|[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]|
England and Wales High Court (Commercial Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Commercial Court) Decisions >> Aelf MSN 242, LLC v De Surinaamse Luchtvaart Maatschappij NV DBA Surinam Airways  EWHC 3482 (Comm) (21 December 2021)
Cite as:  WLR 2181,  1 WLR 2181,  WLR(D) 643,  EWHC 3482 (Comm)
[New search] [Context] [View without highlighting] [Printable PDF version] [Buy ICLR report:  1 WLR 2181] [View ICLR summary:  WLR(D) 643] [Help]
QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
(sitting as a Deputy Judge of the High Court)
| AELF MSN 242, LLC
(a Puerto Rico limited liability company)
|- and -
|DE SURINAAMSE LUCHTVAART MAATSCHAPPIJ N.V. D.B.A. SURINAM AIRWAYS
Tom Stewart Coats (instructed by Bird & Bird LLP) for the Defendant
Hearing dates: 26th November 2021
Crown Copyright ©
Peter MacDonald Eggers QC :
"We also attach an exchange of emails between the Defendant and the Court. It appears that no Acknowledgment of Service has been accepted by the Court.
In any event, the form of Acknowledgment of Service we have seen is defective in that it does not include a proper address for service in the jurisdiction.
Accordingly, please enter a default judgment.
If there is any doubt about whether a default judgment should be entered, we should be grateful if you could place this letter and attachments before a judge, with a request that the judge direct whether or not a default judgment should be granted."
"Following Bryan J's order of 14.4.21, the AoS was due within 22 days after service on 3.6.21, hence by 25.6.21. The file indicates that the AoS was emailed to court on 25.6.21 but CE filed only at 14:51 on 28.6.21. A Request for default judgment was purportedly filed at 09:33 on 28.6.21 but rejected and refiled on 30.6.21. It therefore appears that the AoS, if valid, would have been filed before the Request for CPR 12.3(1) purposes.
The AoS was defective as it did not contain, as an address for service, a business address for a solicitor (or other residential or business address) in the UK or other EEA state. It therefore did not comply with CPR 10.5(b), read with CPR 6.23(2), and as per note 10.5.5 should have been rejected as irregular. Other things being equal, the Claimant would be entitled to enter a default judgment on expiry of the deadline for filing of the AoS (25.6.21).
However, on 8.7.21 English solicitors, Bird & Bird, filed a notice of change indicating that they had been instructed to act on behalf of D, stating an address for service within the jurisdiction. Bird & Bird the following day filed an application for an extension of time for D to serve its Defence. In these circumstances it might be argued that the defect in the AoS, namely the [specification of] an address for service in the jurisdiction, has been superseded by the provision of such an address in the notice of change. Although I have some doubt about the strength of any such argument, in the circumstances which have arisen it appears to me that it would not be appropriate to enter judgment in default without first giving the parties an opportunity to address this matter. I therefore invite both parties to file and serve any submissions by 4pm on Monday 26.7.21, indicating also whether either of them seeks an oral hearing. Pending resolution of this issue, the application for an extension of time to serve a Defence should be adjourned and the court should not enter judgment in default of Defence."
"7. It is the Defendant's position that these proceedings were required to be served on the Defendant in accordance with section 12(1) of the State Immunity Act 1978 which provides that "any writ or other document required to be served for instituting proceedings against a State shall be served by being transmitted through the Foreign, Commonwealth and Development Office to the Ministry of Foreign Affairs of the State and service shall be deemed to have been effected when the writ or document in received at the Ministry".
8. It is the Defendant's position that, although it is a "separate entity" for the purposes of section 14 of the State Immunity Act, these proceedings relate to an act done by the Defendant in the exercise of the Republic of Suriname's sovereign authority. As a result, these proceedings were required to be served under the procedure set out in section 12(1) of State Immunity Act. Since they were not, there has been no valid service on the Defendant."
"I agree that it would be unfortunate if these issues, including the claimed entitlement to judgment in default, were all to have to wait a year to be determined. My provisional view is that the following course of action should be taken.
The Claimant's application for judgment, the Defendant's application for an extension of time for its Defence, the Defendant's application for relief from sanctions, and the Defendant's application disputing jurisdiction/service, should be listed for hearing on a date later on this term with a time estimate of half a day.
However, so far as concerns the jurisdiction/service application, the hearing this term will address only the question of whether the Defendant is precluded from disput[ing] jurisdiction or challenging service by reason of having submitted to the jurisdiction as alleged by the Claimant.
The balance of Defendant's jurisdiction application, in the event that it remains extant, will have to be addressed at a later date (formally by way of adjournment of the hearing this term), bearing in mind that (a) that application may require service of substantive evidence and (b) in any event, it seems unlikely that it could be dealt with (along with the other applications mentioned above) at a half day hearing, that being the longest fixture the court could accommodate this term. The parties may retain the current listing for 22 June 2022 to cater for that eventuality, subject to any further direction made by the judge hearing the applications this term.
The hearing this term will, if necessary, be listed regardless of the availability of particular counsel "
(1) AELF's request for entry of judgment in default.
(2) SLM's application to challenge jurisdiction based on invalidity of service but limited to the issue whether SLM has submitted to the jurisdiction.
(3) SLM's application for an extension of time for filing its acknowledgment of service and for relief from sanctions.
(4) SLM's application for an extension of time for its Defence.
(1) SLM's application for an extension of time for filing its acknowledgment of service and relief from sanctions.
(2) AELF's contention that SLM is precluded from disputing the Court's jurisdiction or challenging service by reason of its submission to the Court's jurisdiction.
The relevant provisions of the Civil Procedure Rules
"(1) A party to proceedings must give an address at which that party may be served with documents relating to those proceedings. The address must include a full postcode unless the court orders otherwise
(2) Except where any other rule or practice direction makes different provision, a party's address for service must be
(a) the business address within the United Kingdom of a solicitor acting for the party to be served; or
(c) where there is no solicitor acting for the party
(i) an address within the United Kingdom at which the party resides or carries on business
(3) Where none of sub-paragraphs (2)(a) or (c) applies, the party must give an address for service within the United Kingdom
(5) Where, in accordance with Practice Direction 6A, a party indicates or is deemed to have indicated that they will accept service by fax, the fax number given by that party must be at the address for service.
