Relief from Sanctions granted where the Particulars of Claim were deemed to have been served Late
In the case of Altiatech Ltd v Birmingham City Council [2023] EWHC 1371 (TCC), the Claimant was granted relief from Sanctions by Mr Justice Waksman for providing late service of the Particulars of Claim.
The Claimant had submitted an application to seek a retrospective extension of time and/or relief from Sanctions under 3.9 in respect of its late service of the Particulars of claim.
This judgment specially refers to the rules in respect of procurement. However, it is imperative that the legal profession does not get caught out in the same way when it comes to service of the Particulars of Claim.
In this case the judge did find that the Claim form had been served in time. However, the Particulars of Claim had failed to be served within 7 days of the Claim form, therefore meaning the document was served late.
The Judge confirmed that in his view the correct approach was to apply the usual Denton Principles.
The Judge granted relief from sanction stating the following:
“Having considered all of the above, and while the point is not free from difficulty, I take the view that the effect of Regulation 94(1) and CPR 7.4(2) is that the Particulars of Claim must be served within 7 days of the issue of the Claim Form. That is very tight but not impossible.”
In addition, of course in many cases the relevant 30 day limitation period can and will be used, not merely to draft up a Claim Form but also the Particulars of Claim. The effect of that is that the Particulars of Claim here were indeed served 15 days late. They should have been served on 26 October which was the final date for service of the Claim Form. They were not and were not deemed to have been served until 10 November.
It is against this backdrop that I then have to consider Altiatech’s retrospective application for an extension of time in which to serve the Particulars of Claim, to which I now turn.
The Law
“As already noted above, initially the Authority took no point on the late service of the Particulars of Claim and originally was going to file a Defence by 23 December pursuant to an agreed extension. Its application to strike out and/or for summary judgment which included the point on late service of the Particulars of Claim was not served on Altiatech until 12 January. Altiatech then made its application for an extension on 27 January, so 15 days later. It is common ground that the application for an extension here should be determined according to Denton principles. However, in this context Altiatech contends that in relation to late service of those Particulars of Claim, in contrast, for example, to seeking an extension of time in which to serve a Claim Form, the late service is not always to be regarded as inherently serious and significant for the purpose of Denton stage 1.
Here reliance is placed on the decision that Popplewell J, as he then was, in the case of Viridor Waste Management Ltd v Veolia ES Ltd [2015] EWHC 2321 (Comm). In that case the Particulars of Claim had been served one, two or three days late (it did not make a difference which it was for the purposes of the Judge).”
The Judge made reference to Ms Bingham QC who argued that any delay is always serious and significant. However, the judge commented saying a delay of seconds or minutes must always be significant is unrealistic and not in accordance with the guidance of Denton.
The judge said:
I cannot accept that these matters made the delay significant or serious. It is the issue of the Claim Form which stops the running of time for limitation purposes. Service of the Particulars of Claim is a subsequent step in the proceedings which does not validate or invalidate the effect of issue of the Claim Form for limitation purposes…”
However, the Authority also prays in aid the tight timetable prescribed for procurement challenges, and it is true that in this context Coulson J said in Cemex the following at paragraphs 15 and 16:
“15 It should be noted that, in the context of procurement challenges, everything has to be done in accordance with a very tight timetable from first to last…An application for an extension of time to serve the particulars of claim which, on the facts of this case, would have the effect of delaying the service of the particulars of claim by a minimum of seven weeks, must therefore be seen in the context of the required tight timetable in cases of this sort.
In respect of the first Denton question, the judge found that the delay of 15 was not serious or significant stating “This is principally because the Authority itself did not seem to think it was, since it raised no point about the late service of the Particulars of Claim until 23 December”
In respect of the second Denton question, the judge accepted there was a good reason for the default, noting the Claimant’s solicitor accepted he had mis-understood the time for service of the Particulars of Claim giving relevance to of Regulation 94 and its impact on 7.4(2) is not straight forward.
Whilst the judge stated “An error of law by a solicitor is generally not considered to amount to good reason”
He then proceeded to confirm, “In this context, I was referred to Holterman v Electrium [2020] EWHC 3915 (TCC) at paragraph 77, although that was not a case about the operation of 7.4(2) in the context of Regulation 94 since it was not a procurement case. In any event the Particulars of Claim there were served 13 days late, and part of the strike-out application concerned that late service. In the event, the Judge did not strike out the claim and granted a retrospective extension of time.
However, in this case, the reason for the default should, in my view, be given at least some weight when one considers the overall circumstances to which I now turn.”
In respect of the third Denton question, the judge took an overall view of the circumstances of the case noting the application of relief was not submitted until 15 days after the Claimant had been appraised of what the Defendant was contending. The judge commented saying:
“That is a fair point, although of course the strike-out application which had been made encompassed very much more than simply a point on the Particulars of Claim, and so Greystone was having to deal with a number of matters. There is no basis for saying, as the Authority does, that Altiatech’s application for relief was made 80 days late. That would assume it should have been made on or after 26 October, but that is completely unrealistic when for two months the Authority never took the point. Therefore, Altiatech could not have known that such a point was going to be taken, and which it did not know until 12 January.
The Authority then says that Mr Himdy compounded the delay because he held off posting the Particulars of Claim for a day while he consulted Counsel. I see that, but in the overall scheme of things it is not material. On the other hand what I think might have enabled the whole action to have started much earlier is if the Authority had been open at the outset about the underlying reason for its actions, which I have dealt with above. Its reluctance to explain its position led to a delay of much more than 15 days in my view.”
The judge confirmed that not providing relief where he had upheld that the Claim form had been served in time would be grossly disproportionate as it would deprive the Claimant of a claim of some substance.
Summary
Understanding of the rules in respect of service is key.
A key point to note is a Claim Form is deemed served on the date they are posted. However, when it comes to the Particulars of Claim these are not deemed served until arrival of the same, that being 2 days after postage.
When seeking relief from Sanction the “Denton Test” is still applied to overcome the error and be granted relief from Sanction. If a relief is required, time is always of the essence!
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Sarah Slesser, Legal Costs Service Manager
05.09.2024