Motorola Solutions, Inc & Anor v Hytera Communications Corportation Ltd & Ors

Solicitors’ authority to accept service is determined objectively from the correspondence and its commercial context. A confirmation that solicitors are instructed to accept service of proceedings generally is not confined to proceedings already issued where the wording is broad and the later proceedings were within the parties’ contemplation. A declaratory order concerning valid service cannot be made conditional on payment of an earlier costs order. The court may have an inherent power to stay or restrict participation in proceedings for non-compliance with its orders, but that power should not ordinarily be exercised without a formal application and a fair opportunity to address the relevant evidence and arguments.

Motorola applied for a declaration that its claim form, seeking enforcement of an Illinois judgment against Hytera, had been validly served on Hytera under CPR 6.7(1)(b) by service at Hytera’s solicitors’ London offices. The application arose from correspondence exchanged in March 2020 during earlier freezing-order proceedings connected with the Illinois judgment. Hytera contended that its solicitors had agreed to accept service only in relation to those freezing-order proceedings.

Hytera also relied on Motorola’s non-payment of costs ordered in earlier proceedings and sought, in substance, a conditional declaration, a stay, or eventual strike-out. The central issues were the scope of the solicitors’ agreement to accept service and whether the court should address non-payment of costs without a formal stay application.

1. Declaration granted. The court held that Steptoe & Johnson had agreed to accept service in England and Wales on behalf of Hytera generally. The wording of the 16 March 2020 request referred to “any related matters in England and Wales” and included acceptance of service of English court proceedings. The response of 24 March confirmed authority to accept service without restricting it to the freezing-order proceedings.
2. The correspondence was to be construed objectively, in accordance with the ordinary principles applicable to commercial agreements. [2017] AC 1173 was referred to as a leading statement of that approach. The court considered Firstdale Limited v Quinton [2005] 1 All ER 639, including its emphasis on defining the document and claim by their essential characteristics. That principle did not require the restrictive result argued for by Hytera. In the context of section 25 proceedings, underlying enforcement proceedings were inherently contemplated.
3. The declaration could not properly be made conditional on payment of the Court of Appeal’s costs order. The declaration was a freestanding determination of whether service was valid; conditionality concerned what Motorola should thereafter be permitted to do, rather than the validity of service itself.
4. The court declined to impose a stay without a formal application. It took into account the observations in Days Healthcare UK Limited v Pihsiang Machinery Manufacturing Company Limited [2006] EWHC 144 (QB), which referred to a robust approach to non-compliance with costs orders, and in Hammond Suddard Solicitors v Agrichem International Holdings Limited [2001] EWCA Civ 2065 and Crystal Decisions (UK) Limited v Vedatech [2006] EWHC 3500 (Ch). Those observations did not justify determining an unmade stay application without evidence addressing matters including possible legal or equitable set-off.
5. The existing jurisdictional challenge was expected to fall away. Hytera could, if so advised, issue a formal stay application based on non-payment of the costs orders, to be listed in place of the jurisdictional challenge.