AELF MSN 242, LLC v DE SURINAAMSE LUCHTVAART MAATSCHAPPIJ N.V. D.B.A. SURINAM AIRWAYS

A defendant wishing to challenge jurisdiction must first file an acknowledgment of service complying with CPR Part 10. Where that requirement is not met, an extension of time requires relief from sanctions under CPR rule 3.9.

Relief should generally be granted where the default is insignificant and forgivable, assessed through the three-stage inquiry in Denton v TH White Ltd.[2014] EWCA Civ 906

A defendant submits to jurisdiction by conduct which, viewed objectively, is unequivocally inconsistent with maintaining a jurisdictional challenge. Applying for an extension of time to serve a defence, without reserving the right to challenge jurisdiction, may amount to common-law waiver. Such waiver also constitutes an appearance under section 12(3) of the State Immunity Act 1978.

AELF claimed instalments allegedly due under a settlement agreement with SLM. SLM sought an extension of time to file an acknowledgment of service, relief from sanctions, and permission to challenge the jurisdiction of the English court on the basis of allegedly defective service under section 12(1) of the State Immunity Act 1978.

SLM had first attempted to file an acknowledgment by email, filed a compliant acknowledgment only later, indicated an intention to defend the claim, and applied for an extension of time to serve its defence. It subsequently applied to challenge jurisdiction and stated an intention to contest jurisdiction in a further acknowledgment.

The issues were whether time should be extended and whether SLM had submitted to the jurisdiction, including whether any common-law waiver amounted to an appearance under section 12(3) of the 1978 Act.

1. Extension and relief. SLM’s acknowledgment was late and initially defective because it lacked a physical address for service within the United Kingdom. Nevertheless, the failure was neither serious nor significant. SLM attempted to file within time, filed electronically on the next business day after the failed email filing, and cured the address defect promptly after learning of it.
2. The court applied the three-stage Denton v TH White Ltd inquiry: seriousness and significance of the default, the reason for it, and all the circumstances, including efficient and proportionate litigation and compliance with rules. The failure was insignificant and forgivable. Time was extended to 26 July 2021 and relief from sanctions was granted.
3. Submission to jurisdiction. The governing common-law test is objective. A defendant submits where its conduct can be explained only as recognition that the court has jurisdiction. Conduct which is also explicable as necessary or useful for another purpose is not unequivocal submission. The timing of the conduct and any reservation of rights are important.
4. SLM’s application for an extension of time to serve its defence, combined with its earlier indication that it intended to defend the claim and the absence of any reservation of jurisdictional rights, was inconsistent with maintaining a jurisdictional challenge. The later representation to the Surinam court did not independently amount to submission because it occurred after the jurisdiction challenge and the express reservation in the second acknowledgment.
5. State immunity. Assuming, without deciding, that SLM was entitled to rely on section 12(1) of the State Immunity Act 1978, its common-law waiver was an appearance in the proceedings within section 12(3). Section 12(3) is not confined to statutory submission under CPR rule 11(5); an appearance may arise from any procedural act which disables the defendant from disputing jurisdiction.
6. SLM’s jurisdiction challenge was dismissed. Its acknowledgment of service ceased to have effect, and it was permitted to file a further acknowledgment under CPR rule 11(7).