Olafsson v Gissurarson (No 2)

This Icelandic saga continues. On 8 December 2006 I handed down my judgment in the appeal by the defendant against the order of Master Turner dated 23 May 2006. The draft order proposed by the successful appellant included an order that the claim be dismissed. That was a logical proposal unless the claimant/respondent could take any step to revive this claim notwithstanding the fact that as a result of my allowing the appeal the two default judgments had been set aside.

This judgment must therefore be read in conjunction with my judgment dated 8 December 2006.

The response by the respondent was to seek relief under CPR 6.9 in the form of an order dispensing with service of the claim form and particulars of claim, alternatively an order under CPR 7.6 (3) for an order extending the time for service of the claim form to a date which will enable re-service to take place. The respondent has not put in any formal notice of application in respect of either form of relief sought. So far as the CPR 7.6 application is concerned that was flagged up informally in July of this year as a course the respondent was likely to take if matters otherwise went against him, and was expressly referred to in paragraph 94 of his skeleton argument for the hearing of the appeal. Though the rule as will be seen requires such an application to be “supported by evidence” Mr Mercer is content to make the application on the basis of the evidence in the papers before me on the appeal.

So far as the application under CPR 6.9 is concerned no point is taken by Mr Dhillon for the claimant about the want of an application. I was initially concerned that in the appeal against the refusal to set aside the default judgments the Master had as alternative based his ruling on CPR 6.9 and the respondent did not seek to support that part of his ruling. However that was in the context of that appeal and in the light of the authorities that I set out in my earlier judgment, particularly Nussberger [2006] EWCA Civ 654. My allowing of the appeal does not therefore, as a matter of technicality, as it seems to me, preclude this argument from being run, nor has the contrary been suggested.

CPR 6.9(1); The court may dispense with service of a document.

The claimant’s argument is that the power in this rule can be invoked in exceptional circumstances, which particularly could include an unsuccessful or ineffective attempt to serve the proceedings in a method that was prescribed, where that unsuccessful attempt has succeeded to the extent of putting the proceedings in the hands of the proposed defendant.

The existence of this power he argues, is supported on the authority of the Court of Appeal in a collection of five appeals reported as Anderton v Clwyd County Council and others [2001] WLR 3174. These were all domestic claims in each of which the claimant had issued a claim form shortly before the end of the limitation period and had then failed to serve within the time allowed. The court addressed the question of whether there was power under this rule to dispense with service retrospectively as well as prospectively. In the courts judgment there was, but it was one only exercisable “in exceptional circumstances” - see Mummery LJ at paragraph 50.

The learned Lord Justice distinguished two different kinds of case. The first was an application by a claimant who had not even attempted to serve a claim form within time by one of the methods permitted by the rules. In that type of case the earlier case of Godwin v Swindon Borough Council [2002] 1 WLR 997 was authority to the effect that such an attempt to “circumvent the limitations in rule 7.6(3) on the grant of extensions of time for service of the claim form” would not be made. The second category was considered in paragraph 58, namely an application by a claimant who had already made an ineffective attempt, in time, to serve a claim form by one of the methods allowed by rule 6.2 in circumstances where the defendant or his legal advisor had in fact received and had his attention drawn to the claim form. Dealing with an application from such a claimant Mummery LJ said at paragraph 58: -

A differently constituted Court of Appeal returned to this question in another group of cases reported as Cranfield and another v Bridgegrove Ltd [2003] 1 WLR 2441. In one of those cases, all of which concerned attempts to effect service of proceedings after the expiry of the 4 month time limit, the finding of the court was that good service had indeed been effected and it was therefore not necessary to decide the claimant’s application under CPR 6.9. But the court in view of the importance of the question went on give some guidance as to the scope of that rule.

The short facts of the relevant case were that the claimant’s solicitors had been told by the defendant, which was a limited company, that its solicitors would accept service. Despite that, the claimant’s solicitors attempted to effect service at the defendant company’s registered office. The judge at first instance misdirected himself and thought that the service at the registered office was bad, but concluded that as it was a mere technical error he should make an order under 6.9. That exercise of his discretion was in the judgment of the Court of Appeal unnecessary, as it found that the service was in fact good. The court acknowledged with approval the Anderton criteria, as it called them, and said that though the facts did not precisely fit those criteria that in the “very unusual” circumstances of the case they were considering, had it been necessary to do so they would have decided it was right to dispense with service under rule 6.9.

Though Mr Mercer claims to detect some slackening of the criteria and in Anderton in Cranfield I myself cannot see it. The position is that any deployment of rule 6.9 in such circumstances is either exceptional or very unusual and if there is any difference between those two phrases it is not one which is obvious to my eyes.

Returning to Nussberger, at paragraph 66 the Court held that on the facts of that case, if it had been a domestic case and not one in which the Conventions were in play, CPR 6.9 could be invoked, referring in so doing to Anderton and to Cranfield. Neuberger LJ said at 73 :-

So, argues Mr Mercer, there is no objectionable fiction involved, namely that a document has been served when it has not, which was the problem, as I have earlier found, for the defendant in supporting the default judgment on the authority of Nussberger. On the contrary, he says, the court can be reassured that the matter can properly proceed, the formality can be dispensed with and acknowledgment of service entered and so forth.

