Serbian Orthodox Church v Kesar & Co [May 2021] and Fisken Ltd v Carl [June 2021] have given us two opposing positions in as few months. Here, we look in detail at both judgments and the importance of knowing the procedure and law surrounding service – something that seems to be catching many solicitors out – and more so perhaps since more electronic based working has been implemented over the last 18 months.
Serbian Orthodox Church v Kesar & Co  EWCH 1205 (QB) – What constitutes valid service?
The case concerns a number of individuals who, via the Respondent, brought a case against the Appellant (for the purposes of these proceedings) for alleged abuse between 1998 and 2014. In 2014, Mater Cook ruled that the court had no jurisdiction to try the claims brought, largely based on a “complete disregard for the Civil Procedure Rules”. The now Respondent, was ordered costs be paid on an indemnity basis – with cause to be shown as to why they should not be subject to wasted costs – this order was made in August 2020. Thereafter, both parties agreed email service of documents; in October 2020, the Appellant provide the N252 and Bill of costs (£222,256.85) to a second, longer email address that the Respondent had used – (the Respondent had arranged for all emails to the longer email address be automatically forwarded to the previously used shorter email address). If service was deemed on that same day, Points of Dispute fell due on 9 November; the Respondent failed to serve any such document and so the Appellant sought a DCC for the sums claimed which was entered on 16 November 2020; the Respondent
subsequently applied to have the DCC order set aside.
In their application to set-aside, the Respondent raised three points for consideration;
- There had been no agreement to accept service by emails, and
- Pursuant to CPR 47.12(2), the Court should apply their discretion because there was “good-reason” to do so – relying on the Denton test
- Valid service had not been effected, as the email address upon which the N252 was sent, was not the pre-agreed email address for accepting email service (this was a new point raised at the hearing by the Respondent)
At the hearing to set-aside the DCC, Senior Master Gordon-Saker determined in respect of the above points;
“i) rejected Kesar’s argument (which was not seriously pursued at the hearing) that there had been no agreement to accept service by email;
ii) accepted Kesar’s argument that sending an email
to the long form email address, which had then
been automatically and instantly forwarded to the
short form email address, did not constitute valid
iii) confirmed that he would not have been satisfied,
had the issue arisen for determination, that Kesar
had shown “good reason” for setting the DCC
It was therefore determined that effective service had not been made and concluded to set-aside the DCC order. The Appellant sought to appeal the decision and seek the court either waive the potential defective service under CPR 3.10 or order valid service had been effected pursuant to CPR 6.27. Foxton J found before him the general issue was as to whether service could be deemed effective when electronically served on an email addresswhich automatically and immediately forwarded the same email to another email address.
Was service effected in compliance with CPR 6.20 and PD 6A
Foxton J reviewed the provisions at CPR 6 in detail and relied upon several cases in summarising the effect of the provisions in place. Paragraph 23 provides a useful summary of the outcome when adopting forms of service and achieving either the intended result as prescribed or adopting a method but not achieving the intended result. Consideration was also given the Rules of the Supreme Court (RSC) in Austin Rover Group Ltd v Crouch Butler Savage Associates where it was held that ““sending” or posting of the letter was not service in itself, but only an element in service (p.1118), there being no delivery unless the letter reaches the address”; Foxton J differentiated this case on the basis that email delivery was “automatic and instantaneous” and there was adequate presumption of delivery. The approach now provided for in the CPR is more “formalistic” and there is greater provision for a Defendant to seek relief in such cases.
Should service be validated under CPR 3.10 or CPR 6.27?
