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England and Wales High Court (Commercial Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Commercial Court) Decisions >> Tseitline v Mikhelson & Ors  EWHC 3065 (Comm) (28 October 2015)
Cite as:  EWHC 3065 (Comm)
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QUEEN'S BENCH DIVISION
Fetter Lane, London, EC4A 1NL
B e f o r e :
| ALEXANDRE YAKOVLEVICH TSEITLINE
|- and -
(1) LEONID VICTOROVICH MIKHELSON
(2) SWGI GROWTH FUND (CYPRUS) LTD
(3) ELDON VENTURES LTD (in liquidation)
(4) INTERTRUST TRUSTEES (UK) LTD
Alain Choo-Choy QC and Andrew Scott (instructed by Baker & McKenzie) for the First Defendant
Hearing date: 18 May 2015
Crown Copyright ©
Mr Justice Phillips:
i) After Mr Mikhelson had alighted from the rear driver's side door and was standing in the road by the boot of car, he was approached by Mr Austin, who held out his envelope, saying "I'm here to serve you papers as part of a High Court, a High Court claim. We're here to serve you [the] claim papers". Mr Harber filmed the exchange from the other side of the car.
ii) As Mr Austin spoke, Mr Mikhelson took hold of one side of the envelope in his right hand, whilst Mr Austin retained his hold of the other side of the envelope.
iii) At the same time Victoria Mikhelson walked round the back of the car to join Mr Mikhelson and Mr Austin. Mr Mikhelson looked at his daughter and said "A chto eto takoe?" (translation: What is this?). No response from Victoria Mikhelson is audible, but Mr Mikhelson loosened his grip on the envelope so that he held it between his index and middle fingers of his right hand, and then he released the envelope altogether, leaving Mr Austin holding it alone. At no point during this exchange did Mr Austin let go of the envelope.
iv) Mr Mikhelson and his daughter then walked towards an entrance to the Gallery, where they were directed to another entrance. As they walked, Mr Austin remained beside Mr Mikhelson, stating several times that he was there to serve papers "as part of a High Court" and that Mr Mikhelson needed to take them. On three occasions Mr Mikhelson said to Mr Austin, in English, "Speak only Russian".
v) As Mr Mikhelson and his daughter walked past the entrance to Whitecapel underground station, en route to the second entrance to the Gallery, Mr Austin said to Victoria Mikhelson "Can [or Could] you give these to your father, he needs to take these. These are part of a High Court, the High Court. You need to give these to your father". Mr Mikhelson said to his daughter "Ne slushay ego" (translation: "Don't listen to him"). As they entered the Gallery, Mr Austin said "You need to take these. You've now been served" [possibly adding with High Court papers].
i) Mr Mikhelson and his daughter joined Teresa Mavica and Ekaterina Burgess, who had been waiting for them in the Gallery. They spoke in Russian, although their words were not caught on the recording. Mr Austin stood next to them. Ms Mavica accepts that she heard Mr Austin say that he was there to serve papers: Mr Austin states that he referred to serving High Court papers.
ii) Mr Mikhelson then walked away from the group and encountered Mr Harber at very close quarters, telling him (in Russian) to "go away". Although not captured by the recording, it is common ground that at this point Mr Harber attempted to serve the envelope on Mr Mikhelson. Mr Harber states that he placed it "in between the crook of [Mr Mikhelson's] arm and his body where it lodged after I let it go". Mr Austin states that Mr Harber "thrust the envelope into Mr Mikhelson's chest/arms ... As Mr Mikhelson walked away from us he threw the envelope to the floor." Mr Mikhelson, in his second witness statement, says that Mr Harber "tried to shove the envelope behind my lapel, but it fell to the floor". Ms Mavica states, in her first statement, that Mr Harber "tried to place an envelope ... against Mr Mikhelson's chest Mr Mikhelson opened his arms so that the envelope fell on the floor".
iii) Although not apparent from the video, it is clear that Mr Mikhelson then walked through a door from the foyer into the ground floor of the Gallery. Mr Austin states that he threw his envelope after Mr Mikhelson, but that it hit the door as it closed and so Mr Austin picked it up.
iv) Meanwhile Mr Harber picked up the envelope he had attempted to serve on Mr Mikhelson and lodged it between Victoria Mikhelson's back and her shoulder bag, in which position it can be seen on the video. That envelope fell to the floor, where it was picked up by a woman in a white jacket, but something was said or indicated to her, causing her to place it back on the floor. Mr Austin then picked up that envelope as well. He and Mr Harber then left the Gallery.