Mr Dhillon’s objections to the use of rule 6.9 in this way is to state, correctly, that it is being used to save proceedings which are otherwise statute barred as from August 2005. He says there is a short limitation period imposed by Parliament on actions of this class, without any power to extend, and this is done for good reason. He points to Elmes with its clear statement that CPR 6.8 cannot be used retrospectively and therefore, he argues, by necessary analogy CPR 6.9. He relies on Godwin v Swindon Borough Council [2002] 1 WLR 997 which stated (paragraph 50) that a claimant who had by mistake failed to serve a claim form within the time period permitted needs to resort to rule CPR 7.6(3) if his application for an extension of time is not made before the current time period is expired, and that these are the “only circumstances in which the court has powers to grant such an extension.” May LJ continued at paragraph 50

Mr Mercer puts his cards on the table. He accepts that CPR 7.6 sets a stricter test for a claimant who wishes to save his claim after the time for service of his claim form has expired. It prescribes the only circumstances in which that is permitted. They are a three fold requirement, as Mr Dhillon rightly analyses the matter, that the claimant must show on evidence that he has taken all reasonable steps to serve claim form “but has been unable to do so”; secondly that he has acted promptly in making his application; and thirdly that the court should exercise its discretion in his favour. But Mr Dhillon is wrong to state that the Anderton and Cranfield authorities are weakened for Mr Mercer’s purposes by the fact that they are not cases where limitation had run. Quite plainly each one of those claimants faced a limitation problem if his application was not allowed, therefore the converse of that proposition is that they were claims that were otherwise against defendants with accrued limitation defences. Nevertheless Dyson LJ in the passage cited above felt able to approve the Anderton second category of case in which retrospective applications could exceptionally be made which would have the effect of keeping the claim alive.

So, Mr Mercer argues, the facts of this case place it comfortably in the second Anderton category, namely where although the defendant has won on a technical point and has succeeded in overturning the default judgments, for the reasons stated in my first judgment, the claimant should be regarded as someone who has in fact already made an ineffective attempt in time to serve a claim form by a method allowed by the rules. The defendant does not dispute that he has in fact received and had his attention drawn to the claim form by a permitted method of service, albeit one which was incompletely executed. As to factors which should influence me he argues that this is not a case where a foreigner has been “impleaded”, to use Colman J’s word in Shiblaq. The claimant lives in England and is entitled to sue in England and jurisdiction is not challenged. The defendant has had the benefit of his “bad service” point in setting aside the default judgments, and if there is a windfall in this case, argues Mr Mercer that is it. The responsibility for the default in service is shared by the claimant and the FCO, and the defendant should not be able to take advantage of this by ignoring the process which is served on him albeit with a technical default and of which he is perfectly aware. He ran a high risk strategy in doing nothing for fifteen months and then seeking to challenge service as he did. The claimant took every step to keep the defendant informed of the stages in the litigation as they took place, and the merits are therefore in favour of acknowledging that this is an exceptional case in which the rule should be deployed retrospectively.

Mr Dhillon in reply stresses the limitation point that I have set out above. Save that this is a shorter limitation period than those which were being considered in Anderton and Cranfield the point he takes it seems to me was equally in play in those cases, for the reason I have given above. I accept that Parliament has deliberately decreed a 12 month limitation period for cases of libel for good policy reasons, namely that they are seen as claims that should be brought quickly, should not be protracted and should come to justice when memories are fresh. Beyond saying that, and indicating that this being an internet libel case evidence as to the impact of the publication, if any, may have become more difficult due to the passage of time, he points to no more specific disadvantage which the defendant will suffer if the claim proceeds. He bases most of his arguments against the availability of rule 6.9 on this point. I do not read the court of appeal in either Elmes or Godwin as precluding the use of this rule in these circumstances. Godwin was a case on what might be called Anderton category one, namely a claimant who had not even attempted to serve his claim in time by use of a permitted method. That is not this case. Elmes did not deal with rule 6.9.

On matters going to broad discretion Mr Dhillon points to the lack of any evidence from the claimant himself to explain why he was in fact unable to achieve valid service, whether it was the inexperience or incompetence of his solicitors, or whether he had some reason of his own to take the course he did. I should assume a knowledge of the law on his part, and his solicitors should have known that the certificate of service they received indicated that the method of service that they had requested, namely service through Icelandic authorities, had not been achieved. He therefore submits that they should have informed themselves in time as to the exact requirements of Icelandic service, which they could have done by taking appropriate advice, and sought to rectify the position before the expiry of relevant expiry dates.

My conclusion on this rule is that I do have a jurisdiction to entertain the claim under it. The principles on which I should exercise the discretion I have, it being in my judgment an exceptional and very unusual case, are to be found in the decisions in Anderton and Cranfield. I am persuaded that I should exercise my discretion in the claimants favour. The failure to achieve valid service was for want of the merest of technicalities, in circumstances where the fact of service is accepted. The only defect was as to evidence of service, and the best evidence is now available in that the defendant accepts and has always accepted that he did indeed receive all the relevant documents in appropriate form at the appropriate time. The limitation point is a sword with two edges. While the effect of this order will be to deprive the defendant of an accrued defence, the failure to make it would be to deprive the claimant of having this case considered on its merits. No serious argument has been addressed to me to support the notion that the passage of time has made the resolution of this case more difficult for either party or for the court. The defendant has said he intends to justify his remarks. It seems to me that the sooner the merits of this claim are considered and the interlocutory wrangling ends the better the overriding objectives of our civil courts are likely to be achieved. I therefore exercise my discretion in favour of the claimant and order that service of this claim be dispensed with and that the matter should proceed.

In view of the decision I have reached above it is not necessary for me to reach a conclusion as to whether the power under this rule should be exercised on the facts of this case. The provisions are different and it does not necessarily follow that the results would be the same. But in order to bring some finality, I hope, to this stage of the proceedings I make no order either way under this rule.