Katherine Playfair & Ors v Pannells LLP (formerly PKF (UK) LLP) & Ors

An extension of time for serving a claim form under Civil Procedure Rules 1998, rule 7.6 requires a claimant to establish a good reason for the inability to serve and, where limitation has expired, to show that reasonable steps were taken during the claim form’s validity. The reason for non-service is the critical inquiry, although it must be assessed in the wider context of the overriding objective and the parties’ hardship.

Uncertainty about the precise claim, its losses or the correct defendants does not generally justify withholding service. A claimant should ordinarily protect its position by serving the claim form, seeking a stay or an extension for particulars, or obtaining a standstill agreement. The discretion is fact-specific and does not permit limitation rights to become elastic through delay.

The claimants issued a claim form alleging professional negligence concerning the restructuring of family trusts in 2008. They alleged that the defendants had misunderstood their beneficial interests and had failed to advise about adverse inheritance tax and capital gains tax consequences.

The claim form was issued within the alleged limitation period but was not served within its four-month validity. The claimants sought a prospective extension under Civil Procedure Rules 1998, rule 7.6, relying on late discovery of the potential claim, the complexity of the tax and trust issues, difficulty identifying the responsible advisers, and delays in changing solicitors and obtaining documents. The central issues were whether there was a good reason for the inability to serve and whether reasonable steps had been taken before expiry.

1. Application dismissed. The claimants had not shown a good reason for failing to serve the claim form and had not taken reasonable steps to serve it during its period of validity. The application to substitute parties therefore did not arise for determination.
2. The governing principles were those summarised in ST v BAI (SA) (trading as Brittany Ferries) [2022] EWCA Civ 1037. A defendant has a right to be sued by originating process issued within the limitation period and served within the claim form’s initial validity. The reason for inability to serve is highly material. Where limitation has expired, reasonable steps to serve are required, and the discretion must be exercised in accordance with the overriding objective.
3. The requirement for reasonable steps does not necessarily concern only the physical mechanics of service. A difficulty in ascertaining whether a viable claim exists, or against whom, may in principle create an inability to serve. It remains necessary to assess objectively whether the claimant acted reasonably in the circumstances.
4. The claimants knew enough to identify the potential defendants and the essential nature of the claim when the claim form was issued. Further work was needed to particularise the claim and quantify losses, but those matters could have been addressed after service. The claimants could have served the claim form and sought a stay or an extension for particulars, sought consent to an extension or stay, or obtained a standstill agreement.
5. The decision in Steele v Mooney [2005] 1 WLR 2819 did not establish a general principle that uncertainty about the viability of a claim justified delaying service. Properly understood, its ratio concerned the scope of rule 3.10, in circumstances where the defendants had been notified and had consented or failed to oppose an extension.
6. The claimants’ delay after instructing new solicitors, the absence of urgency, and the failure to engage with defendants about protecting the claimants’ position meant that reasonable steps had not been taken. The defendants were not responsible for the relevant delay. The potential loss of a valuable claim could not be treated as a simple balance of hardship overriding the importance of timely service.