The law relating to personal service
"(3) A claim form is served personally on
(a) an individual by leaving it with that individual;"
The Rules provide no further guidance as to the interpretation of that provision.
"There is abundant authority for the proposition that personal service requires that the document be handed to the person to be served or, if he will not accept it, that he be told what the document contains and the document be left with or near him."
"Prima facie, the process server must hand the relevant document to the person upon whom it has to be served. The only concession to practicality is that, if that person will not accept the document, the process server may tell him what the document contains and leave it with him or near him."
i) whether a document will be considered to have been 'handed to' and accepted by the person to be served (within the first limb, requiring no explanation by the process server) if its nature is not apparent from the face of what is delivered, such as where (as in the present case) it is contained in an envelope with no explanation of its contents on its face;
ii) whether a document will be considered to have been 'handed to' or 'left with or near' the person to be served if it is subsequently taken away by the process server;
iii) whether, where an explanation of the contents of the document was required because the document was not accepted (the second limb), it is sufficient if the process server gave an explanation which would be understood by an English speaker, even if it was not in fact understood by the person to be served (an objective test as to whether he was 'told'), or whether it is an additional requirement that the explanation resulted in the person to be served having actual knowledge of the nature of the document (a subjective test as to whether he was 'told').
These issues are considered in turn below.
(i) Is a document 'accepted' if its nature is not apparent when it is delivered?
"Handing to a defendant a writ enclosed in an envelope, whether sealed up or not, the defendant not being informed of its contents, and having no knowledge that an action has been or is about to be commenced against him, is not good personal service."
" what is after all the essential thing in service cannot have been complied with, the essential thing being that the documents served shall be brought to the personal knowledge of the person whose concern it is In the case of a writ it could not be suggested, I venture to think, that mere proof of delivery of a sealed envelope containing the copy of the writ, or notice of the writ, would be sufficient service It is no exaggeration to say that the practice in regard to writs and the requirements of the law in regard to the service of writs are, and have always been, regarded as matters strictissimi juris. In the case of the service of a bankruptcy petition, I can see nothing in the section and Rules which can fairly be construed as relaxing the strict requirements which are to be found in the case of the service of writs and other documents under the Rules of the Supreme Court. I therefore hold that Mr Blagden's first point, namely, that mere proof of delivery of the documents in a sealed envelope without more would be sufficient, fails."
"I find it quite impossible to draw inferences of that kind in a matter of so strict a nature as service. It would be intolerable, and would lead to the gravest injustice, if a litigant who was desirous of bringing his opponent before the Court by proper process could satisfy the requirements of the law as to service by proving facts such as those and asking the Court thereon to draw an inference as to the crucial fact having happened, the crucial fact being the coming of the document into the hand of the person to be served in such manner that the nature of it is brought to his mind
I am not laying down any general rule as to the circumstances in which it may be possible to provide service notwithstanding delivery in a sealed envelope. For example, if the envelope were opened by the addressee in the presence of the server and the contents inspected, that would be one case."
"The purpose of the requirement that he be told is that he should not be able to say that he ignored the document on the grounds that it was simply junk mail or something which did not necessarily require his attention at all."
That reasoning applies with equal force to a recipient who has been handed (and has taken) an unmarked envelope: in the absence of any explanation or other basis for knowing what it contained he might discard it as junk mail without ever appreciating its contents required his attention.
(ii) Is a document 'left' if it is taken away by the process server?
"The Oxford English dictionary gives, as the primary meaning of the transitive verb 'to leave':
'To cause or let remain' and 'to depart without taking'
There appears to be a difference between those two nuances of meaning, in that one describes the mere process of allowing to remain, and the other introduces an element of departure without removal. It is understandable, given those alternative senses of the verb, that the judge should have found it a difficult point. Was the concept of 'leaving' a document introduced by the Rule to be regarded in the former sense or the latter?
