Naftiran Intertrade Company (NICO) Limited & Anor v GL Greenland Limited & Anor

For an in-time application to extend the validity of a claim form, the conditions in CPR 7.6(3) do not apply. The court must evaluate why service was not completed, then consider the overriding objective and the balance of hardship.

Pre-service investigation may amount to a good reason where proceedings are complex and the claimant is assessing the defendants’ status, assets, jurisdiction and viable causes of action. Mere time required to finalise particulars is ordinarily insufficient, but substantial work deciding which claims to advance and against whom may justify an extension.

A possible limitation defence is an important consideration, but is not determinative. The court may assess its likely strength without finally deciding limitation.

NICO brought claims concerning unpaid crude-oil invoices and related trust or charge allegations against a Cypriot company and an individual resident in Switzerland. In Claim 1, issued in October 2020, NICO obtained successive without-notice extensions of time for service of the claim form. The defendants applied under CPR 11 and/or CPR 23.10 to set aside those orders, principally arguing that the first two extensions should not have been granted and that later orders consequently fell away.

The central issues were whether NICO had a sufficient reason for not serving the claim form during the initial period and first extension, whether the possible limitation defence materially affected the discretionary exercise, and whether there had been material non-disclosure in obtaining later extensions.

1. Application dismissed. The extensions of time for service of the claim form in Claim 1 remained effective.
2. Under CPR 7.6(2), an in-time application is governed by the overriding objective. The threshold conditions in CPR 7.6(3) do not apply. The court must evaluate the reason for non-service and place it in the wider context of justice and the balance of hardship. The better the reason, the more likely an extension will be granted, although the absence of a good reason does not remove the discretion.
3. NICO had sufficiently good reasons for non-service. The proceedings were reasonably complex, involved multiple jurisdictions, and required investigation of the defendants’ status, asset position, jurisdictional basis and the causes of action properly to be advanced. The investigation was not limited to finalising particulars. It involved deciding which substantial claims should be brought against which defendants.
4. The court distinguished the general point in Sodastream v Coates [2009] EWHC 1936 (Ch) that time needed merely to finalise particulars is not generally a good reason. Here, the work involved materially formulating and refining the claims and jurisdictional case.
5. Limitation was important but not determinative. The January 2016 minutes referred generically to Ferland’s unpaid debts and did not distinguish between invoices. On the material before the court, any limitation defence to Invoice 4 was speculative and appeared weak. The court did not finally determine limitation, but was entitled to give the possible defence little weight in the extension application.
6. The later orders were not independently undermined. There was no material breach of the duty of full and frank disclosure. Claim 1 and Claim 2 could in principle both proceed and were directed to be heard together, with common case-management arrangements.

First-instance decision. The judgment refers to earlier case-management and service orders, including decisions of HHJ Pelling KC and Deputy Judge Dias KC, but no appeal is described.