THE COURT SETS ASIDE AN ORDER EXTENDING TIME FOR SERVICE OF THE CLAIM FORM: ACTION AGAINST THAT DEFENDANT DISMISSED

One of the issues considered by Mrs Justice Bacon in Vauxhall Motors Ltd & Ors v Denso Automotive UK Ltd & Ors [2025] EWHC 213 (Ch) was whether an order extending time for service of the claim form should be set aside.  She held that the order should be set aside. Consequently the claim against that particular defendant was dismissed.  The cases shows an important lesson in relation to the dangers of obtaining orders to extend time.  Those orders can be set aside. The relevant principles are considered in detail in this judgment.

“The real reason that the claimants needed an extension of time was therefore not the reasons given in the claimants’ May 2023 evidence, but rather the fact that the claimants had decided not to take steps to serve proceedings until April 2023. That was a matter wholly within the claimants’ control. As the authorities cited above make clear, a claimant’s own delay in preparing its case and commencing steps for service is not a good reason for an extension of time.”

THE CASE

The claimants brought an action alleging damage was caused as a result of cartels in which the defendant were said to be involved. The claimants issued proceedings against a number of defendants.  There was an agreement to extend time for service of the claim form.  In relation to one defendant, Valeo, the claimant obtained an order extending time for service of the claim form.  That defendant applied for an order setting aside the extension of time.

THE RELEVANT PRINCIPLES CONSIDERED

The judge considered the principles and case law relating to extensions of time in detail.

“Extension of time under CPR r. 7.6(2)

1. 1. CPR r. 7.5(2) provides that where the claim form is served within the jurisdiction, the defendant must be served in accordance with the rules in CPR Part 6 section IV, within six months of the date of issue.

1. 1. CPR r. 7.6 permits the claimant to apply to extend that period, as follows:

“(1) The claimant may apply for an order extending the period for compliance with rule 7.5.

(2) The general rule is that an application to extend the time for compliance with rule 7.5 must be made –

(a) within the period specified by rule 7.5; or

(b) where an order has been made under this rule, within the period for service specified by that order.

(3) If the claimant applies for an order to extend the time for compliance after the end of the period specified by rule 7.5 or by an order made under this rule, the court may make such an order only if –

(a) the court has failed to serve the claim form; or

(b) the claimant has taken all reasonable steps to comply with rule 7.5 but has been unable to do so; and

(c) in either case, the claimant has acted promptly in making the application.

(4) An application for an order extending the time for compliance with rule 7.5 –

(a) must be supported by evidence; and

(b) may be made without notice.”

1. 1. PD 7A sets out the evidence required for an application under r. 7.6:

“11.1 An application under rule 7.6 (for an extension of time for serving a claim form under rule 7.6(1)) must be made in accordance with Part 23 and supported by evidence.

11.2 The evidence should state –

(1) all the circumstances relied on,

(2) the date of issue of the claim,

(3) the expiry date of any rule 7.6 extension, and

(4) a full explanation as to why the claim has not been served.”

1. 1. The conditions for the grant of an extension of time are thus less stringent for an application made in time under r. 7.6(2) than for an application made out of time under r. 7.6(3). For an application made out of time, where it is the claimant rather than the court which has failed to serve the claim form, the extension of time may only be granted where the court is satisfied that all three conditions set out in r. 7.6(3) are satisfied, and in particular that the claimant has taken all reasonable steps to serve in time, but has been unable to do so. By contrast, where the application is made within time, those conditions are not specified, and the claimant is therefore not required to show that it has taken all reasonable steps to serve within time. Rather, the court’s power to extend the time must be exercised in accordance with the overriding objective: Hashtroodi v Hancock [2004] EWCA Civ 652, [2004] 1 WLR 3206, §§17–18; Al-Zahra v DDM [2019] EWCA Civ 1103, §49.

1. 1. The following considerations emerge from the authorities as to the considerations which are relevant in the exercise of the court’s discretion in the application of r. 7.6(2):

i) It follows from the overriding objective that civil litigation should be undertaken and pursued with proper expedition. Parties are therefore required to progress their proceedings promptly and within the specified time limits: see Vinos v Marks & Spencer [2000] 3 All ER 784, §20. Until the claim form is served, the court has no influence over the proceedings and cannot ensure that cases are dealt with expeditiously and fairly. The service of the claim form is therefore essential in order to (i) notify the defendant that the claimant has embarked on the formal process of litigation; (ii) enable the defendant to participate in the litigation; and (iii) enable the court to control the litigation: Hoddinott v Persimmon Homes (Wessex) [2007] EWCA Civ 1203, [2008] 1 WLR 806, §54.