This is the basis of the Claimant’s appeal – that defective service either be waived, or effective service be affirmed
pursuant to CPR 6.27. The Defendant opposed this argument on the basis that the Claimant had not previously raised it at the initial hearing; Foxton J allowed the Claimant’s submission satisfied it met the test set out in Singh v Dass  for raising a new argument. Following review of the provisions, Foxton J turned to a plethora of authorities on the reliance of CPR 3.10. The main authorities being;
- Phillips v Symes (No.3) , followed by Integral Petroleum SA v SCU-Finanz AG  and subsequently Bank of Baroda v Nawany Marin Shipping FZE  all supporting reliance on the use of CPR 3.10 to validate service where the step taken is for the service of a non-originating process. An originating process would make the application of CPR 3.10 far narrower with Popplewell J saying “CPR 3.10 is particularly apposite for treating as valid a step whose whole function is to bring a document to the attention of the opposing party where such function has been fulfilled. It prevents a triumph of form over substance” (para 37 of Integral Petroleum)
- Barton v Wright Hassall LLP  which was followed by the more recent decision in Piepenbrock v Associated Newspapers Limited  which did not support the use of CPR 3.10 to allow a Court to retrospectively validate a party’s failure to comply with the rules; the position taken here was on the basis that do validate under CPR 3.10 where there has been a failure of compliance, would be to make CPR 6.15(2) (and naturally CPR 6.27) redundant. Ideal Shopping Direct Limited v Visa Europe  followed suit here
Foxton J concluded that to follow the approach in Integral and Bank or Borada in relation to validating service errors, would see CPR 3.10(a) having automatic effect unless the court ordered otherwise; Foxton J did not agree this to be the intention and it is more reasonable to consider that the party seeking validation for errors made, should be the party to seek an order of the court. On that basis, Foxton J looked to the Claimant to make their case under CPR 6.27 – (and consequently CPR 6.15).
Making an order under CPR 6.27 – showing “good reason”
There was determined to be no hard and fast rule on what constitutes “good reason” and it was accepted that it must be taken in context of each case. Foxton J (later referred by DJ Leonard in Fiskin and originating for these purposes in Phillips v Symes) concurred that service of the notice of commencement (N252), whilst being a “distinct phase in proceedings”, does not constitute an “originating process”. Instead, it is simply the next natural step in the originating claim – the Defendant would be expecting it as part of the case to which they are already involved. Foxton J was satisfied on the facts of the matter, that “good reason” had been established.
a) Evidence clearly shows that service documents were sent to the Defendant which had been previously used and was set up to automatically forward to an in-use email address
b) Documents served were received through the agreed platform for service
c) In this case, not only did the documents being served reach the intended and correct party, but sent to an email address set up to receive electronic service
d) Had the Defendant opened the email (prior to receipt of the DCC) they would have been aware of this being an “attempt of formal service”.
e) Whilst validation of service prejudices the Defendant, it is not a significant prejudice (example being loss of limitation defence), the Defendant has open to it an option to seek to set the DCC aside if “good reason” can be shown.
Having then considered the previous decision in setting the original DCC aside, it was concluded that the Appellant’s appeal succeeded based on an argument not put to the Senior Master during the initial hearing.
Fisken Ltd v Carl
“CPR 3.10 does not operate to validate service that does not comply with the rules. Nor would it be right, in all the circumstances, to make an order under CPR 6.27 retrospectively validating service upon the wrong person by the wrong means.” …we now continue to review the specific case of Fiskin; heard as the judgment in Serbian Orthodox Church v Kesar appeal was handed down
It is important to note that the judgment in Serbian Orthodox Church v Kesar appeal was handed down during the hearing of Fiskin. This hearing follows several applications by both parties summarised as;
- (Defendant) Application for extension to serve POD’s
- (Defendant) Application to set aside DCC obtained by the Claimant on 27/11/20
- (Claimant) Application seeking that the Court remedy errors in serving the Bill of Costs/court determined deemed service was effected
- (Defendant) Application seeking stay of the detailed assessment pending determination to appeal
It was agreed by all parties that the application to set aside should be the first of the applications to be heard, along with the Claimant’s application for remedy. CPR 47.6, CPR 47.9, and CPR generally are the relevant rules governing commencement of detailed assessment and sanctions for non-compliance; whilst CPR 47.12 and PD47 11.1 governs setting aside a DCC. All of which were relevant in this matter to determine whether service had been effected and then, whether the Claimant was entitled to the DCC ordered.
