This matter came before the Court on 15 May 2024 for the hearing of an amended notice of motion filed by the plaintiff on 1 March 2024. The plaintiff seeks two orders of substance being:
1. pursuant to rule 11.8AA of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR"), the Court grant leave to the plaintiff to proceed against the fourth defendant; and
2. judgment for the plaintiff against the fourth defendant for damages to be assessed as pleaded in paragraphs 32 to 53 of the amended statement of claim filed on 15 December 2022.
The application is supported by affidavits from the solicitor for the plaintiff dated 27 March 2023, 7 July 2023, 1 March 2024, 19 April 2024 and 10 May 2024.
There was no appearance by the fourth defendant. The first and second defendants and the third defendant do not oppose the orders sought in the motion and did not wish to be heard on the application, albeit there were appearances on their behalf on the hearing of the motion.
[2]
Background
The plaintiff, who is currently 42, sustained catastrophic injuries in an accident at the premises of the first and second defendants at Belrose on 19 May 2019.
On that day, the plaintiff was visiting the first and second defendants, the first defendant being her sister, when she fell or was thrown from a zip line which had been erected on the property in or about 2017. As a result of the accident, the plaintiff has been rendered a C4 quadriplegic and has been left with permanent significant disabilities.
At the time of the accident, she was working as the Corporate Counsel for Bayer. She is married with three children.
The plaintiff alleges that she sustained injury when, whilst using the zip line at the property, the braking mechanism failed such that there was no deceleration of the seat on the zip line on which she was sitting as it moved towards the end of the zip line. Further, the stop block affixed to the end of the zip line also failed.
She thus approached the end of the zip line at a considerable speed. The trolley came to a halt near or against a tree supporting the end of the cable. She was thrown off the seat onto a nearby tree stump and then onto the ground. She sustained catastrophic injuries as a result thereof.
The plaintiff pursues proceedings against four defendants. The first and second defendants were the owners and occupiers of the property. They are alleged to have been responsible for the installation, maintenance, and operation of the zip line. The third defendant is the Australian distributor of the zip line kit. It offers the zip line kit for sale. The fourth defendant, a company incorporated in the United States, was the manufacturer of the zip line kit. It supplied the zip line kit for use on the first and second defendants' property. The plaintiff alleges that each of the defendants was negligent.
In respect of the first and second defendants it is alleged that they failed to conduct regular maintenance checks and inspections on the zip line and failed to consider the warnings provided by the third defendant, as well as permitting persons to use the zip line in circumstances in which the brake pad was worn through and the stop block was not correctly installed.
The allegations of negligence against the third and fourth defendants are identical. They are alleged to have been negligent in designing, manufacturing, and supplying zip line components which had a propensity to wear and failing to provide adequate warnings as to their propensity to wear.
The plaintiff also pursues a cause of action under ss 138, 271(1) and 272(1)(b) of the Australian Consumer Law against the third and fourth defendants.
Whilst the original motion was pursued against both the third and fourth defendants, the third defendant has since filed a defence. There has been no appearance on behalf of the fourth defendant since the commencement of the proceedings.
The plaintiff says that the fourth defendant has been properly served and, in those circumstances, the plaintiff seeks leave to proceed against the fourth defendant whilst at the same time seeking the entry of judgment in default against it. As it happens, the fourth defendant was at the time of commencement of the proceedings in "dissolution", which I understand to be similar to being placed in administration under Australian law. I will comment on the significance of that later in this judgment.
The application requires a consideration of various provisions of the UCPR, New Hampshire law and the procedure for service of a foreign corporation.
[3]
Leave to proceed
The plaintiff seeks leave to proceed against the fourth defendant under r 11.8AA of the UCPR, which is in the following terms:
11.8AA Leave to proceed where no appearance by person
(1) If an originating process is served on a person outside Australia and the person does not enter an appearance, the party serving the document may not proceed against the person served except by leave of the court.
