High Court finds proceedings can be served at English address registered by overseas director under Companies Act 2006

In what appears to be the first case interpreting section 1140 of the Companies Act 2006, a High Court Master has found that service on a director's English registered address was good service of proceedings, regardless of whether the director was resident in England: Key Homes Bradford Ltd & Others v Rafik Patel [2014] EWHC B1 (Ch).

Obtaining permission to serve outside of the jurisdiction (where required) and then effecting service overseas can be costly and time consuming. The Key Homes decision is not binding, but if followed will mean section 1140 provides a quick and inexpensive method of service where a foreign defendant is a director of a UK company and has registered a UK address under the Companies Act 2006.

The Master interpreted the registration provisions as permitting a director to specify an address outside of the jurisdiction, provided the relevant Regulations under the Act were complied with. If correct, directors resident abroad can avoid being served within the jurisdiction under section 1140 by providing a service address outside the UK.

Background

Proceedings were served by the claimant at two addresses in England relying, in part, on section 1140 of the Companies Act 2006. The material parts of the section provide:

"(1) A document may be served on a person to whom this section applies by leaving it at, or sending it by post to, the person's registered address.

(2) This section applies to-

(a) A director or secretary of a company …………….

(3) This section applies whatever the purpose of the document in question. It is not restricted to service for purposes arising out of or in connection with the appointment or position mentioned in subsection (2) or in connection with the company concerned.

(4) For the purposes of this section a person's "registered address'' means any address for the time being shown as a current address in relation to that person in the part of the register available for public inspection.

(8) Nothing in this section shall be read as affecting any enactment or rule of law under which permission is required for service out of the jurisdiction."

The defendant accepted that service had taken place at his registered addresses. However, he argued that he now resided in the UAE and that section 1140, taking into account subsection (8) and its proper construction overall, did not abrogate a general rule of conflicts law that a person may not be served with proceedings within the jurisdiction at a time when he is outside the jurisdiction unless that absence is temporary. 

Decision

Master Marsh held that service had been effective. Subsection (8) merely prevented service without permission where an address outside the UK had been given. As for absence from the jurisdiction, the Master considered City & Country Properties Limited v Kamali [2007] 1 WLR 1219 to have decided in the context of an individual that the general rule no longer applied, i.e. absence from the jurisdiction (whether temporary or permanent) does not prevent service.

There are likely to be further decisions on section 1140. Whilst the wording of the section is very wide, the Kamali decision is a controversial one. Similar principles do not apply in a company setting (SSL International Plc v TTK LIG Ltd [2011] EWCA Civ 1170) and it is unclear whether it does make a difference if the absence is permanent rather than temporary. Pending further clarification, however, overseas directors may wish to consider the addresses they have registered and whether they are appropriate in the circumstances.