(6) Where a party indicates in accordance with Practice Direction 6A that they will accept service by electronic means other than fax, the e-mail address or electronic identification given by that party will be deemed to be at the address for service
(8) This rule does not apply where an order made by the court under rule 6.27 (service by an alternative method or at an alternative place) specifies where a document may be served
(For service out of the jurisdiction see rules 6.40 to 6.47.) "
"Neither of these provisions alters the requirement that the party, where a solicitor's address is not given, must if he has one, give an address within the United Kingdom at which the party resides or carries on business, that is, a physical address. To comply with the rule a party may not give just a fax number or email address for example as the actual address for service although the party may be willing to be served by those means. Where the party has indicated that it will accept service by transmission of a fax, the rule requires that the fax number given must be at the address for service. In a case in which the party has indicated a willingness to be served by electronic means other than fax, the email address or electronic identification given by that party will be deemed to be at the address for service."
"Subject to the provisions of rule 6.23(5) and (6), where a document is to be served by fax or other electronic means
(1) the party who is to be served or the solicitor acting for that party must previously have indicated in writing to the party serving
(a) that the party to be served or the solicitor is willing to accept service by fax or other electronic means; and
(b) the fax number, e-mail address or other electronic identification to which it must be sent; and
(2) the following are to be taken as sufficient written indications for the purposes of paragraph 4.1(1)
(a) a fax number set out on the writing paper of the solicitor acting for the party to be served;
(b) an e-mail address set out on the writing paper of the solicitor acting for the party to be served but only where it is stated that the e-mail address may be used for service; or
(c) a fax number, e-mail address or electronic identification set out on a statement of case or a response to a claim filed with the court."
"(1) A defendant who wishes to
(a) dispute the court's jurisdiction to try the claim; or
(b) argue that the court should not exercise its jurisdiction
may apply to the court for an order declaring that it has no such jurisdiction or should not exercise any jurisdiction which it may have.
(2) A defendant who wishes to make such an application must first file an acknowledgment of service in accordance with Part 10.
(3) A defendant who files an acknowledgment of service does not, by doing so, lose any right that he may have to dispute the court's jurisdiction "
(4) An application under this rule must
(a) be made within 14 days after filing an acknowledgment of service; and
(b) be supported by evidence.
(5) If the defendant
(a) files an acknowledgment of service; and
(b) does not make such an application within the period specified in paragraph (4),
he is to be treated as having accepted that the court has jurisdiction to try the claim "
"On an application for relief from any sanction imposed for a failure to comply with any rule, practice direction or court order, the court will consider all the circumstances of the case, so as to enable it to deal justly with the application, including the need
(a) for litigation to be conducted efficiently and at proportionate cost; and
(b) to enforce compliance with rules, practice directions and orders "
Application for extension of time and relief from sanctions
The parties' submissions
(1) SLM's First Acknowledgment was filed, or at least attempted to be filed, within time and in conformity with CPR Part 10.
(2) CPR rule 10.5(b) provides that an acknowledgment of service must include the defendant's address for service. A note to that rule refers to CPR rule 6.23 which makes provision for addresses for service after proceedings have been started.
(3) The First Acknowledgment did not include a physical address for service within the United Kingdom, but where the defendant provides an email address for service, in accordance with CPR rule 6.23(6) and CPR Practice Direction 6A, paragraph 4.1, that email address constitutes a sufficient address for service for the purposes of CPR rule 10.5(b). Although this argument was presented in writing, it was not repeated during oral argument, at least not with emphasis.
(4) On 14th April 2021, Bryan, J had ordered that the Claim Form, the Particulars of Claim "and any other document in these proceedings" could be served on SLM in Surinam. Accordingly, any requirement that an address for service in the United Kingdom be stated in the acknowledgement of service form was overridden by this order, having regard to CPR rule 6.23(8). This argument was presented by Mr Stewart Coats orally, but not in writing.
(5) The case for an extension of time is overwhelming in circumstances where:
(a) SLM attempted, as an unrepresented litigant, to file its First Acknowledgment in time and was only unable to do so because it emailed rather than e-filed the acknowledgment of service. Indeed, whilst SLM accepts that CPR PD 51O required the acknowledgment of service to be e-filed, the notes for a defendant in the response pack provided to SLM stated that the acknowledgment of service must be completed and sent to "Admiralty and Commercial Registry, The Rolls Building, 7 Rolls Building, Fetter Lane, London, EC2A 1NL".
(b) If there was a defect in the First Acknowledgment, it was a technical and unintentional defect and SLM clearly intended to provide physical and electronic addresses for service.
(c) SLM and its solicitors only became aware that the First Acknowledgment was potentially defective as a result of an email from the Court dated 22nd July 2021.
(6) To the extent SLM requires relief from sanctions, or the principles relevant to relief from sanctions apply by analogy, SLM's application should succeed by reference to the three-stage test in Denton v TH White Ltd  EWCA Civ 906;  1 WLR 3296.
(a) Whether the non-compliance was serious or significant: in this case, the non-compliance was not significant since SLM successfully filed its First Acknowledgment the next working day after the deadline for filing and it filed its Second Acknowledgment promptly after notification by the Court that there was doubt as to the validity of the First Acknowledgment.
(b) Reasons for non-compliance: SLM's non-compliance was innocent, understandable, and promptly remedied. As to the First Acknowledgment, SLM attempted to file a valid acknowledgment of service in time and was only prevented from doing so by a misunderstanding of how the document was to be filed and (if it is correct that the First Acknowledgment was defective) an innocent failure to provide a physical address for service within the United Kingdom. As to the Second Acknowledgment, SLM filed this shortly after it was notified by the Court (and not by AELF) that the First Acknowledgment might not be valid.
(c) All the circumstances of the case: SLM should not be precluded from running a jurisdictional objection which has important consequences not just in this case but also more generally merely because it was slightly delayed in filing an acknowledgment of service despite its efforts to do so.