(2) An application for leave under subrule (1) may be made without serving notice of the application on the person served with the originating process.
The granting of leave is discretionary. The principles governing a grant of leave under r 11.8AA are drawn from the decision of the High Court in Agar v Hyde (2000) 201 CLR 552. Although the High Court was there concerned with the previous equivalent rule under the Supreme Court Rules, several decisions of this Court have held that the relevant considerations are the same: see Bingley-Pullen v Montgomery [2018] NSWSC 1308 at [2]-[3].
In Rossiter v Core Mining Limited [2015] NSWSC 360, Adamson J summarised the relevant considerations to be derived from Agar v Hyde as follows:
1. whether the defendant has been properly served;
2. whether the claims in the originating process fall within sch 6 to the UCPR;
3. whether the plaintiff has an arguable case, being one that would be sufficient to survive an application for summary judgment; and
4. whether the court is not a clearly inappropriate forum.
See also Bingley-Pullen v Montgomery [2018] NSWSC 1308 and Hutchinson v AD Securities America LLC [2021] NSWSC 1573.
The principal issue on this application is whether the defendant has been properly served with the statement of claim.
[4]
Service
As identified by Mr Williams in his affidavit of 27 March 2023, the registered address of the fourth defendant was 148 Woodhill Hooksett Road, Bow, New Hampshire 03304, US. An email address associated with the company was also identified. That email address incorporated the name "Steve". The registered agent is Stephen Brown.
Somewhat curiously, the plaintiff embarked on two processes to serve the fourth defendant, once directly and then through the Registrar of the Court.
On the first occasion, Mr Williams, the solicitor of the plaintiff, dealt directly with the licenced agent for service in the United States, ABC Legal Services ("ABC Legal"). On the second occasion, Mr Williams dealt with the Registrar of this Court, who then dealt directly with the same service organisation, ABC Legal, which is referred to as the process server for the central authority in the United States. As I will discuss later in this judgment, the UCPR provides for service outside Australia through Part 11, which relates to service abroad generally, and/or Part 11A, which concerns service under the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters ("the Hague Convention").
For the purposes of this application, the plaintiff submits that service was validly effected through the "first process" that is by engaging with ABC Legal directly, such service being compliant with either pt 11 or pt 11A.
At this point, it is useful to set out a brief chronology of the plaintiff's attempts to effect service on the fourth defendant.
On 28 October 2022, Mr Williams submitted documents to ABC Legal for service on the fourth defendant including:
1. a letter from Clayton Utz to the fourth defendant dated 24 October 2022 enclosing the statement of claim filed on 18 May 2022;
2. a copy of the statement of claim filed on 18 May 2022; and
3. a Request for Service Abroad Model Form under the Hague Convention.
On 31 October 2022, the solicitors for the plaintiff became aware that the proper process for service of documents under the Hague Convention, which is governed by pt 11A of the UCPR, was for the plaintiff to make an application to the Registrar under r 11A.4 for the Registrar to forward a request for service to ABC Legal.
The plaintiff made such an application on 2 November 2022 by way of a letter to the Registrar which attached the following documents:
1. a draft request for service abroad (UCPR form 91);
2. a copy of the statement of claim filed on 18 May 2022; and
3. a summary of the document to be served (UCPR form 92).
On 4 November 2022, Mr Williams received an email and Certificate of Service from ABC Legal to the effect that on 3 November 2022 all of the documents provided by Mr Williams to them (described at [25]) had been left with a person at the registered address of the fourth defendant, who identified herself as the spouse of the registered agent, that is the spouse of Stephen Brown.
As the Certificate of Service identifies, an agent of ABC Legal, Amy Scott-Ross, personally left the documents at Stephen Brown's usual place of abode with "Jane Doe" (a pro forma name is included). The person refused to give her name but indicated she was the subject's spouse and co-resident. The individual accepted service with direct delivery. The documents provided by the plaintiff to the Registrar were not served at this time.
