Service under the CBIR

This case concerned an application for recognition in England of Hong Kong bankruptcy proceedings pursuant to the Cross-Border Insolvency Regulations 2006.

The debtor’s argument that service on him of the recognition application was defective was rejected at first instance and the debtor appealed.

Para 22 of Schedule 2 to the CBIR provides that service shall be effected before the hearing by delivering the documents to a person’s proper address or in such other manner as the court may direct. A debtor’s proper address is defined as any which they have previously notified as their address for service within England and Wales but if they have not notified any such address, service may be effected in various other ways as set out in para 22(3) including at the debtor’s last known address in England and Wales.

In the present case, there had been no notification by the debtor of an address for service and service had been effected on him in Hong Kong without first seeking the court’s direction authorising such service.

The appeal court held:

  1. The provisions of paragraph 22 of Schedule 2 are mandatory. Therefore an applicant who cannot be served at his “proper address”, as defined for this purpose in para 22(3), must be served in accordance with the court’s directions. It is unclear from the judgment whether the court’s direction is not required for any of the service methods as set out in para 22(3) (including service at last known residence in England and Wales) or whether the court’s direction is only not required where the debtor has previously notified an address for service in England and Wales.
  2. However, the court's function under the CBIR is to lend support to foreign insolvency proceedings, the parties requiring to be served are often be abroad and service out of the jurisdiction should be a routine matter. Thus, if for sufficient reason the applicant fails to obtain directions for service but the debtor receives the documents in good time and is able to act without detriment, the court has the power to and is likely to retrospectively authorise the “service” that took place.

Yu v Cowley [2020] EWHC 2429 (Ch)

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