(1) SLM has not satisfied the conditions precedent under CPR Part 11 for challenging service. SLM has not satisfied the requirement in CPR rule 11.2 to "first file an acknowledgment of service in accordance with Part 10". As at the date it issued the application notice, SLM had not filed a regular acknowledgment of service. Further, the acknowledgment of service which it did eventually file was not filed within the relevant time fixed by CPR rule 10.3 (Taylor v Giovani Developers Ltd  EWHC 328 (Comm), para. 14-16; Cunico Resources FZE v Daskalakis  EWHC 3382 (Comm) paragraph 34, 94; White Book, para. 11.1.5).
(2) SLM can, therefore, only pursue its application to challenge the Court's jurisdiction if it is able to persuade the Court to extend time for filing its acknowledgment of service and for relief from sanctions, both in relation to the fact that it did not first file an acknowledgment of service before issuing its application and in relation to the late filing of the acknowledgment of service. Any such relief should be refused.
(3) The Court must exercise its discretion in accordance with the overriding objective, taking into account all the circumstances of the case, so as to deal justly with the application and including the specific matters identified in CPR rule 3.9(1), namely the need (a) for litigation to be conducted efficiently and at proportionate cost and (b) to enforce compliance with rules. It is established that the Court will apply the principles in Denton v TH White Ltd  EWCA Civ 906;  1 WLR 3296.
(4) The acknowledgment of service (the Second Acknowledgment) was filed 32 days late against the permitted time of 22 days - more than double the time permitted - and it was filed after the issue of the application to challenge the Court's jurisdiction. This is a serious and significant default. See Taylor v Giovani Developers Ltd  EWHC 328 (Comm), where a delay of 64 days compared to 21 days was serious and significant (para. 20); and Cunico Resources FZE v Daskalakis  EWHC 3382 (Comm) where a delay of 28 days compared to 21 days was held to be substantial (para. 116(i)). The significance of the delay is the greater given that AELF had, prior to service of the acknowledgment of service, applied for and should have been granted judgment in default.
(5) Moreover, both breaches are unexplained. Ms Simona Peter of Bird & Bird gives no proper explanation for the lengthy delay in filing a regular acknowledgment of service. In particular, she gives no explanation as to (i) why SLM failed to file a regular acknowledgment of service within time; and (ii) why it took from 8th July until 27th July 2021 for Bird & Bird, having come on the record, to file a regular acknowledgment of service and issue the application for an extension of time and relief from sanctions.
(6) As to (i), the only explanation given is that SLM did not have an address in England and had not instructed solicitors in England. That is no explanation at all. Ms Peter does not explain why SLM had not instructed solicitors in England sooner, or why it apparently took until 8th July 2021 for them to do so. SLM knew it had been served with proceedings taking place in England as is evident from an email exchange on 2nd June 2021 (the jurisdiction having been chosen by the parties in the Settlement Agreement signed only the previous year) and must have appreciated the need to act expeditiously. Yet there is no explanation as to why SLM apparently did nothing about the proceedings at all until its first failed attempt to file an acknowledgment of service on the last permitted date, 25th June 2021, and why it failed to instruct English solicitors until 8th July 2021.
(7) As to (ii), the application appears to have been prompted by the Court's email dated 22nd July 2021 and notice of AELF's application for default judgment. There is no explanation why the defect in the acknowledgment of service was not appreciated sooner given that it is plain on the face of the document and it would have been known that SLM had no address in the jurisdiction and had not already instructed solicitors. Further, even having apparently appreciated on 22nd July 2021 that no regular acknowledgment of service had been filed, SLM chose to issue and serve its application challenging jurisdiction before, several days later, filing the Second Acknowledgment. For this, there is no explanation at all.
(8) There is, therefore, no good explanation for the default.
(9) There is no explanation for the change from the First Acknowledgment which stated that SLM intended to defend the claim (and did not state that SLM intended to contest jurisdiction) to the Second Acknowledgment which stated that SLM intended to contest jurisdiction (as noted in paragraph 12 of the second witness statement dated 3rd August 2021 of Mr Steven Loble on behalf of AELF).
(10) Further, the purpose of the application for an extension of time is to enable SLM to challenge the Court's jurisdiction based on an argument that service was not effected in accordance with section 12(1) of the State Immunity Act 1978. That application is, however, bound to fail. Section 12(1) applies only to "States" as defined in section 14 of the 1978 Act. SLM is not a State; it is a separate entity within the meaning of section 14. Indeed, SLM's own evidence expressly states as much (paragraph 8 of the witness statement dated 23rd July 2021 of Mr John Vrede). It is a very short point and SLM's contention is obviously unsustainable. It is permissible for the Court to take into account the merits of the jurisdiction challenge in deciding whether to accede to the application for an extension of time, where the merits or lack of merits are so plain as to warrant summary judgment (HRH Prince Abdulaziz Bin Mishal Bin Abdulaziz Al Saud v Apex Global Management Ltd  UKSC 64;  1 WLR 4495, para. 29-31; R (Hysaj) v Secretary of State for the Home Department  EWCA Civ 1633;  1 WLR 2472, para. 46-48).
(11) In addition, SLM agreed that service should be effected upon it by the Bailiff and Mr Vrede (SLM's Manager of Legal Affairs) made the appointment to accept service by email dated 2nd June 2021. Accordingly, even if SLM were a State (which it plainly is not), service would have been effective under section 12(6) of the State Immunity Act 1978.
(12) It is manifest (not least given the position adopted by SLM in the Surinam Court) that the application disputing jurisdiction is no more than a delaying tactic in the absence of any grounds for a defence.
(13) It is contrary to the need for litigation to be conducted efficiently and at proportionate cost to extend time and relieve SLM from sanctions in order to enable it to bring an abusive application which is doomed to fail and which, if permitted to proceed, will cause and is intended to cause significant further delay to the proceedings. That is particularly so where, as here, the debt has been publicly acknowledged by SLM, there is no suggestion of any arguable defence and AELF should already have been granted judgment in default.
(14) The Court should therefore dismiss the application for an extension of time and relief from sanctions.
"94. I have already said I agree with, and so I am happy to follow, Taylor's case in deciding that under CPR r 11(2) it is a procedural requirement of an application under CPR r 11(1) to challenge jurisdiction that the defendant first file a timely acknowledgment of service. That means filing either within the time period set under CPR Pt 10 or within an extended period fixed by the court on a successful application (prospective or retrospective) for an extension.
