Flame SA v Primera Maritime Hellas Ltd [2009] EWHC 1973 (Comm)

Once a defendant decides not to challenge jurisdiction, the suspension of time limits that comes into effect when a party indicates that it intends to challenge jurisdiction ceases and the ‘normal’ time limits apply. This means that, if a defendant uses the full 21-day period allowed for Acknowledging Service and the full 28-day period for challenging jurisdiction before deciding not to make that challenge, the time for service of the defence will have expired. In such a case, the defendant should seek an extension of time, either by agreement or court order, or risk judgment in default being entered against it.

Although a ‘tactical misjudgement’ such as this should not deprive a defendant of the opportunity to defend the claim, where it has a real prospect of success, that was not the case here and the default judgment should stand. Even if the default judgment was set aside, the defendant would have needlessly incurred signifi cant costs.

The facts of the case are as follows: the claimant served proceedings, including the Particulars of Claim, on the defendant in Greece on 27 April 2009. Primera’s defence had to be served within 35 days, but that time frame was suspended when Primera indicated in its Acknowledgement of Service that it would be challenging jurisdiction. Primera had 28 days from the date of fi ling its Acknowledgment of Service to make its challenge application. Prior to the expiry of that period, Primera informed Flame that it would not be proceeding within the challenge and would be fi ling a defence. Flame argued that the 35-day period for serving the defence had expired and that, since the parties had not agreed an extension of time, it was entitled to enter judgment in default. The court agreed.