ii) It will always be relevant for the court to determine and evaluate the reason why the claimant did not serve the claim form within the specified period: Hashtroodi, §18. What may be a sufficient reason for an extension of time for service of particulars of claim may not necessarily be a sufficient reason for an extension for service of the claim form: ST v BAI [2022] EWCA Civ 1037, §62(ii).

iii) If there is a very good reason for the failure to serve within time, then an extension of time will usually be granted. By contrast, the court is unlikely to grant an extension of time if no good reason has been shown for the failure to serve within the relevant period: Hashtroodi, §18; Hoddinott, §54; ST v BAI, §62(ii) and (iii).

iv) In general, the reason for seeking an extension of time must be a genuine difficulty in serving within time, rather than the consequences of the claimant’s own neglect: Hashtroodi, §18; and Cecil v Bayat [2011] EWCA Civ 135, §49. The claimant’s own delay in preparing its case, such as a delay in drafting the particulars of claim, is therefore not a good reason for an extension of time: Euro-Asian Oil v Abilo [2013] EWHC 485 (Comm), §37.

v) While an extension of time might be justified to enable the claimant to avoid the expense of serving out in circumstances where there is “real and substantial progress in settlement negotiations”, it is not sufficient for the claimant to say that it is waiting for the defendants to make or accept an offer of settlement: The Hai Hing [2000] 1 Lloyds Rep 300, pp. 308–309; Euro-Asian Oil, §28; and see ST v BAI, §62(ii).

vi) It is important to consider whether the limitation period has or may have expired since the commencement of proceedings, such that the extension of time would or may deprive the defendant of a limitation defence. If that is the case the claimant should show, at the very least, that it has taken reasonable steps to effect service, and that an extension of time is justified by factors which are, either separately or cumulatively, “out of the ordinary”: Cecil v Bayat, §48; ST v BAI, §§62(iv) and 63.

vii) If the claim form has been sent to the defendant such that it has brought to the defendant’s attention the nature of the claims, that is a factor relevant to the court’s discretion under r. 7.6(2), even if sending a copy of the claim form did not constitute service: Hoddinott, §57. In Cecil v Bayat at §88, Rix LJ characterised Hoddinott as an “exceptional” case where the defendant had received the claim form (even if not by formal service) within the period for service and the claim was still well within its limitation period, such that the defendant suffered no prejudice by reason of the extension of time. He noted, however, that in the great majority of cases an extension would only be granted where a good reason has been supplied.”

THE EXTENSION OF TIME IN THE CURRENT CASE

The judge then applied the principles to the facts of this case. She found that there was no good reason for granting an extension. The failure to serve within the original period was due to problems primarily of the claimant’s own making.  The order was set aside and the action against Valeo dismissed.

Extension of time for service on Valeo

The parties’ submissions

1. 1. The extension of time issue applies only to Valeo, the other defendants having consented to extensions of time to 1 January 2024 and (in the case of the third defendant) 1 April 2024.

1. 1. In respect of Valeo, the extension of time agreed by consent expired on 1 September 2023, and Valeo did not thereafter consent to a further extension of time. Without the extension of time granted on 11 May 2023, therefore, the claimants would have had to reissue their claims. By then the limitation period under domestic law (to the extent that is relevant) had expired; and on the claimants’ own case the limitation periods under French, German, Italian and Brazilian law had also expired. Valeo would therefore have been entitled to defend any reissued claim on the basis that it was time-barred. That does not appear to be disputed by the claimants.

1. 1. On that basis the claimants have to show that they had taken reasonable steps to effect service, and that there was a good reason for their failure to serve within the agreed extended time period based on factors that were out of the ordinary.

1. 1. The claimants say that they did take steps to commence the process of service out prior to the 1 September 2023 deadline, and that they were justified in waiting to take those steps in light of their attempts to reach settlements with the various defendants. Valeo objects that service could easily have been effected prior to the deadline if the claimants had taken the steps to do so earlier, and says that there were in fact no settlement discussions between the claimants and Valeo between issue of the claim form and the 11 May 2023 extension order. Valeo also contends that there were material and non-innocent breaches of the duty of full and frank disclosure by the claimants in seeking that extension order.

Steps taken to effect service

1. 1. The claim form was issued on 7 March 2022. On the claimants’ own evidence, they did not decide to serve the proceedings until April 2023, the decision to (finally) serve being taken on the basis that settlements had not been concluded with any of the defendants other than Calsonic and Panasonic. Prior to that date, it is apparent that no steps at all were taken by the claimants to serve the proceedings.

1. 1. The claimants did, after their decision to serve, then take steps to do so by serving the service-in defendants, and preparing service packs for service on the service-out defendants, depositing them at the Foreign Process Section of the High Court. By then, however, the latter steps were too late, as it was very unlikely that the service-out defendants would be served within the original 1 September 2023 deadline (as proved, in fact, to be the case: the service-out defendants were eventually served between 20 September 2023 and 18 March 2024).

