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Setting aside a default costs certificate – learning from others' mistakes. Part Three: Serbian Orthodox Church – Serbian Patriarchy v Kesar & Co [2021] EWHC

Default Costs Certificates – Part III

In Serbian Orthodox Church – Serbian Patriarchy v Kesar & Co [2021] EWHC 1205 (QB) the Court was asked to address the validity of service of the Notice of Commencement of detailed assessment proceedings by email.

This was an appeal against Senior Master Gordon-Saker’s decision to set aside a Default Costs Certificate which had been obtained following service of the bill of costs using the “wrong” email address. The parties had agreed to accept service by email, however Kesar had used two email addresses during the course of the proceedings, despite only having agreed to accept service upon one of those addresses. Kesar had put arrangements in place for any emails that were sent to the address where deemed service had not been agreed (the “wrong” email address), to be forwarded to the deemed service email address. The court was therefore asked to determine whether this arrangement would be deemed to be effective service in the event of service on the “wrong email address”.

Senior Master Gordon-Saker rejected Kesar’s argument that there had been no agreement to accept service by email and did not consider that Kesar had shown good reason to set aside the DCC. He did however accept that service on the wrong email address did not constitute valid service. Consequently, the DCC was set aside.

The decision was appealed. Mr Justice Foxton agreed that service was not valid and was therefore asked to exercise his procedural discretion in determining whether to validate service, a review of CPR 3.10, CPR 6.15, CPR 6.27 and the related authorities followed. The Appellant advanced arguments that the court should make an Order under CPR 6.27 regarding validity of service and that there had been a “good reason”. It was argued that it was clear that the documents had been sent to an email address that the paying party had used, which automatically forwarded documents to the address which was in use, and this therefore constituted a “good reason”.  Mr Justice Foxton considered that this was a “good reason” and he found that service on this occasion was valid.

Once service was found to be valid, the court heard alternative arguments that the Senior Master should have set aside the DCC on a discretionary basis in any event, and consideration was given to whether there was any good reason for the failure to serve the points of dispute.

In that regard, it was accepted by the Respondent that Senior Master Gordon-Saker had properly directed himself as to the Denton test regarding his findings that there had been a significant default, and that there had been no good reason for the failure to act in time.

Mr Justice Foxton was however asked to consider whether the Senior Master had misapplied the third limb of the Denton test, which was the evaluation of all the circumstances of the case to enable the court to deal with the application justly. Following a review, which included noting the failure to serve points of dispute, it was held that the third limb of the Denton test had been applied correctly by Senior Master Gordon-Saker and he had neither misdirected himself in reaching this conclusion, nor taken account of an irrelevant matter in reaching his conclusion.

Summary

Mr Justice Foxton found that service, on this occasion, was valid as it was clear that the documents had been sent to an email address that the paying party had used, which automatically forwarded documents to the address which was in use.

He further found that the Denton test had been applied correctly by Senior Master Gordon-Saker. Consequently, Mr Justice Foxton ordered that the DCC stood.

Caroline Cousins is a Costs Lawyer and Deputy Civil Team Leader at A&M Bacon Ltd. Sue Fox is the Head of Costs Management at A & M Bacon Ltd.

Should you have any queries in relation to legal costs, please do contact our specialists and award-winning team on 01733 350 880 or by email at mail@aandmbacon.co.uk.

Published 25 June 2021

Author – Caroline Cousins

 

 

 

 

 

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