Phoenix Healthcare – time is of the essence

Woodward & Another v Phoenix Healthcare [12.06.19]

Following on from our August 2018 article 'Phoenix Healthcare – here we go again', judgment was handed down yesterday by the Court of Appeal.

The facts

For those unfamiliar with the facts, the claimant’s solicitors, Collyer Bristow, served proceedings on Phoenix’s solicitors, Mills & Reeve, without seeking confirmation that Mills & Reeve were authorised to accept service.

The proceedings had been issued at the very end of the limitation period. Service was delayed, to allow time for the particulars of claim to be finalised. The net result was that proceedings were purportedly served just one day before the time for service expired. Mills & Reeve wrote to Collyer Bristow the following day pointing out that service of the proceedings was defective.

At first instance, Master Bowles retrospectively validated service, finding that Mills & Reeve were under a duty pursuant to the Civil Procedure Rules (CPR) Part 1.3 (advancing the overriding objective) to warn Collyer Bristow that its purported service was defective, such that good service could have been effected in time and that this failure constituted the deliberate playing of a technical game.

The decision was reversed on appeal by his Honour Judge Hodge, who found that: “the culture introduced by the CPR does not require a solicitor who has in no way contributed to a mistake on the part of his opponent, or his opponent’s solicitors, to draw attention to that mistake. That is in my judgement, not required by CPR1.3 and it does not amount to technical game playing”.

Decision on appeal

On appeal, the Court of Appeal found that there was no scope to argue that His Honour Judge Hodge was wrong to hold that the Master had erred in finding that Phoenix’s conduct was contrary to the overriding objective.

In reaching this decision, the court had particular regard to the fact that the considerations under CPR r 6.15 (the rules governing service of proceedings) are “rather different” from those which empower the court to waive compliance with procedural conditions or the “ordinary consequences of non-compliance”.

Rule 6.15 was directed specifically to the rules governing service of a claim form “and are simply conditions upon which the court will take cognisance” and “do not impose duties, in the sense in which, say, the rules governing the service of evidence, impose a duty”.

Lady Justice Asplin in giving the leading judgement observed that Lord Sumption in Barton v Wright Hassall [2018] had “made it clear that even if there had been time to warn, the defendant’s advisers were under no duty to give advice, they could not have done so without taking instructions and it was inconceivable that they would have been authorised to do so, and that a person having courted disaster by waiting until the very end of the limitation period to serve the claim form has only a very limited claim to the court’s indulgence and by comparison the prejudice in losing an accrued limitation defence is palpable. It seems to me that the emphasis placed upon the prejudice which would arise and the lack of duty to warn in such circumstances is entirely consistent with a positive duty under CPR r 1.3.”

Consistent with this finding the court did not accept there had been any technical game playing on the part of Phoenix and/or their representatives.

In the words of the court: “It is hard to see that taking the point that service was invalid, as in Barton, together with acting in a proper professional manner in researching the position, advising the client and taking their instructions can be recast as 'technical games'.”

Comment

The decision confirms that there is no duty on the part of a defendant to point out any procedural irregularity in relation to the service of proceedings, notwithstanding the fact that this may lead to a claim becoming statute barred.

Clearly, this is welcome news to those habitually defending claims. From a claimant’s perspective it emphasises the need to be clear as to: (1) who is authorised to accept service; (2) what methods of service are acceptable; and last but by no means least (3) the deadline for service. Claimants who “court disaster” by leaving service until the very last minute do so at their own risk.

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