1. 1. Mr West KC, for the claimants, said that it was sufficient that steps were taken to serve prior to the 1 September 2023 deadline. He relied on the judgment of Teare J in JSC BTA Bank v Ablyazov [2011] EWHC 2988 (Comm), upholding an order extending time for service on the second defendant in Russia. In that case, prior to the expiry of validity of the claim form, the claimant had commenced the process of preparing notarised translations of the relevant documents, which were then delivered to the Foreign Process Section shortly after the claim form would have (but for the extension of time) expired. The judge considered that there was a good reason to extend time, namely the long period of time required to effect service in Russia, notwithstanding a delay of “a month or more” in commencing the process of preparing the notarised translations for service out of the jurisdiction (§§28–29).

1. 1. The circumstances of that case were, however, very different to the present case. At the time the claim form was issued, the claimants believed that they would be able to serve in the jurisdiction on the second defendant’s solicitors, Olswang, who were instructed by the second defendant in several other related proceedings. The claimant repeatedly asked Olswang whether they were instructed to accept service of the new proceedings on behalf of the second defendant. It was only two and a half months later that the claimants were informed by Olswang that they were not instructed to accept service. Teare J considered that until that point the claimant had a good reason for not serving out on the second defendant (§24). Thereafter, he thought that the claimant should have taken steps to serve, notwithstanding the fact that without prejudice discussions were ongoing between the claimant and the second defendant (§28). He noted, however, that although there had been a delay of a month or more in commencing the process by the claimant, an extension of time would inevitably have been needed because of the very much longer period of time required to effect service in Russia (§§28–30).

1. 1. In the present case, the delay in commencing the process of serving out of the jurisdiction was not a matter of months, but was more than a year. It is difficult to see how on any basis that can be regarded as the taking of reasonable steps to effect service, having regard to the requirement to progress litigation expeditiously. Moreover, unlike the Ablyazov case, this is not a case where it is apparent that a further lengthy extension of time would have been needed in any event for service out of the jurisdiction on the Valeo defendants. Those defendants were all served on 8 December 2023, within six months of the service packs being deposited at the Foreign Process Section. The extensions of time initially agreed by the defendants had given the claimants almost 18 months to serve the proceedings. There is no suggestion in the evidence that the proceedings could not have been served on the Valeo defendants within that period, if reasonable steps had been taken to do so from the outset.

Reasons for the delay

1. 1. Nor is there, in my judgment, any good reason for the claimants’ delay. I will start with the reasons given in the claimants’ evidence in support of their May 2023 application for an extension of time for service on Valeo and Mahle-Behr, in the form of a witness statement from Mr Bolster, a partner at Hausfeld, the claimants’ solicitors. Valeo contends that the evidence given in that witness statement was undermined by material non-disclosures. I do not, however, need to reach any view on that because it is in my judgment clear that the reasons given by Mr Bolster were, on their face, simply not good enough to justify the extension of time sought.

1. 1. The first reason was that the claimants had had to prepare particulars of claim to be served within the period of validity of the claim form. That was not, in itself, a reason why the claimants could not serve proceedings by 1 September 2023. The extended time period agreed with the defendants had given the claimants ample time to prepare those particulars following issue of the claim form.

1. 1. The second reason was that there had been backlogs caused by a cyber-attack on Royal Mail in early 2023, affecting its overseas delivery services, which might lead the Foreign Process Section to take several months to dispatch the documents for service to the relevant foreign authorities. It is clear, however, that this was not the real reason why the claimants were unable to serve by 1 September 2023. The cyber-attack did not occur until mid-January 2023, over nine months after the claim form was issued. Had reasonable steps been taken to serve the proceedings after issue of the claim form, there is no reason why the documents for service could not have been deposited with the Foreign Process Section long before the cyber-attack occurred. There is no explanation at all (let alone a good explanation) of why a delay of a few months, which might have arisen from the cyber-attack, prevented service of proceedings in the 18-month period between issue of the claim form and the extended deadline of 1 September 2023.

1. 1. The third reason was that service on Valeo and Mahle-Behr in France and Germany might take around three months from receipt of the documents by the French and German authorities, and that Hausfeld had been told that the average time for service in Japan was four months from receipt of the documents by the Japanese authorities (but that Mr Bolster understood that it might take longer). Again, however, there is no reason why those periods could not have been accommodated within the extended service period agreed by the defendants, had reasonable steps been taken to commence service promptly after issue of the claim form.