In July 2018, the Claimant issued proceedings on a US resident Defendant living in Washington; the proceedings related to an alleged breach of contract – the trial proceeded in December 2019 where judgment was granted to the Claimant. The Defendant was ordered to pay £200,000 interim payment on account of costs; the Defendant appealed and the hearing proceeded in May 2021. The crux of this matter seemed to fall in that following the initial hearing, the Defendant’s Counsel confirmed to the Claimant’s solicitor that he was no longer acting; communications continued between the Claimant and Defendant confirming that the Defendant continued to receive the communications to the address the Claimant was using. In October 2020, the Claimant’s costs representatives sent an N252 (£510,7463.61) by email to the Defendant at the email address provided by the now stood down Defendant representative (Davis Woolfe). Hard copies were sent additionally. The Defendant did not respond, and the Claimant obtained a DCC. On 25 November 2020, a new solicitor for the Defendant wrote to the Claimant confirming they were now acting – in the intervening time the Defendant had been granted permission to appeal the main claim. The DCC was provided to the Defendant’s new representatives where disagreements ensued as to whether the Claimant had been entitled to the DCC.
The Claimant had at that point agreed to set the DCC aside on the agreement that the Defendant served their replies within 21 days – naturally, they would have needed to re-serve the Bill of Costs if they were accepting defective service so the 21 day rule would not come into force. The Defendant failed to serve POR and, in the background, made their application for a stay to the Court of Appeal (later the SCCO as directed).
Defective service – the Defendant’s argument
- Attempting service upon the Defendant directly, when the right course of action was to serve on the initial representative for the Defendant (both parties failing to adhere to CPR 42.2 and Defendant not filing notice of change)
- Mandatory requirements of PD 6A had not been complied with; the Defendant never having indicated he would accept service by email (4.1 of the PD not complied with)
- Posting hard copies to an invalid address for service
The Defendant maintained that rule 47.12(1) was a “mandatory provision…that rule provides that if a party Is not entitled to a Default Costs Certificate, the court will set it aside”. Abela was referenced at this point in the judgment wherein Lord Clarke said at para 36; “Service has a number of purposes, but the most important is to ensure that the contents of the document are brought to the attention of the person to be served (para 37). This is therefore a “critical factor”. However, the mere fact that the defendant learned of the existence and content of the claim form cannot, without more, constitute a good reason to make an order under rule 6.15(2)”
It therefore follows in the Defendant’s view that, simply because the Defendant became aware of service, this would not be enough for the Court to make such an order under PD 6.15 – the CPR is to be followed and is strict in terms of effective valid service. The issue of Davis Wolfe, prior to these applications, mistakenly assuming he was off record following handing down of judgment was critiqued along with the Claimant going along with the Defendant’s legal mistake here.
The Claimant sought to rely on the implied position that Davis Woolfe, having provided an alternative email address, was confirming that the Defendant would accept electronic service satisfying ”CPR 6.23(6) and of paragraph 4.1 of Practice Direction 6A. (It is accepted that the Claimant did not comply with the requirements of paragraph 4.2). If compliance with paragraph 4.1 is not accepted, then pursuant to CPR 3.10 neither procedural defect invalidated service. Alternatively, pursuant to CPR 6.15, read together with CPR 6.27, the court should order that the steps already taken to bring the bill of costs to the Defendant’s attention constituted good service” (para 55)).
The Claimant relied on CPR 3.10 on that basis that it has wide effect and given there is no prejudicial effect, it should apply in this instance if defective service is determined. The Claimant relied on the fact that at the time, the Defendant had at no point advised that the email containing the N252, and associated documents had not come to the Defendant’s attention.
CPR 6.15 together with CPR 6.27 in conjunction with Abela
The Claimant sought to argue that there was good reason to order that appropriate steps had been taken to bring the claim form to the Defendant’s attention therefore compliant with 6.15. The Court in Abela found good reason to determine that service should be deemed. However, “the mere fact that the defendant learned of the existence and content of the claim form could not, without more, constitute a good reason to make an order under rule 6.15(2). On the other hand, the wording of the rule showed that it was a critical factor” (para 59).