95. Therefore, Mr Daskalakis is not entitled to challenge jurisdiction in the 2018 claim unless he is granted either a retrospective extension of 28 days for filing acknowledgment of service, to cover his lateness in doing so, or relief from sanctions by a waiver of CPR r 11(2)
115. Mr Choo-Choy accepted that pursuant to the "implied sanction" doctrine, an out-of-time application for an extension of time for filing acknowledgment of service is to be determined by reference to relief from sanctions principles under CPR r 3.9 and Denton v TH White Ltd  1 WLR 3926 "
(1) First, the Court must identify and assess the seriousness and significance of the "failure to comply with any rule, practice direction or court order". If the failure is not serious or significant, the Court should generally grant the relief from sanctions, although it should still consider all of the circumstances of the case in the exercise of its discretion.
(2) Second, the Court must consider why the default occurred and the explanation for the default provided.
(3) Third, the Court must evaluate all the circumstances of the case, so as to enable the Court to deal justly with the application including the objectives referred to in CPR rule 3.9(1)(a) and (b).
(1) SLM sought to file its acknowledgment of service with the Admiralty and Commercial Registry within the time specified by Bryan, J's order, albeit on the final day of this period.
(2) The acknowledgment of service was rejected by the Court on Friday 25th June 2021 because it was purportedly filed by email and not e-filed. This lapse occurred against a background of SLM not having yet retained English solicitors and the Response Pack required the acknowledgment of service to be returned to the Admiralty and Commercial Registry. The failure to instruct solicitors earlier is a ground of criticism by AELF, but there is no obligation on a defendant to instruct solicitors and in circumstances where it lacks the benefit of legal advice within the forum, it is reasonable - even if possibly misguided - for a defendant to comply with the instructions included in the Response Pack.
(3) Immediately after receiving notification of the rejection, SLM e-filed the First Acknowledgment on Monday 28th June 2021, the next business day.
(4) The First Acknowledgment did not include a physical address within the United Kingdom but did include a physical address in Surinam as well as an email address. Contrary to SLM's submissions, I consider that this did not comply with CPR rule 6.23, because rule 6.23(2)-(3) requires an address to be specified which is within the United Kingdom; rule 6.23(5)-(6) do not alter this requirement in that rule 6.23(5) requires the fax number to be located at the physical address within the United Kingdom and rule 6.23(6) deems the email address to be at the physical address for service. Indeed, the acknowledgment of service form states that "the business address of your solicitor or your own residential or business address within the UK " should be included (although I note that the form does not allow for the third possibility contemplated by CPR rule 6.23(3)). Further, I do not consider that Bryan, J's order permitting service of the Claim Form, the Particulars of Claim "and any other document in these proceedings" on SLM in Surinam is concerned with the provision of an address for service under CPR rule 6.23, but with the service of originating process (and associated documents), and not with any document in the proceedings, such as all application notices. In addition, this order was not an order for service by an alternative method as contemplated by CPR rule 6.23(8).
(5) Even though the physical and email addresses included in the First Acknowledgment did not comply with CPR rule 6.23, they still provided an effective means by which documents and applications could be served on and communicated to SLM. Indeed, CPR rule 6.23(6) and CPR Practice Direction 6A, paragraph 4.1 contemplate that service at an email address is a permitted method of service on a party to the proceedings.
(6) SLM was not aware of the defect in the First Acknowledgment in not including a physical address within the United Kingdom until 22nd July 2021 (see Part C of SLM's application for an extension of time to file an acknowledgment of service and relief from sanctions). SLM then issued its Second Acknowledgment, curing this defect, on 26th July 2021.
(7) There is no delay comparable to the delays of 64 days and 28 days, which were regarded as serious or significant, respectively in Taylor v Giovani Developers Ltd  EWHC 328 (Comm), para. 20 and Cunico Resources FZE v Daskalakis  EWHC 3382 (Comm);  1 WLR 2881, para. 116(i). The First Acknowledgment was filed on the first business day after the expiry of the 22 day period allowed for filing of the acknowledgment of service and the Second Acknowledgment was filed four days after SLM became aware of the defect in the First Acknowledgment.
Is SLM precluded from disputing jurisdiction by reason of a submission to jurisdiction?
SLM's application to dispute the Court's jurisdiction
The parties' submissions
(1) The defective First Acknowledgment filed on 28th June 2021 ticked the box indicating an intention to defend the claim (not to challenge the service of the court) and, on 9th July 2021, SLM issued an application for an extension of time to serve its Defence. The evidence in support of the application (Part C of the application notice) acknowledged that the proceedings had been served on SLM on 3rd June 2021 and that SLM had filed an acknowledgment of service noting its intention to defend the claim. The evidence also stated that SLM had instructed Bird & Bird to prepare a Defence but that SLM was not in a position to serve its Defence by the deadline of 9th July 2021 because Bird & Bird had only been instructed on 8th July 2021. Bird & Bird had written to W Legal requesting an extension of time but W Legal had been unable to take instructions in the short time available. Accordingly, SLM applied for an extension of 21 days to file its Defence.
(2) The Defendant thereby acted, objectively, inconsistently with an intention to challenge service and submitted to the jurisdiction. See White Book, para. 11.1.10 and Global Multimedia International Ltd v ARA Media Services  EWHC 3612 (Ch), para. 27-31.
(3) Further, in order to obtain a discharge of a freezing injunction obtained by AELF in Surinam, SLM expressly relied upon the fact that the English Court has exclusive jurisdiction to determine the claims and that these proceedings are pending before the English Court by reason of service of the Claim Form on SLM in Surinam (see paragraphs 2-5 of the second witness statement of Mσnica Millαn dated 18th November 2021 and the exhibited translation of SLM's submission to the Surinam Court dated 28th September 2021, where it was said on behalf of SLM, in reliance on the exclusive English jurisdiction agreement, that "On 3 June 2021 the SLM was summoned to appear before the English court. As is evident from the documents of the case, in order for its claim to be allowed before the English court, AELF explicitly invoked the aforesaid irrevocable and exclusive choice of forum").
(1) In IMS SA v Capital Oil & Gas Industries Ltd  EWHC 1956 (Comm), it was explained that any challenge to jurisdiction (including those based on non-service or defective service) should proceed by way of the CPR Part 11 procedure.
