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Serving and receiving legal notices amid Coronavirus disruption

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24/03/2020

What businesses need to know to avoid missing deadlines and ensuring valid service

As businesses endeavour to carry on so far as is possible amid the disruption caused by the Coronavirus crisis, one area in which practical difficulties will need to be quickly overcome is the service and receipt of legal notices.  Commercial dispute resolution specialists Gwendoline Davies and Nick McQueen offer their expert advice.

New challenges in a notoriously tricky area

Legal and procedural traps for the unwary mean that the drafting and service of legal notices is a notoriously tricky area even in the best of times.  The consequences of getting a legal notice wrong, or of missing immediate receipt of any notice served on your business, can be so significant that our advice is routinely that legal notices should be prepared or reviewed respectively, by experts in the field.  In these unprecedented times, however, where the impact of the Coronavirus is forcing the closure of offices and other business premises, the practical difficulties associated with serving and receiving legal notices are brought even more sharply into focus.

Whether you are a business seeking to serve notices to terminate contracts, break leases, commence warranty or other claims, or similar; or whether you are a business concerned to ensure that any legal notices served upon you are received, reviewed and dealt with urgently and effectively, the following legal and practical advice should assist.

Advice in relation to the receipt of legal notices

The immediate receipt and review of any legal notice served on a business is necessary for a number of reasons.  For example, it will be essential, in every case, to ascertain the validity of any notice served, so that the business knows whether or not the notice has legal force.  Where a notice is valid, it will inevitably be the case that some consequential action or decision will need to be taken by the business – usually within a strict period and often with time being of the essence.

The closure of business premises, not to mention potential disruption to postal and other delivery services, will cause significant practical difficulties when it comes to the receipt and urgent review of legal notices – not least in circumstances where a notice is deemed served at the point of posting (as opposed to at the point of receipt), which is very commonly the case.

So what can businesses do?

  • Businesses should familiarise themselves with the service of notices provisions in their various contracts and leases and should note, in particular, any specified address for service. This may differ from contract to contract, or from lease to lease.
  • Companies should ascertain whether any business address is also their registered office address at Companies House; or/or whether any business address is the address for service given at HM Land Registry.
  • Where any registered office is the address of a third party, it will be essential to enquire how post to that address is being monitored.
  • One option, where a registered office is closed, might be to change the registered address at Companies House to an address where post can be collected. However, it is important to note that this may not cover all potential notices, as the notice provisions in some contracts/leases allow service at locations other than the registered office (such as the last known place of business, or at another specified address).
  • Once a business has an overview of the different service of notices provisions which govern its various contracts and leases; and once it has ascertained any specified addresses for services, it will be in a position to put into place practical arrangements to continue to collect post during any period premises are closed, even if this is temporary.
  • Practical arrangements might include:
    • Collecting post (which might involve agreeing with any landlord that access will be permitted once or twice a day in order for post to be collected), where it remains physically possible for post to be left at fully locked-down premises
    • Setting up a forwarding service with Royal Mail
    • Setting up an external post box, at a suitable location, which is checked daily. Security, and whether external fixings are permitted, would need to be considered
  • Some contracts/leases allow the parties to notify each other of alternative addresses for service. If your contract allows you to do this and it is necessary or preferable in these circumstances, you should give notice of a suitable alternative address as soon as possible. (As to advice in relation to the giving of legal notices, including such as this, please see below.)
  • If a contract/lease does not contain a specific provision allowing change of the address for service by giving notice, this might be a variation that the parties can agree between themselves in any event [1].
  • It is unlikely to be practical to formally vary all of your contracts/leases for a temporary period, but if you have a concern about a particular contract where time-sensitive notices are likely to be served in the coming weeks, it might well be worth seeking to formally vary those arrangements.
  • Where addresses for service can be altered as a result of Coronavirus disruption, the most sensible solution would be to permit service by email.
  • Where any change of address for service is effected (including any change to permit service by e-mail) it will be important for that change to be notified to all customers, suppliers, other counter-parties, and third parties. Apart from any contractually-specified obligations as to giving notice of the new address, businesses could insert a note in all emails, letters and on their websites and social media postings.  By way of example, such a note could advise that, following the closure of premises due to Coronavirus, the business will accept service of legal documents by email (specifying any conditions or limits, such as with regard to email size mbs), and providing a specific email address to which any formal notices may be sent.
  • Where any change of address for service is effected, it will also be important for that to be considered alongside other relevant clauses within the particular contact/lease and for any changes to be monitored on an ongoing basis. For example, what happens if a party gives a PO box or external post box as its service address, but the contract specifies service by recorded delivery?  (You cannot effect recorded delivery on an unmanned box.)  What happens if the contract specifies that the service address is to be a party’s registered office, but the contract is assigned in due course to an individual?  (Individuals do not have registered offices.)  What happens if a residential address for service is given, and then the (presumably senior) individual living at that address moves house?  And so on…
  • Where a contract/lease does not allow for a change of service address and this cannot be agreed between the parties, it may be a helpful practical measure to inform parties of an additional address at which you can receive notices in the event your place of business is closed. In these circumstances, however, you may not be able to insist on notices be served on the new address, and so suitable arrangements to check post delivered to the closed premises will remain essential.

Advice in relation to the service of legal notices

As is apparent from the above, most modern commercial contracts and leases contain detailed service of notice clauses which contain specific legal and procedural obligations and requirements.  If those provisions are not strictly complied with, any notice can be invalidated. The consequences of that can be devastating for the serving party – for example where an invalid notice means that a once-and-for-all break option is lost, or a time-limited warranty claim is precluded.

A good tip, when it comes to the service of any legal notice, is to remember the mantra: who, when and how?

Immediately a party considers serving a notice, it should ascertain exactly:

Who is required to give notice and on whom the notice should be served. (Consider the party/counter-party itself? Legal representatives? Other agents? Have there been any assignments, novations or variations which change the position? What are the current names and addresses/contract arrangements for the relevant parties/agents?)

When the notice should be served, including whether there are any long-stop dates for service or for completion of any other conditional/procedural steps (such as commencing any follow-on court claims, or the like) [2].

The ‘how‘ is particularly important in the context of Coronavirus-related closures.  It covers the content of the notice; the form of the notice and any strict procedural requirements; and the fact that service must be effected in accordance with any contractually specified method and at any contractually specified (or any new/recently agreed?) place.

WM Comment

The consequences of dealing with service or receipt of any legal notices can be too costly to gamble in the ordinary course of business – never mind in light of the additional legal and practical hurdles that arise from Coronavirus-related disruption.

The best advice is therefore for businesses to seek specialist legal advice at the earliest opportunity as to likely options or requirements for the service or receipt of notices over the next few months, so that suitable legal and practical preparation and planning can be undertaken.

For further information, advice and expert assistance, please do not hesitate contact Gwendoline Davies, Nick McQueen or any member of Walker Morris’ Litigation and Dispute Resolution department.

 

[1] Albeit parties should note the legal position if the contract/lease contains any anti-variation/no oral modification provisions.  See our recent briefing for further information and advice

[2] It is also important to bear in mind, when calculating dates, that there may be different dates to ascertain. For example, depending on the nature and wording of the notice clause, you may need to know the date on which a notice actually has to take effect; the date by which it has to be served on (i.e. received by) the receiving party; and/or the date by which it has to be issued.  All of those dates can be influenced by other factors (such as the required method of valid service; how long that will take; whether the contract designates when service will take place or whether the contract relies on external deeming provisions; whether there are any weekends/bank holidays to take into account and/or whether only working/business days count (which can differ across different countries); and so on.

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