Cyprus court dismisses application to set aside writ service due to waiver and lack of fatal irregularities.

[*116] 1975 December 16

(STAVRINAKIS, P.D.C.)

IN THE DISTRICT COURT OF NICOSIA

N.K. Shacolas (Merchants) Ltd.,

Plaintiffs,

and

Anderssons Partiaffar Ab, Ulricehamn,

Defendants.

(Action No. 332/75).

Civil Procedure - Service of writ of summons - Application to set aside - Objection relating to jurisdiction and irregularities in the making of the order to seal and serve - Contract concluded by telexes - Contract made where acceptance is received by telex - Distinction between acceptance by cable/letter and telephone/telex

- In the former case contract concluded in country where acceptance is sent from and not where it is received - Waiver of irregularities - Fresh steps whether fatal depends on nature of irregularities and nature of step - Application dismissed.

A. Argyrides, for Applicants-Defendants.

P. Ioannides, for Respondents-piaintiffe.

RULING

The following ruling was delivered by:-

STAVRINAKIS. P.D.C.: The defendants in this [*117] Action apply for an order of the Court setting aside:-

(a) The writ of summons, and

(b) The order grafting leave to seal and serve notice of the writ of summons abroad.

The grounds are that:-

(i) The name of the defendants was wrongly stated on the writ.

(ii) The Court lacked jurisdiction.

(iii) The order granting leave to seal and serve was based on an incomplete affidavit or on insufficient grounds.

The full grounds appear in the affidavit filed in support of the application.

During the argument of the application, learned counsel for the applicants alleged that in the affidavit filed in support of the application for leave to seal and serve, there ought to have been full disclosure of the telexes through which the agreement was made. Also, it was alleged that the comparative costs of hearing the case in Cyprus, or in Sweden, should have been stated in the affidavit which was not done, and further neither the nationality of the defendants is stated, nor whether they are not ordinarily resident in Cyprus. Finally, it was contended that service by double registered letter is something for which no mention is made in the Rules.

Learned counsel for the plaintiffs/respondents submitted that there were no irregularities and that from [*118] the telexes (attached to their affidavit in support of the opposition to the present application), it is clear, as they say, that the breach was committed in Cyprus. It was also argued that the applicants waived the irregularities by taking fresh steps.

History of proceedings:-

The plaintiffs filed, on the 23rd January,1975, an Action against the defendants for damages for breach of contract made in or about May 1973, for the sale of potatoes. On the same day, they applied for an order to seal and serve notice of the writ of summons on the defendants in Sweden; they also applied for an order for substituted service of notice of the writ by double registered letter. The Court issued the order in terms of the application.

The present application was filed on the 19th April, 1975, and on the day it was returnable, the plaintiffs/ respondents appeared and opposed the application which was fixed on the 4th July, 1975, for mention, and then, on the 24th October, 1975, for hearing.

On the 20th June, 1975, the plaintiffs filed an application for the amendment of the title of the Action regarding the name of the defendants. The application was made by summons and was returnable on the 4th July, 1975. On that day, counsel appearing for the defendants consented to the making of the order applied for by the plaintiffs.

This being in short the history of the proceedings and having in mind the argument advanced by both sides, the [*119] issues falling for determination may be confined to the following

(a) Jurisdiction.

(b) Irregularities.

A. Jurisdiction:

Under the Cyprus Procedure Rules Order 6 Rule 1 (e), the Court in cases of contract has jurisdiction where -

"the action is one brought to enforce, rescind, dissolve, annul, or otherwise affect a contract or to recover damages or other relief for or in respect of the breach of a contract”.

“(i) made in Cyprus, or”.

“(ii) made by or through an agent trading or residing in Cyprus on behalf of a principal trading or residing out of Cyprus, or is one brought in respect of a breach committed in Cyprus of a contract wherever made, even though such breach was preceded or accompanied by a breach out of Cyprus which rendered impossible the performance of the part of the contract which ought to have been performed in Cyprus;"

The facts of the case, as may be gathered from the affidavits filed both in support of and in opposition to the application, are as follows:- [*120]

By an exchange of telexes, there was an agreement for the sale by the plaintiffs to the defendants of a quantity of potatoes. The dispute revolves around -

(a) The date of shipment.

(b) The opening of a letter of credit.

According to Order 6 Rule 1(e) of the Cyprus Procedure Rules, what should be ascertained are:-

(a) Where the contract was made, or

(b) Where the breach was committed.

In the Annual Practice, 1960 Vol. 1 p. 146, under the heading "Made within the jurisdiction", a few cases are cited to the effect that where a contract is concluded through a letter or cable, the contract is prima facie made at the place where the letter or cable of acceptance is transmitted from.

However that may be, the situation in the present case is different because the communication was not made through cables or letters but through telexes which in the case of the Endores Ltd. v. Miles Far East Corporation* (cited by counsel for the respondents) were equated with telephone communications which stand on a different footing regarding the acceptance of an offer. [*121]

In the case of instantaneous communications, such as telephone or telex, the contract is only complete when the acceptance is received by the offeror and d the contract is made where the acceptance is received.

In the affidavit filed in support of this application, there is an averment in para 5 that it was the plaintiffs who first made the offer and then, in para 9, it is alleged that the plaintiffs’ offer was accepted by the defendants in Sweden.

There is no dispute that the transaction was made through telexes and if the offer was in fact accepted by the defendants in Sweden through a telex, then, according to the Endores case, the contract was concluded in Cyprus within the jurisdiction of this Court. This is sufficient to give the Court jurisdiction to deal with the case and bearing in mind all the surrounding facts, this ground of objection fails.