(2) In Deutsche Bank AG London Branch v Petromena ASA  EWCA Civ 226, the Court of Appeal explained that that there are two different ways in which a defendant might submit to the jurisdiction: (a) the first, categorised as "common law waiver", requires the doing of an act inconsistent with maintaining a challenge to the jurisdiction; such a waiver must clearly convey an unequivocal renunciation by the defendant of its right to challenge the jurisdiction; (b) the second, categorised as a "statutory form of submission", is where the national procedural rules provide that a particular act shall be treated as a submission.
(3) The present case is concerned only here with "common law waiver" since SLM's challenge to the jurisdiction was made: (i) within 28 days after filing its First Acknowledgment; and (ii) shortly prior to its Second Acknowledgment. It therefore cannot be said that SLM is deemed to have submitted to the jurisdiction pursuant to CPR rule 11(5).
(4) As to common law waiver, in SMAY Investments Ltd v Sachdev  EWHC 474 (Ch), it was stated that notification of intention to defend in an acknowledgment of service can only become an unequivocal submission to jurisdiction if the defendant fails to issue an application challenging jurisdiction within the time limit prescribed by CPR rule 11(4) or indicates to the Court in clear and express terms that it has abandoned his intention to contest jurisdiction.
(5) The Court of Appeal also summarised the relevant test in Deutsche Bank AG London Branch v Petromena ASA  EWCA Civ 226, where Floyd LJ said at para. 32 that a common law waiver "must clearly convey to the claimant and the court that the defendant is unequivocally renouncing his right to challenge the jurisdiction, and the application of a bystander test is plainly apt".
(6) There has been no unequivocal renunciation of SLM's right to challenge the validity of the service on it in this case for the following reasons:
(a) The mere fact that an unrepresented litigant ticks the box on an acknowledgment of service indicating that it intends to defend the claim should not, at least while the period for a challenge to jurisdiction is extant, amount to an unequivocal renunciation of the litigant's right to challenge jurisdiction.
(b) If (as AELF maintains), the First Acknowledgment is invalid, it cannot then be used by AELF as a basis for saying that SLM has submitted to the jurisdiction.
(c) SLM's application for an extension of time for its Defence was made very shortly after its solicitors, Bird & Bird, came on the record and in circumstances where: (i) AELF's solicitors, W Legal, had failed to inform Bird & Bird that a request for default judgment had been made; (ii) W Legal had failed to inform Bird & Bird that AELF challenged the validity of the First Acknowledgment; and (iii) W Legal had failed to properly engage with Bird & Bird's informal request for an extension. The application for an extension was clearly intended to be a protective measure to avoid a default judgment being entered whilst Bird & Bird were reading into the case and it was not a clear expression of SLM's intention to abandon any challenge to jurisdiction.
(d) Once SLM's solicitors had had a proper opportunity to consider the position, an application to challenge the validity of service was made promptly.
"27. The test to be applied in determining whether any particular conduct amounts to a submission to the jurisdiction was considered by Colman J. in Spargos Mining NL v Atlantic Capital Corporation  reported only in "The Times" for 11th December, but quoted in full by Patten J. in SMAY Investments Ltd. v Sachdev  1WLR 1973 at p.1976. I reproduce the whole of the quote as set out in that paragraph 41 from the Judgment of Patten J:
"In approaching the question of submission, I have in mind the following authorities. In Astro Exito Navagacion S.A. v. W.T. Hsu, otherwise know, more pronounceably, as The 'Messiniaki Tolmi',  1 Lloyds Reports, 266, Lord Justice Goff (as he then was) at page 270, said this:
'Now a person voluntarily submits to the jurisdiction of the Court if he voluntarily recognizes, or has voluntarily recognized, that the Court has jurisdiction to hear and determine the claim which is the subject matter of the relevant proceedings. In particular, he makes a voluntary submission to the jurisdiction if he takes a step in the proceedings which in all the circumstances amounts to a recognition of the Court's jurisdiction in respect of the claim which is the subject matter of those proceedings. The effect of a party's submission to the jurisdiction is that he is precluded thereafter from objecting to the Court exercising its jurisdiction in respect of such claim. Whether any particular matter, for example an application to the Court, amounts to a voluntary submission to the jurisdiction must depend upon the circumstances of the particular case.'
In Sage v. Double A Hydraulics Ltd,  Times Law Reports, 165, Lord Justice Farquharson said (and this is a report of the judgment which is not reported in oratio recta):
'A useful test was whether a disinterested bystander with knowledge of the case would have regarded the acts of the Defendant, or his solicitors, as inconsistent with the making and maintaining of his challenge.'
In arriving at the view to be imputed to the disinterested bystander, it seems to me that one has to bear in mind that there will be an effective waiver, or a submission to the jurisdiction, only where the step relied upon as a waiver, or a submission to the jurisdiction, cannot be explained, except on the assumption that the party in question accepts that the court should be given jurisdiction. If the step relied upon, although consistent with the acceptance of jurisdiction, is a step which can be explained also because it was necessary or useful for some purpose other than acceptance of the jurisdiction, there will, on the authorities, be no submission.
If the well-informed bystander had been left in doubt because what the defendants had done was equivocal, in the sense that it was explicable on other grounds in addition to agreement to accept the jurisdiction of the court, then the conclusion must be, on the authorities, that there would have been no submission to the jurisdiction. The representation derived from the conduct of the party said to have submitted must be capable of only one meaning."
28. Thus the test to be applied is an objective one and what must be determined is whether the only possible explanation for the conduct relied on is an intention on the part of the defendant to have the case tried in England
30. I can express my conclusion quite shortly. I will assume for the purposes of the argument that both orders for service had been improperly made so that Mr. Aljadail did have grounds for challenging the jurisdiction of the court. I also recognise that solicitors instructed to advise and represent the client in relation to a claim such as this have little time to determine whether to contest the jurisdiction. Consequently, in cases of doubt the solicitor would be well advised to tick box 3 on the acknowledgement of service and obtain an extension of time under Rule 11(4) without delay. If he genuinely wishes to preserve his client's ability to contest the jurisdiction of the court he will refrain from entering on the merits of the claim or at least only do so on a clear and express without prejudice basis.