Once the intended recipient (assuming him to have required knowledge of its nature) has been given a sufficient degree of possession of the document to enable him to exercise dominion over it for any period of time however brief, the document has been 'left with him' in the sense intended by the Rule."
(iii) Need the recipient understand the explanation of the document?
"The question in this case is whether the process server can be said to have told the appellant what the documents contained. The evidence, as we have seen, is that he said: "I have documents for you." It is accepted that the appellant was familiar with the process server from all the previous occasions on which he had been served, and that he must therefore have known that the documents related to this litigation in which he was involved.
With what degree of particularity does the rule require that the person served be told what the documents contain? In my judgment, one must look at this in a practical way. I think it is sufficient if it is brought to his attention that it is a legal document which requires his attention in connection with proceedings. The purpose of the requirement that he be told is that he should not be able to say that he ignored the document on the grounds that it was simply junk mail or something which did not necessarily require his attention at all. "
"If a person refuses to accept service of a document, personal service may be effected on him by putting the document down in his presence and telling him the nature of it."
"13. The question then is whether the respondent was informed of the nature of the document Although the word "nature" may be somewhat vague, it is clear that the rule is not very demanding ... Further, the person served need not be informed of the "nature" of the document orally ... Thus if the "nature" of the document is clear on its face and the document is not placed in an envelope or otherwise concealed, r 2(2) will be satisfied ...
14. I should also note that, whichever account [of what was said by the process server] is adopted, it is likely that the respondent would have been able to deduce the nature of the document served from his past dealings with the applicant in this Court, including contested proceedings regarding the bankruptcy notice. Thus, the conversation took place in a context where there was some element of assumed knowledge between the parties. In Taylor v Marmaras  VicLawRp 66;  VLR 476 it was decided that, where the person served knew the nature of the document from past history in relation to a matter, service would be valid despite the fact that the nature of the document was not clearly stated by the process server.
15. It also seems that, had Mr Elkateb not appreciated the importance of the document or been aware of its nature, he would not have known to file a notice of intention to oppose the petition "
The burden and standard of proof
Whether service was validly effected
(a) By Mr Austin, outside the Gallery
(b) By Mr Harber, inside the Gallery
(i) Whether the envelope was left with or near Mr Mikhelson
(ii) Whether Mr Mikhelson was told what the documents contained
i) Mr Mikhelson initially took hold of the envelope willingly and apparently without reservation, in what was at that stage a calm and civilised encounter with Mr Austin, who was smartly dressed and entirely polite and reasonable. It was only after asking his daughter what the envelope was that Mr Mikhelson loosened and then released his grip. Whilst nothing is picked up on the recording, I infer that Victoria Mikhelson told him, quietly and in Russian, what was happening. At the very least an indication appears to have been given that he should not accept the envelope.
ii) Mr Mikhelson then sought to ignore Mr Austin, telling his daughter not to listen to him. That would have been strange behaviour if Mr Mikhelson genuinely did not understand what Mr Austin was attempting to give to him, particularly as he accepted in his evidence that he appreciated that it was to do with his business.
iii) By the time the group entered the Gallery, Mr Austin had spoken directly to Victoria Mikhelson and made it plain that he had High Court papers for her father, something he repeated to Ms Mavica. It is inconceivable that that information would not have been communicated to Mr Mikhelson when he spoke with his daughter, Ms Mavica and his interpreter in the foyer of the Gallery, if he had not already been so informed.
iv) Mr Mikhelson's subsequent conduct, clearly attempting to evade the service of the envelope by Mr Harber and telling him to go away, confirms my conclusion that he knew that the envelope contained court papers.
v) Perhaps even more revealing is that other persons present were astute to ensure that the envelopes were not retained by anyone connected with Mr Mikhelson, demonstrating that word to that effect had been spread amongst the attendees.
vi) Mr Mikhelson, in his first statement (and to a lesser extent in his second), sought to explain his behaviour on the basis that he considered Mr Austin and Mr Harber had an aggressive demeanour and he felt threatened. The video recording does not support that characterisation. Mr Mikhelson further suggested that he had no understanding of what was taking place. However, there was nothing to prevent Mr Mikhelson asking Mr Austin, through his daughter or his interpreter, what he wanted. The clear and obvious inference is that he did not do so because he had already been told.
Mr Tseitline's application