Multiple service failures lead to a Default Costs Certificate being overturned – Gregor Fisken Ltd v Carl [2021] EWHC B9 (Costs)

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Posted on: July 1st, 2021 by Elena Kostova

The case of Gregor Fisken Ltd v Carl [2021] EWHC B9 (Costs) serves as an important reminder of the need to comply with service rules when serving a Bill of Costs so that a Default Costs Certificate can be correctly obtained if the paying party fails to file Points of Dispute.

 

The background

Following conclusion of the substantive matter the solicitors for the Defendant advised the Claimant’s solicitors they were no longer acting. They further advised that the Defendant had instructed a direct access barrister and that any future correspondence should be sent to the Defendant on a specified email address. Importantly the solicitors, David Woolfe, did not file a Notice of Change or apply to come off the Court record.

The Bill of Costs was prepared by MRN Solicitors totalling £510,743.61. The Bill was purportedly served on the Defendant direct by post and email. Three errors were argued to have been made in the purported service:

  1. The Defendant solicitors were still the party on record and Notice of Commencement ought to have been served on them
  2. Service on the Defendant’s direct postal address was not valid service
  3. Service on the Defendant via email was not valid as there was no prior agreement

In absence of a response from the Defendant the Claimant solicitors obtained a Default Costs Certificate on 27 November 2021. In the meantime, on 25 November, Charles Russell Speechlys LLP took over conduct for the Defendant and wrote to Rosenblatt with a Notice of Change. They further advised permission to appeal had been granted and requested a stay of the detailed assessment proceedings.

Even though the Defendant was aware of the Bill having received it by email, an application to set aside the DCC was made taking issue with the service. The Claimant in turn applied seeking that the Court remedy any error in respect of serving the Bill and/ or for an order pursuant to CPR 6.15(2) and CPR 6.27 that service be deemed good service.

 

At the hearing

The applications were dealt with at a hearing in March 2021 before Master Leonard. With regards to solicitors on record, the Master held that the Bill should have been served on David Woolfe as the firm was still on the record. The argument that there was no requirement to file a Notice of Change where the substantive matter had concluded was rejected.

It was further held that attempting to serve by email breached the requirements of PD 6A as the Defendant had not provided an agreement to accept service by email and the Claimant had not made enquiries as required by paragraph 4.2.

On the point of postal service, the Master held that the address used was not a valid address for service.

With regards to the correct approach regarding service Master Leonard said: “In the circumstances, all that the claimant had to do to effect service of the notice of commencement was to send it and the appropriate supporting documents by DX or ordinary first class post to Davis Woolfe. Instead, the claimant attempted to serve upon the wrong person, by the wrong method, simultaneously serving by post to the wrong address. All of these errors could have been avoided with a little diligence.”

Following the considerations in relation to service and prejudice to the Defendant, the Default Costs Certificate was set aside.

With regards to the Claimant’s application for the service to be validated, it was held that it cannot be right to use CPR 3.10 so as to validate service upon the wrong person by the wrong electronic method and physically at the wrong address. It was not in dispute that the documents had come to the Defendant’s attention but the same was not sufficient to comply with service requirements. The application was therefore refused.

 

Comment

This case signifies again the importance of compliance with service rules. Whilst electronic communication is currently an essential part of all litigator’s day to day lives, it is vital to not assume acceptance of electronic service or it could result in a substantive delay and additional costs to rectify the position. As to incorrect postal service and wrong party in the first place, it seems to be the correct decision was reached in not validating the purported service.

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