31. The solicitor for Mr. Aljadail adopted none of these courses. To any objective outside observer his conduct, and accordingly that of Mr. Aljadail from the giving and receipt of instructions on 3rd April to the letter of 10th May - a period of over five weeks - was only consistent with an acceptance of the jurisdiction of the court to determine the claims of AMS on their merits. A defendant who intends to challenge the jurisdiction of the court does not seek an extension of time for his defence, he does not advance a defence on the merits in the form of the settlement agreements, nor does he threaten to strike-out the claim if the claimant refuses to discontinue it In my judgment Mr. Aljadail had submitted to the jurisdiction before his solicitor's letter of 10th May was sent, and before his application for an extension of time was issued on 23rd May 2006 "
"40. One would have thought that, with the advent of the CPR, we could finally have adopted an all embracing and exhaustive code for dealing with challenges to jurisdiction and assigned to history arguments about implied waiver and submissions to jurisdiction, which seem to me to be an affront to any mature legal system. As it is, it still appears to be open to argument, and it has been argued in this case, that by placing a tick in the wrong box and by obtaining, necessarily or unnecessarily, an extension of time for a defence, the first defendant has waived his right to apply for a stay.
41. It seems to me that when a defendant has complied with CPR Pt 11 with a view to challenging the jurisdiction of the court, and the time for making his application under CPR r 11(4) has not yet expired, then any conduct on his part said to amount to a submission to jurisdiction, and therefore a waiver of that right of challenge, must be wholly unequivocal "
"42. That was a case in which the defendants applied unsuccessfully to set aside service of the writ outside the jurisdiction. After judgment was handed down the parties asked the court to give directions for the service of pleadings and for discovery. The directions were given. The defendants did not make any application for leave to appeal the refusal to set service aside, nor was there any reservation of their position on jurisdiction. When they subsequently applied for leave to appeal, Colman J held that, by seeking and obtaining directions in the manner I have described, there had been a submission to the jurisdiction. Such conduct was only explicable on the basis that they intended to have the case tried in England. The same conclusion, in similar circumstances, was reached in In re A Company (No 002015 of 1996)  2 BCLC 1.
43. In the present case, however, the first defendant's conduct was anything but unequivocal. He indicated in the affidavit sworn on 5 December and served prior to the hearing on 6 December that he intended to contest jurisdiction. Mr Deacon indicated to Peter Smith J that the full inter partes hearing would involve a contest on jurisdiction, and the undertakings offered were only until that effective hearing. Therefore the only order sought and obtained by the first defendant from the judge on 6 December which was in any way inconsistent with the challenge to jurisdiction being maintained was the extension of time for service of the defence. That was strictly unnecessary, see CPR r 11(9), but it can only operate as an unequivocal submission to the jurisdiction if the only possible explanation for it is an intention on the part of the first defendant to have the case tried in England. In making that assessment the court cannot ignore the background circumstances as they were on 6 December. The acknowledgment of service had not yet been filed and the position was therefore as set out in the affidavit of 5 December and in counsel's skeleton argument. It is true that when the first and third defendants did later file acknowledgments of service on 16 December, these had the "intention to defend" box ticked, but they also indicated that these defendants intended to contest jurisdiction, and the notification of an intention to defend was therefore at best equivocal. Given the assertions by the first defendant in his affidavit about a challenge to the jurisdiction and the subsequent affirmation of that position in the acknowledgment of service, the position, in my judgment, could only have become unequivocal either by his failure to issue an application challenging jurisdiction within the time limit prescribed by CPR r 11(4) or by his indicating to the court in clear and express terms that he had abandoned his intention to contest jurisdiction. Neither of these events occurred. In so far as the extension of time for a defence was sought and obtained, that is not inconsistent with a continuing intention to challenge jurisdiction. On the contrary, it seems to me equally consistent with a desire to postpone any obligation to serve a defence until after the issue of jurisdiction had been determined."
"27. Farquharson LJ delivered the judgment of the court, which also included Lord Donaldson MR and Stocker LJ. In a passage dealing with the law applicable to both appeals, he said:
"The danger inherent in the defendant doing anything further after [the defendant] has issued a summons to set aside, lies in the risk that he may be taken to have waived his right to challenge the writ or the court's jurisdiction. It is necessary in each case to determine whether any step taken, looked at objectively, falls into this category. A useful test is whether a disinterested bystander with knowledge of the case, would regard the acts of the defendant (or his solicitor) as inconsistent with the making and maintaining of a challenge to the validity of the writ or to the jurisdiction."
28. Applying this disinterested bystander test to the facts of the Sage case, the court regarded the issue of a summons seeking an extension of time, in the period when there was no extant challenge to the jurisdiction, as an act inconsistent with the maintenance of such a challenge. The challenge to the validity of the writ therefore failed
32. The Sage case was a case of what one might call common law waiver, the doing of an act inconsistent with maintaining a challenge to the jurisdiction. Such a waiver must clearly convey to the claimant and the court that the defendant is unequivocally renouncing his right to challenge the jurisdiction, and the application of a bystander test is plainly apt "
(1) A defendant will be precluded from disputing the Court's jurisdiction if the defendant voluntarily recognises or has voluntarily recognised that the Court has jurisdiction to hear and determine the claim, that is if the defendant voluntarily submits to the Court's jurisdiction.
(2) The defendant makes such a voluntary submission to the jurisdiction if the defendant takes a step in the proceedings which in all the circumstances amounts to a recognition of the Court's jurisdiction.
(3) There will be a submission to the jurisdiction where the defendant's conduct cannot be explained, except on the basis that the defendant accepts that the Court has jurisdiction. That is, the defendant's conduct must be unequivocal in submitting to the jurisdiction in order to deprive the defendant of its right to apply to dispute the Court's jurisdiction. This is especially the case where, at the time of the relevant conduct alleged to amount to a submission to jurisdiction, the defendant has issued an application to contest jurisdiction within time or the time for filing such an application has not yet expired. Of course, if the defendant has not applied to contest jurisdiction within the requisite time, it will be treated as having accepted that the Court has jurisdiction pursuant to CPR rule 11(5) (this is a statutory submission to the jurisdiction, as opposed to a common law waiver: Deutsche Bank AG London Branch v Petromena ASA, para. 36).