That is presumably because it was not until 17 November 2022 that the Registrar sent a letter to ABC Legal requesting service of those documents on the fourth defendant.
On 18 November 2022, the Registrar received a certificate of service from ABC Legal dated 3 November 2022. This certificate of service was the same certificate that had been provided to the plaintiff's solicitors on 4 November 2022. This indicates that there was no "second attempt" by ABC Legal to effect service upon the fourth defendant after receiving the Registrar's request. The necessary inference then is that the documents described at [27] were never served upon the fourth defendant. This is presumably why the plaintiff does not rely upon the so called "second process", being the attempt to effect service by approaching the Registrar of this Court.
Subsequent to confirmation of service, the solicitors for the plaintiff sent a number of other documents by email and air mail to the fourth defendant, including letters informing the fourth defendant of the upcoming directions hearing, the proposed orders, the filing of an amended statement of claim and finally on 17 March 2023, gave notice of this application.
As set out in the further affidavit of Mr Williams dated 1 March 2024, subsequent to service on the fourth defendant, the solicitors for the plaintiff continued to provide other documents to the fourth defendant, using the relevant email address.
When providing the documents by email, the solicitors were able to determine that the email had been read. On a number of occasions, the solicitors for the plaintiff received a "read receipt" of their emails, indicating that the recipient of the email had read the email. This is not proof of service of the originating process but tends to suggest that the fourth defendant or its registered agent is aware of these proceedings and aware of the way in which the proceedings are being conducted.
[5]
Serving a foreign corporation
Part 11 of the UCPR deals with service outside Australia. Part 11A deals with service under the Hague Convention. I will deal firstly with pt 11.
[6]
Part 11 of the UCPR
As set out in r 11.4, an originating process may be served outside of Australia without leave in the circumstances referred to in sch 6.
The plaintiff did not seek leave prior to purporting to serve the statement of claim. In the circumstances of this matter, leave to serve was not required prior to service because this is a tortious claim for which the damage was sustained in Australia (see sch 6 (a)(ii)).
Rule 11.5 governs the situation when service is not allowed under r 11.4 and leave is required. It does not apply in the circumstances of this matter. Similarly, r 11.6 does not apply as there is no application being brought by the party who has been served.
Rule 11.7 is in the following terms:
11.7 Notice to person served outside Australia
If a person is to be served outside of Australia with an originating process, the person must also be served with a notice in the approved form informing the person of -
(a) the scope of the jurisdiction of the court in respect of claims against persons who are served outside Australia, and
(b) the grounds alleged by the plaintiff to found jurisdiction, and
(c) the person's right to challenge service of the originating process or the jurisdiction of the court or to file a conditional appearance.
The approved form for the purposes of r 11.7 is UCPR form 161.
The approved from, relevantly, requires the plaintiff to:
1. Notify the defendant that they have been served with an originating process under r 11.4 of the UCPR;
2. Annex a copy of r 11.4 to the form;
3. Advise the defendant that rr 11.3 to 11.8AC govern the jurisdiction of the Court in respect of claims against persons who are served outside Australia;
4. Specify the grounds upon which it claims to be entitled to serve the defendant outside Australia, including the paragraphs of sch 6 upon which the plaintiff relies;
5. Advise the defendant of its right to make an application to dismiss or stay the proceedings or set aside the service of the originating process on the basis that:
1. The service was not authorised by the rules of the Court; or
2. The Court is an inappropriate forum for the trial of the proceedings; or
3. The claim has insufficient prospects of success to warrant putting the defendant to the time, expense and trouble of defending the claim;
1. Advise the defendant of its right to file an unconditional notice of appearance and that additional procedural obligations may apply where such an appearance is filed; and
2. Warn the defendant that if it does not make an application to set aside service or file an unconditional notice of appearance, the Court may give leave to the plaintiff to proceed against it without further notice.
The plaintiff has not served a notice in accordance with r 11.7.
