FARRER & CO LLP v JULIE MARIE MEYER

Service on a company director under section 1140 of the Companies Act 2006 may validly serve proceedings on the individual at the company address, including where default judgment is sought. The provision is not confined to particular causes of action or purposes.

An application to set aside default judgment must be made promptly. Delay, weak merits and continuing non-compliance with court orders may justify refusing discretionary relief. Relief from sanctions under CPR rule 3.9 does not apply to breach of a mandatory order endorsed with a penal notice. The appropriate remedy is variation or discharge of the order, or compliance. The court may impose a suspended committal order under CPR rule 71.8 where the statutory and procedural conditions are met.

The claimant, a firm of solicitors, obtained default judgment for unpaid fees after serving the claim at London addresses registered for companies associated with the defendant. The defendant later applied to set aside the judgment, alleging invalid service and a possible defence concerning the quality and amount of the claimant’s work.

The defendant had also failed to comply with an order requiring disclosure of financial documents following a judgment-debtor examination. She sought an extension of time, relief from sanctions and, in substance, discharge of the disclosure obligation, relying on illness and alleged Swiss criminal-law restrictions.

The court had to determine whether the default judgment was irregular or should be set aside, whether relief or an extension should be granted, and whether the defendant should be held in contempt and made subject to a suspended custodial sentence.

1. Default judgment. The judgment was regular. Section 1140 of the Companies Act 2006 authorised service on the defendant individually at the company address. The reasoning in PJSE Bank “Finance and Credit” v Zhevago [2021] EWHC 2522 (Ch) applied directly. There was no restriction preventing use of that mode of service for a debt claim or for obtaining default judgment.
2. The defendant was bound by counsel’s earlier concession that the judgment was regular. In any event, the judgment should not be set aside under the discretionary power. The application was delayed first before, and then for nearly two years after, it was made. The proposed defence was partial and weak. The bills could be supplemented by information already known to the defendant, applying Ralph Hume Garry (a Firm) v Gwillim [2003] 1 WLR 510. Assessment under section 70 of the Solicitors Act 1974 was out of time.
3. Disclosure order. CPR rule 3.9 did not apply. The defendant had not missed a procedural deadline but remained in breach of a mandatory order carrying a penal notice. There had been no meaningful attempt to comply and no application to vary or discharge the order.
4. Alleged Swiss criminal-law consequences did not excuse non-compliance. The court applied the balancing approach identified in Bank Mellat v HM Treasury [2019] EWCA Civ 449 and Tugushev v Orlov [2021] EWHC 1514 (Comm). The evidence was generic, did not address all documents, did not analyse the documents against Swiss law and did not demonstrate any real risk of prosecution.
5. Contempt. The court had jurisdiction under CPR rule 71.8. The original order to attend was made under rule 71.2, the service requirements were satisfied, and the claimant’s obligations under rules 71.4 and 71.5 had been met. The defendant was held in contempt. A six-month sentence of imprisonment was imposed and suspended on terms requiring full disclosure by 4pm on 7 February 2022 and personal attendance at court on 14 February 2022.