(4) If the defendant's conduct is both consistent with the acceptance of jurisdiction but also can be explained because it was necessary or useful for some purpose other than the acceptance of the jurisdiction, there will be no submission to the jurisdiction.
(5) Examples of conduct which might amount to a submission to the jurisdiction include the defendant applying for an extension of time in which to serve a defence or advancing a defence on the merits or threatening to strike out the claim (other than on the grounds of the Court's lack of jurisdiction). It is worth noting that under the now repealed Rules of the Supreme Court and an earlier version of CPR rule 11, the time within which an application to dispute jurisdiction had to be made was defined by reference to the period within which a defence had to be served. Now under CPR rule 11(4) the application to dispute jurisdiction must be within 14 days after filing of an acknowledgment of service, although in the Commercial Court the period is 28 days after filing of an acknowledgment of service (CPR rule 58.7(2)). Therefore, whereas an application for an extension of time in which to serve a defence may have been equivocal at least under the Rules of the Supreme Court, given that the effect of the application was to extend time in which to apply to dispute jurisdiction, this consideration no longer applies under the current version of CPR rule 11 (The Burns-Anderson Independent Network plc v Wheeler  EWHC 575 (QB);  1 Lloyd's Rep 580, para. 30-34). However, where the relevant conduct is accompanied by a clear statement that it is without prejudice to the defendant's challenge to, or right to challenge, the Court's jurisdiction, that is likely - although not necessarily, as it depends on the facts - forestall a submission to the jurisdiction (SMAY Investments Ltd v Sachdev; Winkler v Shamoon  EWHC 217 (Ch)). Similarly, where the defendant has indicated an intention to dispute jurisdiction in its acknowledgment of service, that will often - but again it depends on the facts - be sufficient to prevent a defendant from being treated as having submitted to the jurisdiction.
(6) The mere indication of an intention to defend the claim, as opposed to an indication of an intention to contest the Court's jurisdiction, in ticking or checking the relevant box in the acknowledgment of service form is of itself not sufficient to amount to a submission to jurisdiction, without additional conduct which demonstrates an unequivocal intention to submit to the jurisdiction, such as failing to apply to dispute the Court's jurisdiction within the requisite time period imposed by the Civil Procedure Rules or a statement or conduct which is fundamentally inconsistent with such an intention to dispute jurisdiction. This is made plain by CPR rule 11(3) which provides that "A defendant who files an acknowledgment of service does not, by doing so, lose any right that he may have to dispute the court's jurisdiction".
(7) The timing of the conduct alleged to constitute a submission to the Court's jurisdiction is important. If the conduct took place before an application contesting the Court's jurisdiction was intimated or issued, then it is more likely to be an unequivocal submission to the jurisdiction; if the relevant conduct occurred whilst there was a pending application to contest the Court's jurisdiction or a reservation of the right to do so, then it is unlikely, perhaps very unlikely, to constitute a submission to the jurisdiction (see e.g. Zumax Nigeria Ltd v First City Monument plc  EWCA Civ 567;  1 CLC 953, para. 44-51). In each case, however, it is dependent on an examination of all of the facts.
(8) The assessment of the defendant's conduct must be undertaken objectively, sometimes said to be from the perspective of the disinterested bystander.
(1) The fact that in its First Acknowledgment SLM indicated its intention to defend the claim and did not indicate its intention to dispute jurisdiction. However, AELF accepts that it could not rely on this conduct alone in support of SLM's submission to jurisdiction, but it could rely on this conduct together with additional conduct by SLM.
(2) The fact that on 8th July 2021 SLM applied for an extension of time in which to serve its Defence (a day before the expiry of the time period for the service of the Defence set by Bryan, J's order dated 14th April 2021).
(3) The fact that SLM had represented to the Surinam Court, in September 2021, that the English Court had been seised of jurisdiction by reason of the exclusive English jurisdiction agreement in the Settlement Agreement between the parties and the service of process on SLM on 3rd June 2021.
"On 3 June 2021, the Claimant served on the Defendant the Claim Form, Particulars of Claim and order of Mr Justice Bryan (dated 14 April 2021) (the "Directions Order") out of the jurisdiction. The Directions Order provided that the Defendant would have 36 days from the date of service of the Claim Form (together with the Particulars of Claim) within which to serve a Defence.
The Defendant, at the time unrepresented, filed an Acknowledgment of Service noting its intention to defend the claim on 25 June 2021. Bird & Bird LLP came on the record on 8 July 2021 and filed a Notice of Change at 18:16 on 8 July. A copy of the Notice of Change was served on the Claimant's legal representative, W Legal Ltd, immediately thereafter.
Pursuant to CPR Part 15.5(1), the Defendant's solicitors, Bird & Bird LLP requested a 21 day extension for filing of the Defence (i.e. until 30 July 2021) in its letter to W Legal Ltd sent on 8 July 2021 at 15:28. Bird & Bird LLP has only come on the record and been instructed to prepare a defence on 8 July 2021. Given that this firm was only instructed the day before the current deadline for filing of the Defence, the Defendant is not in a position to comply with this deadline.
At the time of making this application, the Claimant has not responded substantively to the Defendant's request for an extension of time. W Legal Ltd responded to Bird & Bird's letter of 8 July stating that it would be "able to communicate further" once Bird & Bird has come on the record. Since service of the Notice of Change on W Legal Ltd, Bird & Bird LLP requested a response to the extension request by email on 8 July 2021 at 18:21 and again on 9 July 2021 at 8:49. Mrs Simona Peter of Bird & Bird LLP also left a voice message for Mr Loeb at W Legal Ltd at 10:18 on 9 July. At 11:20 on 9 July 2021 Mr Loeb of W Legal informed Mrs Peter that the Claimant is based in a different time zone and that he had no instructions on the extension request and that he is unlikely to receive these until the afternoon of 9 July. Given the imminent expiry of the deadline for filing the defence, the Defendant is making the application pending substantive response from the Claimant in this regard.
As a timetable for the proceedings is yet to be fixed, the Defendant does not consider that the Claimant would suffer any prejudice if the extension of time is granted (particularly as this application is being made before the expiry of the present deadline for filing the Defence). The extension sought therefore has no impact on any trial given that none has been fixed."
(1) The Claim Form, the Particulars of Claim and Bryan, J's order were all served on SLM out of the jurisdiction.