B. Irregularities:

1. The first ground of objection is that the telexes were not attached to the affidavit in support of the application to serve abroad. On this, reference was mode to Order

11 Rule 4 of the English Rules of the Supreme Court, whereby, under the heading "Contents of affidavit" at p. 152 of the 1960 edition of Annual Practice Vol. 1, stress is laid on the necessity to making a full and frank disclosure of the facts. It was argued on behalf of the applicant that the failure to append the telexes relied upon rendered the affidavit incomplete. [*122]

Having examined the contents of the affidavit complained of, I have found nothing missing in this respect so as to justify the discharge of the order. It may be that the applicants/defendants interpreted the documents in a different way but the interpretation given to them by the respondents/plaintiffs is not so unreasonable or untenable so as to render the attacked affidavit as misleading.

2. The second complaint is that no facts are given regarding the comparative costs and convenience of proceedings in Cyprus and in Sweden. This requirement is not, in my opinion so strict as to justify the discharge of the order. It is to be noted that this requirement is, according to the English Rules, confined to the service of the writ to Scotland or Northern Ireland and no reference is made to other countries, probably because in the former case the comparative costs can more easily be obtained than the legal costs in other countries.

In this particular case, I imagine that it would be difficult to obtain a full and accurate estimate of the legal costs in Sweden. Finally, on the issue of convenience, the affidavit evidence before me shows that the case has to be decided mostly on documents and in such a case it cannot be said that it would be more convenient for the case to be tried in the one or the other country.

For the above reasons, this complaint is overruled.

3. The third complaint is that it is not stated in the [*123] affidavit whether the defendants are ordinarily resident in Sweden

and no mention is made about their nationality. The relevant part of the affidavit translated in English reads as follows (para. 11):-

"The defendants are a trading concern in Sweden and the service on them of notice of the writ of summons by double registered letter is the appropriate method in the circumstances".

The first part of the paragraph, in my opinion fulfils the requirement of stating where the defendants are ordinarily resident. The object of this requirement is to ascertain where the service is to be effected and by stating that the defendants are a commercial trading concern in Sweden, implies prima facie that they are ordinarily resident in that country and that service can be effected in that country.

The other leg of the complaint, namely that the nationality is not specified, in my opinion is cured by the fact that the service of notice instead of a copy of the writ of summons is sought to be served on the defendants. This requirement is seemingly necessary to ascertain whether service of the copy of the writ of summons is appropriate or not. In this case, the very nature of the application, whereby notice instead of copy of the writ of summons is sought, supplies the necessary information about the defendants’ nationality. Therefore, the Court was not In any doubt as to the form of the writ that had to be served. [*124]

For these reasons, this complaint is also rejected.

4. The last ground of objection is that the notice of the writ of summons was effected by double registered letter. This is a form of substituted service and was specifically applied for by the applicants in their application for leave to seal and serve. If in the case of Sweden there is no convention relating to service, then Order 6 Rule 7 does not apply, and, therefore, a party may apply directly for substituted service as provided by Rule 9 of the same Order. There is no evidence that a convention exists and, therefore, there was no need to comply with Order 6 Rule 7; furthermore, there is no allegation that the mode of service approved by the Court was ineffective.

The paramount consideration in deciding as to the mode of substituted service is whether the service will be effective and indeed, in the present case, it proved to be so. The relevant Rules are invoked in the application and although in the affidavit only casual reference is made to the mode of service, yet I find nothing lacking in the application likely to have misled the Court.

For this reason, this ground is also dismissed.

Mr. Ioannides, appearing for the plaintiffs/ respondents in this application, further alleged that the defendants had taken fresh steps in the case and, therefore, they are disentitled from asking for the service of the [*125] notice of the writ of summons to be set aside. The "fresh steps" in question are:-

(a) Appearance on behalf of the defendants in an application made by the plaintiffs for the amendment of the title and their consent to the issue of the order.

(b) The request on behalf of the defendants’ counsel to be supplied with a copy of the writ of summons in English.

In an application to set the service of the writ of summons aside, no fresh steps should be taken in the proceedings (Order 64). What amounts to a step depends entirely on the nature of the step taken and in the Annual Practice 1960, p. 1988, examples are given of what steps were considered as fatal and what not. The general test in determining the effect of each step is given in the same book at p. 1988 which reads:-

"It seems that what is a sufficient step under this Rule must depend on the nature of the irregularity and that the question is whether there is constituted a waiver of the objection".

The case of Rein v. Stein (1892)62 L.T.469 is cited where it was held that -

"In order to establish a waiver, you must show that the party has taken some step which is only necessary or only useful if the objection has been actually waived or has never been entertained." [*126]

In this case, the application is of a composite nature. At the outset, it may be said that the consent to the amendment of the title by changing the name of the defendant is a waiver of the alleged irregularity regarding the mode of service but not of the irregularities relating to the jurisdiction and other matters associated with the propriety of the issue of the order to serve abroad. The application to set aside was already filed and pending before the other side applied for the amendment of the title and, therefore, the appearance and participation in the latter application may not affect the right of the applicants in the former application.

Having found that the service by double registered letter and the other objections do not stand, the issue of waiver is only of academical importance and I do not consider it necessary to say any more about it.

For the above reasons, the application is dismissed with costs.

Application dismissed with costs.

* 1955 Law Reports 2 Q.B.D. p. 327; applied in the Brimnes(1973)1 All E.R., 769.