Welcome to the thirty-ninth edition of Clyde & Co's (Re)insurance and litigation caselaw weekly updates for 2015
This week's caselaw:
Tseitline v Mikhelson
The meaning of "personal service" of a claim form
http://www.bailii.org/ew/cases/EWHC/Comm/2015/3065.html
CPR r6.5 provides that a claim form can be served personally on an individual within the jurisdiction by "leaving it with that individual". However, the Rules provide no further guidance as to the interpretation of that provision.
In this case, two process servers approached the defendant one evening. The first held out an envelope (marked only with the printed name of the claimant's solicitors) containing the claim form and told him "I'm here to serve you papers as part of a High Court, a High Court claim". The defendant speaks little English. He took hold of one side of the envelope, but the process server held on to the other, and after the defendant's daughter spoke to him, the defendant released the envelope. The second process server subsequently placed the envelope underneath the defendant's arm, whilst telling him he was being served. The defendant then allowed the envelope to fall to the ground.
Phillips J held as follows:
(1) The House of Lords decision of Kenneth Allison Ltd v A.E. Limehouse & Co [1992] establishes that the process server must hand the relevant document to the person upon whom it has to be served. If the defendant refuses to accept it, the process server may tell him what the document contains and leave it with him or near him.
(2) A person can only "accept" the document if the nature of the document is readily apparent or known to the recipient or otherwise explained to him so that he can be taken to know its nature. If an unmarked envelope is given to a defendant without any explanation, he can regard it as junk mail.
(3) A document will be "left with" the defendant if the defendant has some degree of possession of it (even if the process server subsequently takes it away again).
(3) Where the defendant refuses to accept the claim form, the focus is on the knowledge of the recipient, not the process by which it is acquired. Whilst in most cases knowledge of the nature of the document will be found to have been imparted by a simple explanation, it is clear that it can be also readily be inferred from pre-existing knowledge, prior dealings or from conduct at the time of or after service.
Applying those principles to this case, the judge held that the first process server had not handed the claim form to the defendant, since he had not released the envelope.
By the time the second process server acted, it was clear that the defendant did not accept the document. However, the claim form had been "left with" him. On the facts, the judge found that the defendant's companions had translated what was said to him and so he thereby acquired knowledge of the nature of the document. He had therefore been personally served with the claim form.
Bank St Petersburg v Arkhangelsky
Disclosure and documents within a party's "control"/translation of expert reports
http://www.bailii.org/ew/cases/EWHC/Ch/2015/2997.html
The defendants sought disclosure of documents which were not physically in the possession of the claimants but which were said to be under their control (pursuant to CPR r31.8). After analysing the relationship between three individuals and the claimant, Hildyard J concluded that, if the relationship was governed by English law, it would be analogous to an agent or nominee relationship. However, that did not entitle the defendants to disclosure of all documents relating to the claimant: "only to documentation relating to the course or conduct of the agency relationship". Furthermore, companies which were wholly owned by the three individuals were not thereby agents of the claimant: "they would be agents (or, perhaps more accurately, sub-agents) only if and to the extent that they undertook the agency role primarily assigned to the relevant named individual". In any event, except in exceptional circumstances (such as a one-man company), a shareholder does not "control" the company's documents, since the consent of the directors is required.
There would also be practical difficulties in enforcing a disclosure order in Russia. The judge therefore ordered the claimant to write to the three individuals explaining that the claimant required them to provide certain defined documents for the purpose of the proceedings.
A further issue in the case was whether the claimant's expert report should be translated into Russian for the benefit of one of the defendants whose English is very limited. This had become necessary once the defendants' lawyers had ceased to act for them. The claimant argued that it would be expensive and time consuming to translate the report, which was long and technical. Nevertheless, a translation was ordered, for reasons of fairness. The defendants were already at a disadvantage in not having legal representation and being unable to leave France to contest the matter: "Whilst I am not convinced that to deny them such opportunities would of itself result in a breach of any enforceable right, it seems to me that the balance plainly favours eliminating this potential source of apparent potential unfairness".
Jong v HSBC Private Bank
Whether permission to serve out should be given in a case involving multiple defendants
http://www.bailii.org/ew/cases/EWCA/Civ/2015/1057.html
The claimant wished to sue a Monacan bank regarding certain trades placed on her behalf and also two English group companies which, she said, failed adequately to investigate her complaint. The case was governed by Regulation 44/2001 and two conflicting principles arose: (1) the Regulation provides that companies should be sued in their Member State but (2) the claimant had entered into an agreement with the Monacan bank which provided for exclusive jurisdiction in favour of the courts of Monaco (which is not a Member State) – although the claimant could otherwise rely on one of the gateways for service out against the bank. Accordingly, the court was required to decide which factor was more important: the need to avoid the risk of inconsistent judgments and the cost of parallel proceedings or the need to hold parties to their bargain.
At first instance, the judge held that the Monacan bank should be sued in Monaco. That decision has now been upheld by the Court of Appeal.
It held that the judge had not erred in ranking the defendants in order of importance and he had been correct to see the claim against the foreign bank as being the most important of the claims. The only guidance to be drawn from Donohue v Armco [2001] was that parallel proceedings should usually be avoided, but the facts of that case were very different from the facts of this case. Furthermore, had the chosen jurisdiction in the agreement been a Member State, that would have prevailed over the principle that defendants should be sued in their own Member State.
The Dorchester Group v Kier Construction
Whether the defendant had made an admission
http://www.bailii.org/ew/cases/EWHC/TCC/2015/3051.html
One of the issues in this case was whether the defendant had made an admission. CPR r14.1 provides that where a defendant makes an admission, the claimant has a right to enter judgment (and the permission of the court is required to withdraw an admission). The rule does not require an admission to be in any particular form, merely that it be in writing
The defendant had made an open offer which "accepted" the claimant's case for the purposes of the offer. That was not enough to amount to an admission under CPR r14.1, and the offer had made no reference to CPR r14.1 either. Furthermore, for judgment to be entered, the admission has to be clear and unequivocal, and that was not the case here. Accordingly, the claimant was not entitled to enter judgment.
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