In our previous article from 6 April 2020 (which can be found here), we analysed the risks of businesses missing time sensitive documents in the post during the COVID-19 lock down and the steps you could take to avoid this. On 26 June the High Court in Stanley v London Borough of Tower Hamlets set aside a judgment in default (of the Defendant's acknowledging service of defending the claim) which had been obtained during the lock down period.
Timeline of events:
January – the Claimant sent the Defendant a formal letter before claim. The Defendant did not respond.
February – during a telephone conversation between the party's lawyers, the Defendant had indicated that legal proceedings had to be served by post.
23 March - Defendant's office closed.
25 March - proceedings posted to the Defendant.
27 March - claim form deemed served on the Defendant.
9 April -deadline for acknowledgment of service (which the Defendant did not file).
15 April - request for default judgment filed with the Court.
17 April - judgment entered against the Defendant.
The Defendant then applied to set aside the judgment and applied for relief from sanctions on the basis that:
- it had a real prospect of successfully defending the claim and/ or
- there was "some other good reason" to set aside the judgment, this being that it was unreasonable for the solicitor for the Claimant to have served proceedings during lock down.
The Court agreed with the Defendant.
Notwithstanding the fact that the Defendant's solicitor had requested service by post in February, the Court held that the Claimant's solicitor should have acted responsibly by contacting the Defendant to acknowledge that the situation regarding the pandemic had changed since February, and should have sought to discuss how the claim could best be served by alternative means. The Court held that the Claimant would have known, or should have known, that the Defendant's office had closed and therefore not received or reviewed for some time.
Whilst the Defendant's failure to file an acknowledgment of service or defence was a serious and significant default, the circumstances surrounding that failure were "unique". The Civil Procure Rules Practice Direction 51ZA made it compulsory for the Court to consider the impact of the pandemic when considering the application.
We expect this is the first of many similar cases to come over the next few months. This case demonstrates that it is unlikely that the Courts will allow parties to take advantage of the pandemic by serving documents at offices which they know (or ought to know) are closed. Whilst the lockdown has eased somewhat, parties should still consider the steps they can take to limit the risk of missing time sensitive documents (please see our earlier article linked above).