Enyo’s Director of Business Intelligence, Paul Austin, was instructed to serve a claim form in the UK on Mr Mikhelson, a non-English speaking Russian national businessman domiciled in Russia.

Mr Mikhelson brought an application contesting service which was considered by Phillips J in the Commercial Court in Tseitline v Mikhelson and others [2015] EWHC 3065. The key issues considered by the Court were whether Mr Mikhelson had accepted the documents, whether the documents were left with him for a sufficient period for him to exercise control over the documents and whether he understood he was being served with legal documents.   

In this article, Paul Austin sets out the nature of the work carried out in advance of attempting to serve Mr Mikhelson including the extensive research and preparation. We also consider the judgment of Phillips J and suggest some practical issues solicitors should consider when attempting to serve potentially evasive recipients with proceedings or other court documents.  

Preliminary intelligence work 

The successful service of a claim form can make the difference between a case progressing smoothly to court or disintegrating amidst a tangle of procedural errors and tactical blunders.

All too often, the delivery of these vital documents is left in the hands of process servers who would struggle to deliver a postcard, let alone legal papers crucial to the outcome of a case and by failing to commit enough time and resources to service, lawyers jeopardise their cases and risk failing their clients.

At the most straightforward end of the spectrum, service entails delivering documents to an individual at an office or house and providing the recipient lives a relatively normal life, the chances are they will leave their house for work in the morning, spend the day at their office and return home in the evening, thus providing a number of opportunities for easy service.

Whilst this straightforward scenario should not present a problem regarding good service, case law is littered with examples of bad service with wrong addresses (Dzekova v Thomas Eggar LLP, [2015] EWHC 2600 (QB), photocopied claim forms (Hills Contractors and Construction Limited v Struth, [2013] EWHC 1693) and attempts to email claim forms (Barton v Wright Hassall Solicitors LLP, [2016] EWCA Civ 177) all conspiring to complicate a seemingly simple process.

The worrying issue for lawyers therefore is the thought of what happens when a globetrotting, security conscious oligarch must be served in the UK if the average process server is outwitted simply by trying to follow Part 6 of the CPR.

The most straightforward solution when faced with a complex service scenario is to simply bypass the buffoonery of the process servers and spend a decent amount of time and resources researching the individual you need to serve. The service element of Tseitline v Mikhelson and others [2015] EWHC 3065 required Mr Mikhelson to be served in the UK which was complicated by the fact he travelled frequently and it was impossible to build up a picture of his itinerary through public record research.

This is where ethically conducted business intelligence is crucial and in this scenario it enabled the client to know exactly where Mr Mikhelson was going to be on a particular date. Initial research had established he was a prominent figure in the art world and it was then possible, through additional discreet enquiries, to ascertain he was going to a guest of honour at an East End art gallery.

Such intelligence work should always take place behind the scenes of complex service scenarios to maximise the chances of success because without it, the whole process has very poor prospects of success.

Attempts at service

Based on intelligence obtained during the preliminary research pinpointing Mr Mikhelson’s whereabouts in London, myself and Mr Harber, (who was instructed to assist in the service), met Mr Mikhelson outside the Whitechapel Art Gallery each armed with an envelope containing a sealed copy of a claim form together with a certified Russian translation and supporting documents. Mr Harber also held a small camera with which to film events. There followed an attempt by each of us to serve Mr Mikhelson with the claim form.

First attempt: Outside the gallery, Mr Mikhelson briefly held the envelope jointly with me  

When Mr Mikhelson stepped out of his car I held out the envelope containing the claim form and informed him that I was serving papers as part of a High Court claim. Whilst I spoke, Mr Mikhelson held one side of the envelope while I continued to hold the other. However Mr Mikhelson, after speaking with his daughter (who spoke fluent English and acted as his interpreter), subsequently loosened his grip on the envelope before completely releasing it.

We subsequently followed Mr Mikhelson and his daughter to the entrance of the art gallery where I repeated that I was serving papers as part of a High Court action and needed to speak to him. Mr Mikhelson said in English that he spoke only Russian.

I then asked Mr Mikhelson’s daughter to give the documents to her father. Mr Mikhelson told her, in Russian, not to listen to me.

Second Attempt: Inside the gallery, the documents are on Mr Mikhelson’s person but they drop to the floor 

We followed Mr Mikhelson and his daughter into the art gallery where Mr Harber attempted to serve the envelope on Mr Mikhelson by lodging it in between his arm and his body. Mr Harber let go of the envelope at which point it either fell to the floor or was thrown on the floor by Mr Mikhelson. Mr Harber picked up the envelope and lodged it between Mr Mikhelson’s daughter’s back and handbag where it also fell to the floor.

Myself and Mr Harber then collected and left with our respective envelopes. We subsequently posted copies of the documents to various personal and business addresses of Mr Mikhelson in Russia.

Mr Mikhelson’s application for contesting service was brought on the grounds that he did not understand English and because the communications by me and Mr Harber were not translated he had no reason to suspect the papers had anything to do with English court proceedings. It was clear to me that based on Mr Mikhelson’s reactions, he was fully apprised of our intentions.

Decision

CPR 6.5 provides that a claim form is served personally on an individual by leaving it with that individual. The equivalent pre-CPR rule is set out in Kenneth Allison Ltd v A E Limehouse & CO [1192] 2 AC 105 which established a two-limb test requiring that either the document should be (1) handed to the person to be served; or if they will not accept it (2) that they are told what the document contains and the document be left with or near them.

In circumstances where the document is accepted by the recipient, the first limb of the test requires that the nature of the document be “immediately and readily apparent on its face” to avoid a situation where the recipient discards the document believing it to be junk mail or similar. Phillips J said it was difficult to see how a document could be accepted by a recipient if they did not know the nature of the document.     

Where the document is not accepted, the second limb of the test is engaged and the envelope must be left with or near the intended recipient. Phillips J held there was little doubt that Mr Harber’s actions amounted to leaving the documents with or near Mr Mikhelson as Mr Harber had relinquished control of the envelope. He said it was of no consequence we had taken the documents with us because Mr Mikhelson had sufficient control to exercise control over the envelope even for a brief period.

On the second limb, the recipient must also have acquired knowledge that they had been given a legal document which required their attention. Phillips J stated that whilst this is expressed as requiring the recipient to be told of the nature of the document, the focus is actually on the knowledge of the recipient. He specifically mentioned that such knowledge could be inferred from pre-existing knowledge, prior dealings or from conduct at the time of or after service including conduct in evading service.

Phillips J held that the proceedings were properly served on Mr Mikhelson inside the art gallery because the envelope was left sufficiently near him such that he had control of the documents. He said that could plainly be inferred from his actions that he had the requisite knowledge of the nature of the documents by his interactions with his daughter and his subsequent conduct in an attempt to evade service.

In respect of the first attempt, Phillips J noted counterfactually that in circumstances where I had released the envelope before Mr Mikhelson let go of it then valid service would have been effected outside the gallery because he had, at that time, acquired knowledge of the nature of the documents.

Analysis

This case emphasises the importance of obtaining reliable intelligence before attempting to serve potentially evasive individuals. Plainly, a failed attempt at service puts the intended recipient on notice that a party is seeking to serve proceedings and is likely to prompt steps by the intended recipient to further evade service and, depending on the nature of the proceedings, there is a risk evidence may be destroyed or assets dissipated.  

The necessity of specialist intelligence to mitigate the difficulties in complex service scenarios might advocate a move away from the traditional approach of employing process servers and, depending on the recipient, require experts to assist in serving those who are well versed in how to evade service.