may be given before acknowledgment of service or a defence where the defendant has long known of the claim and has taken no substantive step. Summary judgment is appropriate where there is no realistic prospect of success and no compelling reason for trial.

Dory Acquisitions sought judgment against the defendant under a personal guarantee and indemnity relating to a loan. Three applications were made: an order validating service of an unsealed claim form without a claim number; permission to seek summary judgment before acknowledgment of service or defence; and summary judgment for the unpaid principal and interest.

The defendant had received the claim documents and response pack through his solicitors, corresponded about the claim, but later disputed service and jurisdiction. He filed no acknowledgment of service, jurisdiction challenge, defence or evidence, and did not attend the hearing. The central issues were whether CPR rule 3.10 could cure the defective service and whether the guarantee claim satisfied the summary judgment test.

1. The court proceeded in the defendant’s absence because proper notice of the hearing had been given and it was appropriate to do so under CPR rule 23.11(1).

2. Service of an unsealed claim form without a claim number was invalid under the ordinary service rules. It was nevertheless an error in taking a procedural step, rather than a complete failure of service. CPR rule 3.10 is a beneficial provision capable of applying to originating process and should be given wide effect where appropriate.

3. The relevant considerations included whether there had been an attempted procedural step, whether the defendant knew that proceedings had been issued and understood the claim, whether the defect caused prejudice, and whether the claimant was at fault. The defendant had received the claim and response pack, could readily have checked the electronic court file or requested the claim number, and had conducted correspondence as though the claim were extant. No prejudice was established. The court therefore treated service as valid under CPR rule 3.10(b).

4. Permission to apply for summary judgment was granted under CPR rule 24.4. The defendant had long known the substance of the claim and had taken no step to acknowledge service, challenge jurisdiction or defend the merits.

5. Under CPR rule 24.2, summary judgment was appropriate because the defendant had no realistic prospect of successfully defending the principal debt claim and there was no compelling reason for trial. The borrowers had defaulted, the loan had been accelerated, and the guarantee made the relevant sums payable by the defendant as primary obligor. The defendant’s unparticularised banking-licence argument under section 7 of the Irish Central Banking Act 1971 was without substance. His proposed jurisdiction challenge was also hopeless in light of the express jurisdiction clause.

6. Summary judgment was entered for US$154,095,471.50 plus contractual interest, producing a total of US$156,802,126.78. The claim for expenses was adjourned because the evidence did not establish the amount or contractual basis. The claimant was awarded its costs of the applications.

First-instance decision. No prior appellate decision is stated in the judgment.