There is no dispute here in the “critical factor” existing as the Defendant did learn of the notice of service. DJ Leonard proceeded at this point to consider Serbian Orthodox Church; handed down during this hearing wherein detailed review of CPR 3.10 and CPR 6.27 was made therefore having specific relevance to the case before him.
DJ Leonard’s Conclusion
1. Seeking to set aside the DCC previously
There was surprise that the court officer did not simply authorise setting aside of the DCC when the Claimant sought the same in December 2020; CPR 47 11.1 provides for a court officer to have this authority when the request is made by the recipient of the DCC. The DCC should have been set aside at that point – DJ Leonard went on later to indicate that this would have avoided many of these subsequent issues.
2. Valid Service or Not?
Notice of commencement was served under a category of errors which could not be ignored;
a. Served on the wrong person;
b. Served by the wrong method;
c. Served simultaneously on the wrong address;
3. Was the N252 an ‘originating process’?
This breaks down to whether detailed assessment proceedings are new proceedings or a continuation of proceedings; DJ Leonard found them to be the latter mirroring Foxton J’s decision, given they follow the court in which the main proceedings have begun. Interestingly, it was pointed out that even if he had concluded the former, then service on Davis Woolfe in any event would have been defective as he would not have been on record for these proceedings – regardless of whether he considered he was on record for any proceedings at the stage of filing the N252.
4. Can CPR 3.10 validate service
The decision is that CPR 3.10 cannot be used to validate the category of errors made here by the Claimant in the invalid service on proceedings. The errors are neither minor nor technical – and (following the now binding judgment of Serbian Orthodox Church) CPR 3.10 cannot be used to validate service.
By coming to this determination, the question as to the effect of CPR 47.12(1) no longer exists given the finding of defective service above.
5. Were reasonable steps taken to effect service?
In short, DJ Leonard found not, he forcefully commented;
93. “The provisions of the CPR for service upon a solicitor, for service by email and for service to the right postal address should be familiar to every solicitor who conducts litigation, and as I have said the multiple errors made in purporting to serve the Defendant could have been avoided with a little diligence.
94. Solicitors are officers of the court. They are expected to understand and to comply with the Civil Procedure Rules. Mr Shepherd makes a good point when he says that an order under CPR 6.27, retrospectively authorising service on the facts of this case, would offer an indication that even for a solicitor, compliance with the rules is optional.
a. It would prejudice the Defendant to not be able to respond to the Bill amounting to more than £500,000 (differentiation made with Serbian Orthodox Church on basis of value)
b. To deprive the Defendant (now unrepresented) by allowing and rectifying avoidable procedural errors was not in accordance with the overriding objective
c. To allow the Claimant to avoid the consequences of their mistakes, but not allow the Defendant the same benefit would result in a “significant windfall” to the Claimant
For the reasons given, the Default Costs Certificate was set aside as the Claimant was not entitled to it. It followed that the subsequent applications for extensions and stay for detailed assessment were refused and a timetable to be provided for a suitable timeframe for Points of Dispute to be served.
These are interesting cases both being heard almost along side one another with clear difference between the facts of each matter; context clearly being of relevance as suggested by Foxton J. In all these cases referenced and these two in particular, the courts continue to be pushing the message that litigators must be aware of the rules and not look to rely on the provisions within the CPR as a ‘get out’ for failure to know, understand and apply the rules. Mistakes and errors will not be swept over. I also see that there is a correlation with more of these types of authorities coming to light following the pandemic and required home working arrangements. It would suggest that there is a gap in learning to those undertaking service duties and communications between senior litigators and those less experienced.
In my opinion, these rulings seek to enforce the rules regardless of the excuses provided; and these two cases highlight that when you are serving notice for detailed assessment, this is simply a continuation of originating proceedings before; this should make it simply enough to be able to contact your opponent to obtain, check and agree relevant service details so as not to trick your way towards a DCC which, in all likelihood will be set-aside if you haven’t carried out due diligence and followed the rules.