If an originating process is served outside Australia and the person does not enter an appearance, the party serving the document must seek leave of the Court to proceed: r 11.8AA. As the fourth defendant has not entered an appearance, the plaintiff requires such leave of the Court. That is the basis of the current application.
Rule 11.8AB applies to service of documents other than an originating process outside Australia and thus is not relevant to the current application.
Rule 11.8AC is in the following terms:
11.8AC Mode of service
A document to be served outside Australia need not be personally served on a person so long as it is served on the person in accordance with the law of the country in which service is effected.
The effect of r 11.8AC is that service outside Australia may be effective even if the document has not been served personally on the person provided that it has been served in accordance with the law of the country in which the document is served.
Whilst r 11.8AC follows r 11.8AB it does not seem to me that its application is limited to documents other than the originating process (as r 11.8AB is). The statement of claim is, on the ordinary meaning of the word, a document. The dictionary to the UCPR clarifies that a reference to a "document" "includes any part of a document and any copy of a document or part of a document".
Having regard to all of those provisions, service of a statement of claim outside Australia with respect to a claim that falls within sch 6 (and thus does not require prior leave) may be effected by serving the document in accordance with the law of the country where the document is to be served, provided that a notice in accordance with r 11.7 is also served with the statement of claim.
[7]
Part 11A of the UCPR
Part 11A applies to service under the Hague Convention. Division 2 of pt 11A applies to service in a Convention country of a local judicial document.
As set out in r 11A.4, a person may apply to the Registrar in the Registrar's capacity as a local forwarding authority, for the Registrar to make a request for service in a Convention country of a local judicial document. The United States is a Convention country. Rule 11A.4 sets out the procedural steps which must be then taken and the documents which must be provided.
As set out in r 11A.5, if the Registrar is satisfied that r 11A.4 has been complied with the Registrar must sign the request for service abroad and forward the relevant documents to the nominated authority in the Convention country.
On receipt of a certificate of service in due form (see UCPR form 91), from the nominated authority, the Registrar must arrange for that document to be filed and provided to the applicant. Further, a certificate of service in due form in relation to a statement of claim is, in the absence of any evidence to the contrary, sufficient proof that service was effected as specified and in accordance with the law in force in the Convention country: r 11A.8.
[8]
Was service validly effected?
In order to grant leave to the plaintiff to proceed under r 11.8AA, I must be satisfied that the plaintiff was properly served with the statement of claim. In this respect, the plaintiff seeks to rely upon the provisions of pts 11 and 11A and, in particular, r 11A.8.
[9]
Part 11A of the UCPR
The direct engagement between Mr Williams and ABC Legal, which is not the ordinary process contemplated by pt 11A, calls into question whether the plaintiff can, in fact, rely upon the provisions of this Part.
Counsel for the plaintiff submitted that a proper reading of pts 11 and 11A of the UCPR does not lead to a conclusion that a person is prohibited from sending a request for service of documents directly to the Central Authority of a Convention country. In this respect, the plaintiff relied upon article 10 of the Hague Convention which provides that unless the state of destination objects, the Convention shall not interfere with:
"[T]he freedom of any person interested in a judicial proceeding to effect service of judicial documents directly through the judicial officers, officials or other competent persons of the State of destination."
However, the plaintiff is not able to point to articles of the Convention itself as authorising the approach it has adopted if that approach is not authorised by legislation. That is because of the longstanding principle that international treaties are not a source of individual rights or obligations unless they are incorporated into domestic law (see Minister for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 286-287 per Mason CJ and Deane J).
