Key issues for company directors from the recent case Key Homes Bradford Ltd and others v Patel  All ER (D) 69:
A recent High Court decision provides a warning to company directors who move abroad without updating their address for service on the register of directors.
The claimants served the claim form on the defendant (a former director of the claimants) by delivering it to two addresses in England, which he had listed on the register of directors. The defendant disputed service on the basis that he was no longer resident in the United Kingdom at the date of service and neither address was his usual or last known residence. The court held that the defendant had been validly served with the claim form at the address listed on the register.
This decision makes it clear that directors who choose to move abroad without updating their address for service on the register will leave themselves open to be served with proceedings in England, if an English address is still listed.
Section 1140 Companies Act 2006.
This permits a document to be served on a company director by leaving it at or sending it by post to the person’s registered address. This applies whatever the purpose of the document in question. The registered address is the relevant address in the register of directors available for public inspection.
The case is a ground-breaking decision of considerable practical importance. There had been no prior cases considering the application of the section. The High Court decided that section 1140 allows a claimant to serve a company director with proceedings at the director’s registered address in the UK without seeking the court’s permission and regardless of whether (a) the proceedings concern that company or (b) the director resides outside the jurisdiction.
This means claimants will be entitled to serve on the English address listed on the register and avoid the need to obtain permission to serve outside the jurisdiction. Conversely, any directors moving abroad should check the register so that they are aware of what address is listed. Directors who choose to move abroad without updating their address for service on the register, leave themselves open to be served with proceedings in England, if an English address is still listed by them
This reminds me of a case where solicitors on the other side made an incorrect assumption that I was acting for both the first defendant (limited company) and second defendant (individual director, sued personally). It was clear however that I only had instructions to accept service on behalf of the limited company. I had to send back the proceedings meant for the Director. The claimants’ attempts at service on him failed, and they were out of time. They were unable to reinstate the proceedings against the director in this multi-million pound claim and the action against him was struck out. The claimants’ solicitors ultimately had to pay costs on that service dispute exceeding £20,000.
J Paul Sykes LLB LLM
First Published February 2014