(2) SLM - before instructing solicitors - had filed its First Acknowledgment stating its intention to defend the claim.
(3) SLM had instructed Bird & Bird as its solicitors in these proceedings by 8th July 2021.
(4) SLM was unable to serve its Defence by 9th July 2021, as directed by Bryan, J.
(5) SLM therefore required further time in which to serve its Defence.
(6) Bird & Bird on behalf of SLM requested AELF to agree to an extension of time for the service of its Defence.
(7) SLM made the application for an extension pending a response from AELF to SLM's request for an extension.
(8) The granting of an extension would impose no prejudice on AELF and had no impact on any trial as no trial had yet been fixed.
"The application to extend time for service of the Defence was made shortly after the Defendant had instructed Bird & Bird to act for it in relation to these proceedings and was a protective measure to safeguard the Defendant's position. For the avoidance of doubt, the Defendant did not thereby intend to submit to the jurisdiction of the Court or waive any right to challenge the validity of the purported service on it."
Section 12(3) of the State Immunity Act 1978
"(1) Any writ or other document required to be served for instituting proceedings against a State shall be served by being transmitted through the Foreign, Commonwealth and Development Office to the Ministry of Foreign Affairs of the State and service shall be deemed to have been effected when the writ or document is received at the Ministry.
(2) Any time for entering an appearance (whether prescribed by rules of court or otherwise) shall begin to run two months after the date on which the writ or document is received as aforesaid.
(3) A State which appears in proceedings cannot thereafter object that subsection (1) above has not been complied with in the case of those proceedings.
(4) No judgment in default of appearance shall be given against a State except on proof that subsection (1) above has been complied with and that the time for entering an appearance as extended by subsection (2) above has expired.
(5) A copy of any judgment given against a State in default of appearance shall be transmitted through the Foreign, Commonwealth and Development Office to the Ministry of Foreign Affairs of that State and any time for applying to have the judgment set aside (whether prescribed by rules of court or otherwise) shall begin to run two months after the date on which the copy of the judgment is received at the Ministry.
(6) Subsection (1) above does not prevent the service of a writ or other document in any manner to which the State has agreed and subsections (2) and (4) above do not apply where service is effected in any such manner."
(1) The phrase "appears in proceedings" in section 12(3) meant that, under the Civil Procedure Rules, a defendant must have acknowledged service and must not have applied to challenge jurisdiction within the requisite time period. See L v Y Regional Government of X  EWHC 68 (Comm), para. 56-60.
(2) It follows that the filing of the First Acknowledgment on 28th June 2021 was not an appearance within the meaning of section 12(3).
(3) As SLM filed an application to contest jurisdiction within the requisite time period, it cannot be taken to have appeared in the proceedings within the meaning of section 12(3).
(4) A State cannot appear in proceedings within the meaning of section 12(3) by reason of a common law waiver, because that would be contrary to the statutory purpose of section 12(3), which should be construed narrowly, in contrast to the broad construction to be given to section 12(1) (General Dynamics United Kingdom Ltd v State of Libya  UKSC 22, para. 43, 58).
(5) By contrast, sections 2(1)-(3) of the 1978 Act refer to a submission to jurisdiction, which is wide enough to embrace a common law waiver. If the intention of the parliamentary draftsperson had been to use the same concept in section 12(3), the same language would have been used.
"59. Under the CPR the functional equivalent of entering an (unconditional) appearance under the RSC 1978 is therefore filing an acknowledgment of service and failing to make an application disputing the court's jurisdiction within the requisite period.
60. The obviously sensible construction of section 12(3) given the changes in civil procedure since 1978 is to hold that a state "appears" in proceedings when it files an acknowledgment of service and does not issue an application to dispute the court's jurisdiction within the requisite period.
61. The word "appears" is sufficiently broad to be construed in this manner.
62. If necessary, the same conclusion can be reached by giving section 12(3) an updated construction
63. As the NML Capital case [NML Capital Ltd v Argentina  UKSC 31;  2 AC 495] makes clear, the SIA is not one of those rare acts which is meant to be of unchanging effect. So far as necessary, it should be given an updated meaning to allow for procedural changes since it was enacted. In the present case that means construing "appears" in section 12(3) in the manner set out above."
"In my judgment the claimant's "Catch 22" construction of section 12(3) cannot be correct. It should be construed in the manner set out above. That is consistent with the statutory purpose of section 12, namely, to confer an important procedural right on state entities, which can be foregone either: (i) by doing the functional equivalent of entering an unconditional appearance under the old rules of procedure, or (ii) by an agreement to an alternative method of service. It is also in accordance with the fundamental feature of the scheme of CPR Pt 11, namely, that a "defendant who files an acknowledgment of service does not, by doing so, lose any right that he may have to dispute the court's jurisdiction": CPR r 11(3)."
"(1) A State is not immune as respects proceedings in respect of which it has submitted to the jurisdiction of the courts of the United Kingdom.
(2) A State may submit after the dispute giving rise to the proceedings has arisen or by a prior written agreement; but a provision in any agreement that it is to be governed by the law of the United Kingdom is not to be regarded as a submission.
(3) A State is deemed to have submitted
(a) if it has instituted the proceedings; or
(b) subject to subsections (4) and (5) below, if it has intervened or taken any step in the proceedings."
"The terms employed by section 12 SIA include those associated with the Rules of the Supreme Court as they existed at the time of the enactment of the statute in 1978. Subsection (1) refers to a writ and the following subsections also refer to entering an appearance and judgment in default of appearance, matters which have long been superseded in civil procedure in this jurisdiction. The interpretation section of the SIA provides in section 22(2) that references to entry of appearance and judgments in default of appearance include references to any corresponding procedures. The precise application of section 12 to more modern procedures has on occasion given rise to difficulty. (See Norsk Hydro, AIC Ltd v Federal Government of Nigeria (2003) 129 ILR 571, Fox and Webb, The Law of State Immunity, pp 234-235.) However, it was clearly not the legislative intention to limit the procedure for service under section 12(1) to cases involving the entry of appearance and possible judgments in default, or to corresponding procedures, as is demonstrated by the reference in section 12(1) to an "other document required to be served for instituting proceedings against a state"."