Where legislation, such as pt 11A of the UCPR, has sought to give effect to Australia's obligations under an international treaty, it is the legislation which governs the rights and obligations of the parties and not the provisions of the treaty itself. In Maloney v The Queen (2013) 252 CLR 168, Kiefel J (as her Honour then was) explained the approach to be adopted to statutory interpretation where a treaty has been implemented in Australian law at [174]:
"In Salomon v Commissioners of Customs and Excise, Lord Diplock discussed the relevance of a treaty or convention to the task of a domestic court in construing legislation which was passed to implement that treaty or convention. The starting point is that the task of the court is to construe the legislation, for that is what the court has to apply. The ordinary rules of statutory construction apply where a domestic statute incorporates provisions of a convention or treaty or when resort is necessary to them because the terms of the legislation are ambiguous." (Citations omitted)
It is therefore necessary to consider the terms of pt 11A of the UCPR to determine whether direct engagement with the Central Authority is permitted. Part 11A contains no reference to the ability of a party to make a request directly to the Central Authority of a Convention country.
There are two defined terms of particular significance to this Part. The first is "request for service abroad" which is relevantly defined as "a request for Service in a Convention country of a local judicial document mentioned in rule 11A.4(1)." Rule 11A.4 concerns applications by the Registrar to request service in its capacity as a forwarding authority. The second definition of significance is "forwarding authority" which is, relevantly, defined as the Registrar.
In order to place any reliance upon r 11A.8, the plaintiff is required to demonstrate that the certificate of service is in "due form". Ordinarily, that would require the certificate to be in the form provided for in UCPR form 91. The certificate of service did not purport to be in such a form. However, as Hammerschlag J explained in Nitro Circus Touring Australia Pty Ltd v Lenzoni [2016] NSWSC 178 at [28]-[35] ("Nitro Circus"), a certificate of service may still be considered to be in due form if it constitutes "substantial compliance" with UCPR form 91.
The problem for the plaintiff is that it is not apparent how the certificate can be considered to substantially comply with the requirements of the approved form in circumstances where the plaintiff has not engaged in the process contemplated by pt 11A. Rule 11A.8 must be read in the context of pt 11A as a whole. The certificate of service obtained from ABC Legal refers to service being effected before the documents provided to the Registrar were forwarded to ABC Legal. Further, the certificate of service refers to the applicant for service as being the Supreme Court. However, there had been no application made by the Registrar of this Court at that time. The first request that ABC Legal serve the fourth defendant was made by the solicitors for the plaintiff and not through the Court.
Although the plaintiff belatedly made a request to the Registrar in accordance with r 11A.4, she does not rely on that for the purpose of this application. This is no doubt because the Registrar did not ever receive a new or fresh certificate of service from ABC Legal but rather ABC Legal merely sent back the same document that it had provided directly to the solicitors for the plaintiff. This could not be a certificate of service in the due form within the meaning of r 11A.6(2). Rule 11A.6(1) itself refers to the certificate relating to a "request for service abroad", r 11A.1 limits the meaning of such requests to requests made by the Registrar. In my view, service was not effected in accordance with pt 11A.
The plaintiff placed considerable reliance upon the decision of Hammerschlag J in Nitro Circus. The distinction between this case and Nitro Circus is that the plaintiff in that case had complied with the procedure set out in pt 11A, in that the plaintiff had made an application to the Registrar in accordance with r 11A.4 and the relevant documents were served pursuant to a request by the Registrar. The irregularities that then arose in relation to the certificate of service were not attributable to the plaintiff but rather to the relevant Central Authority. In circumstances where the plaintiff in this case has not adopted the process contemplated by pt 11A, the decision in Nitro Circus is readily distinguishable.
[10]
Part 11 of the UCPR
Whether service was effected in accordance with pt 11 gives rise to a number of issues.
The first is whether the fourth defendant has been validly served in the manner which was adopted, that is, by leaving the originating process with a person at the registered address who did not identify herself by name, but identified herself as the spouse of the registered agent.
Rule 11.8AC provides that a document served outside Australia need not be personally served on a person so long as it is served on the person in accordance with the law of the country in which service is effected. The certificate of service from ABC Legal is evidence of purported service in accordance with New Hampshire law.