1. 1. The final reason given was that the other defendants had consented to an extension of time for service to 1 January 2024, and that the extension would align the dates for service on all of the defendants which would simplify the subsequent steps in the proceedings. That is manifestly not a reason why service by 1 September 2023 was “unlikely to be possible”. Indeed, it is not a coherent reason for an extension of time on any basis. Given that the defendants were being served in a variety of different jurisdictions, by different authorities, the alignment of the deadlines for service could not ensure that the dates of actual service on the various defendants were aligned. Nor would that have been a good reason for an extension of time in any event, given that it was perfectly possible for the parties to agree a timetable for subsequent procedural steps to ensure efficient case management, once the defendants had all been served (as in fact occurred).

1. 1. The real reason that the claimants needed an extension of time was therefore not the reasons given in the claimants’ May 2023 evidence, but rather the fact that the claimants had decided not to take steps to serve proceedings until April 2023. That was a matter wholly within the claimants’ control. As the authorities cited above make clear, a claimant’s own delay in preparing its case and commencing steps for service is not a good reason for an extension of time.

1. 1. Mr West said that the reason why the claimants waited to start the process of service on the defendants was that they were endeavouring to resolve the proceedings without formal litigation, in circumstances where there were ongoing settlement discussions with the defendants, which did in fact lead to settlements with Panasonic and Calsonic before the claim form was served on them (and with Mahle-Behr shortly after it was served). At the hearing, however, Mr Kennelly KC, for Valeo, disputed the existence of any settlement discussions with Valeo specifically. Further evidence on this was therefore provided after the hearing, in the form of witness statements from Mr Bolster, for the claimants, and Mr Bock, a partner at Cleary Gottlieb, Valeo’s solicitors.

1. 1. It is apparent from that further evidence that there were no contacts between the claimants and Valeo that could properly be characterised as settlement discussions, in the period between issue of the claim form and 11 May 2023, the date of the extension of time order. What in fact happened was that:

i) Immediately following issue of the claim form, the claimants wrote (separately) to all of the defendants, informing them of the claim and proposing an extension of the period for service to 1 September 2023 to allow the parties to engage in settlement negotiations.

ii) On 15 April 2022 an individual at Valeo heading the thermal system sales contacted his counterpart at Stellantis objecting to the claim and requesting that it be withdrawn. The Stellantis contact responded on 2 June 2022 informing him that any questions should be directed to Hausfeld.

iii) On 13 June 2022 Valeo consented to the extension of time for service. It did not, however, engage in any settlement discussions with the claimants.

iv) On 5 January 2023 the claimants sent a without prejudice letter to Valeo, providing a large volume of claimant sales data for the purposes of advancing settlement discussions. Valeo did not respond to that letter.

v) On 18 April 2023 there was a telephone call between Mr Bolster and Mr Bock, initiated by Mr Bolster, in which the claimants’ request for a further extension of time and the scope for settlement discussions was discussed. Mr Bolster made an attendance note of that call, which records Mr Bock’s position as being that Valeo was unlikely to agree a further extension of time for service. Mr Bolster apparently commented that the claimants were “still waiting to hear from [Valeo] on the data and that that is a normal starting point for [settlement] discussions”. It is common ground that this was a reference to the data provided in January 2023, and the fact that Valeo had not responded to that. Mr Bock’s response (according to the attendance note) was that Valeo was reluctant to do so as it considered the claim to be so “outlandish” in its scale as not to have any credibility.

vi) There were no further discussions between the parties between that call and the 18 May 2023 extension order.

1. 1. This was therefore not a case where there was “real and substantial progress” in settlement negotiations as between the claimants and Valeo, justifying the claimants holding back from incurring the expense of serving out of the jurisdiction. Nor, indeed, was there even any concrete offer of settlement on the table. Rather, the claimants were simply hoping that Valeo would respond to their (very preliminary) communications regarding the commencement of settlement discussions. It is apparent from Mr Bolster’s note of the April 2023 call that, as of the date of that call, Valeo had not yet done so. The claimants were therefore, during the period between issue of the claim form and the May 2023 extension order, simply hoping for Valeo to engage in settlement negotiations which did not, in the event, ever occur. That does not provide a sufficient justification for the claimants’ failure to take steps to serve on Valeo.

1. 1. Finally, while Valeo was sent the claim form and particulars of claim for information on 17 May 2023, that does not in the circumstances of this case constitute a sufficient ground to grant an extension of time, given the expiry of the limitation period, the consequent prejudice to Valeo of being deprived of limitation defence, and the fact that there was (as I have found) no good reason for the claimant’s delay. Mr West submitted that Valeo’s objection to the extension of time was a purely technical one, since Valeo could be brought back in to the proceedings by way of a contribution notice. That is, however, not a basis for an extension of time to be given for service of the claim form where no good reason for such an extension has been shown.

1. The order for an extension of time for service on Valeo should therefore be set aside. The consequence is that the Valeo defendants were served out of time, and the claim against Valeo is therefore dismissed.