Rule 26(3)(a) of the New Hampshire Supreme Court Rules permits service either personally of by first class mail. Similarly, the provisions of the New Hampshire Revised Limited Liability Company Act XXVIII NH Rev Stat Ann (2013) permits service on the registered agent or by airmail at the registered address (see s304-C:37).
In my view, delivering the document to the address of the registered agent and having it accepted by a person who purported to live there constitutes service in accordance with New Hampshire law. This is because, personal delivery must be to the same effect as service by mail. On either scenario, the documents are delivered to and left at the address. Section 510:13, Title LII, of the New Hampshire Revised Statutes permits service on a limited liability company such as the fourth defendant in a similar way (see also s510:2 which prescribes the manner of service).
In the circumstances, I am satisfied that the statement of claim was served in accordance with New Hampshire law.
However, there has not been compliance with r 11.7. A notice in the approved form was not served on the fourth defendant. In my view, this is an important notice as it informs the recipient of the three matters set out r 11.7. The r 11.7 notice is intended to ensure that the recipient of the statement of claim is aware of what the person is receiving; the effect of the document; the basis of the claim against him; and options available to the person in response to service upon him. Whilst the Court has the power to waive compliance with any rule and may do so if there has been substantial but not complete compliance with the rule, it does not seem to me that I should simply waive compliance with a rule intended to ensure that the recipient of the statement of claim is aware of his options in response to the statement of claim.
[11]
Conclusion
The result of all of this is that:
1. The fourth defendant was served pursuant to the direct request to ABC Legal of the plaintiff, not the Registrar;
2. The only mechanism permitted under pt 11A is a request to the Registrar to effect service;
3. Service has not been effected in accordance with pt 11A;
4. Nor has service been properly effected in accordance with pt 11 as the r 11.7 notice was not served at the same time. This is mandatory. It is not a question of just looking at the certificate of service and considering whether there has been substantial compliance.
In all these circumstances, I am not satisfied that the fourth defendant has been properly served.
[12]
Dissolution of the fourth defendant
A further complicating factor is that the fourth defendant was dissolved on 31 August 2021.
A question thus arises as to whether the plaintiff can still proceed against the fourth defendant.
The effect of the dissolution of a limited liability company ("LLC") for the purposes of New Hampshire law is dictated by the New Hampshire Revised Limited Liability Company Act XXVIII NH Rev Stat Ann s304C (2013).
Although the Act took effect on 1 January 2013, it is expressed to apply to companies established before that date (see s304-C:5). The fourth defendant was established before that date.
Section 304-C:144 deals with the ability of a plaintiff to bring a claim against a dissolved LLC. Provided a dissolved LLC publishes a notice which complies with the requirements in s304-C:144(II), claims of a type set out in s304-C:144(III) will be barred unless proceedings are commenced within 3 years of publication of the notice.
In this case, the fourth defendant was dissolved on 31 August 2021 and the statement of claim was provided to it on or around 2 November 2022. Accordingly, proceedings were commenced against the fourth defendant within 3 years of dissolution meaning 304-C:144(III) does not operate to bar the plaintiff's claim or prevent it from being served with the originating process.
The authority of a LLC's registered agent is not terminated on dissolution (s304-C:137(II)). That registered agent therefore remains a person upon whom an originating process naming the company as a defendant may be served.
Provided that the fourth defendant is properly served prior to 31 August 2024, the dissolution of the company would not, in the circumstances of this matter, prevent the plaintiff from proceeding against it.
[13]
Orders
However, as I am not satisfied that the fourth defendant has been properly served, the plaintiff is not entitled to proceed against the fourth defendant at this time.
I assume that the plaintiff will endeavour to correct this irregularity. The appropriate orders are as follows:
1. I stand this matter over for further directions before me on 1 August 2024.
2. I grant liberty to the plaintiff to contact my chambers to have the matter relisted for final disposal of the motion on three days' notice.
[14]
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Decision last updated: 05 June 2024