CL-2024-000694 - [2025] EWHC 1647 (Comm)

MAIN FACTS

The underlying dispute arises from a Software License Agreement (“SLA”) dated 20 May 2019 between the Claimant and BBB, concerning an online casino platform called [C]. By the agreement, BBB agreed to provide white-label online casino services to the Claimant on a revenue-sharing basis (the details of which are disputed). The business relationship continued for over four years. Then on 21 June 2023 the Claimant purported to terminate the SLA with effect from 21 September 2023. However, it appears that the Claimant then requested postponement of termination of the SLA, and there was a period of a little over a year during which the parties corresponded about and discussed the way forward. Eventually, on 23 January 2024, BBB itself sent a notice purporting to terminate the SLA.

On 26 January 2024, the Claimant’s legal representatives New Balkans Law Office (“NBLO”) served a notice to arbitrate on BBB. However, matters appear to have moved slowly because, in his affidavit dated 25 November 2024 in support of the application for a WWFO, Mr X (Chief Legal Officer of the Claimant’s Group, of which the Claimant is the founder and major shareholder) said only that the Claimant “expects imminently to refer the claims to arbitration in Latvia” (§ 58).

The merits of the underlying claim are not a matter for the present application. It is sufficient to record that the claims are disputed. The Claimant alleges that he is owed approximately €11.28 million by BBB. BBB contends that the sum claimed has either (as to €6.33 million) already been paid to the Claimant or at his direction, or (as to €4.95 million) is not due to the Claimant because it was used to discharge legitimate operational expenses. BBB also claims to have a counterclaim for €24,702,766.

Mr X on 25 November 2024 swore his first affidavit, in support of an application for a WWFO pursuant to section 44(3) of the Act. The arbitration claim form was prepared with a statement of truth, signed by Mr Shoylev, dated 11 December 2024.

On 13 December 2024 the Claimant’s representative uploaded to CE-file his application notice and Mr X’s affidavit seeking a WWFO, and asked when the application could be heard. The same day, the listing office responded asking for a hearing bundle, skeleton argument, and reading and hearing time estimates.

The claim form and the application notice were sealed on 18 December 2024. Pursuant to CPR 62.4(2), it was required to be served within one month of its date of issue, i.e. by 17 January 2025.

On 23 December 2024, Mr Iordache of NBLO (with Mr Shoylev in copy) told the listing office that the claim had now been issued, provided a link to the skeleton argument and hearing bundle, and gave reading and hearing time estimates. (After circulation of the draft judgment, Mr Shoylev informed the parties and the court that NBLO, which is not on the record for the Claimant in these proceedings, is the trading name of a Bulgarian Law Firm, Kamen Shoylev Law Firm, to which he is affiliated in his capacity as a Bulgarian advocate and separately from his membership of the Bar of England & Wales. NBLO is not, and could not be, instructed to conduct litigation in England. However, Mr Shoylev uses NBLO’s email servers for his email correspondence, and has on occasion been assisted in an administrative capacity by certain NBLO staff including Mr Iordache. The Defendants take issue with some of this. However, it is unnecessary for the purposes of the present judgment to consider the matter further.)

In his first witness statement dated 18 May 2025, in response to BBB’s present applications, Mr X provides this explanation of the events of December 2024 and January 2025:

“12.

Counsel for [AAA] originally filed the application notice and evidence in support of the Freezing Order on 13 December 2024 and requested a listing of the application as soon as possible on the same date. This filing was rejected at 5 pm on 16 December 2024 due to what was said by CE File to be an incorrect fee payment where the fee paid had been the fee payable for the issue of an application notice only. The application was filed once again on 18 December 2024 and rejected with the following explanation from the Court:

‘for pre-action injunction applications, the Judges in Charge of the Admiralty and Commercial Courts [had] directed that from now on, a claim form must be submitted alongside the application notice’.

A third filing was made on the same day, 18 December 2024. Following correspondence from Ms Pathan on behalf of the Court on 19 December 2024 in which she required corrections to the submitted claim form (one of which corrections was acceded to and the other resisted) on penalty of rejection of the submitted arbitration claim form rather than its being issued. Still, the arbitration claim form was apparently issued on 19 December 2024, with a seal date backdating it to 18 December 2024 (Arbitration Claim Form).

13.

In correspondence with the Court offices (including the Commercial Court Listing Office) starting from 13 December 2024, counsel for [AAA] sought to ensure the listing of the application. In particular, he did so by responding to a request for a reconfirmation of the time estimate for the expected hearing and highlighting the submission of a skeleton argument upon the Court’s request. On 23 December 2024, the Listing Office proposed that the case was likely not suitable for listing before a King’s Bench vacation Judge and the representative of [AAA] agreed and requested to list the hearing for the first available date after the start of Hilary Term. A message by the Listing Office on 2 January 2025 was to the effect that “to list an application, the listing office needs counsels’ clerks from all sides to email the inbox to fix in accordance with the lead times”. The clarification that the application was without notice was made the same day on behalf of [AAA]. The Court followed up further with a request to attend Court 37 for an out of hours Judge to hear the matter by the Listing Office. On behalf of [AAA] it was said in reply that:

‘While the matter is of some urgency (as otherwise an application without notice would not be appropriate), we have determined that the hearing of the application out of hours would not be necessary.’

14.

In further correspondence on the same day, the Listing Office requested a bundle and agreement between “counsels’ clerks”, alternatively requested approach on behalf of counsels’ [sic.] clerks (and explained that the matter will in due course be referred to a Judge to fix the date).

15.

While there was no further response from the Listing Office between 2 and 13 January 2025, [AAA] expected this time was needed to give the Court’s staff the opportunity to further review the listing request and bring it to the attention of a Judge for the review indicated by the Listing Office as above. On 13 January 2025, the Claimant wrote, reiterating his requests for a listing. In response, the Senior Listing Officer convened a telephone call. During the ensuing call with staff acting for counsel for [AAA], I am informed that the Court’s representative covered the ground of why [AAA] had not insisted on a hearing in the KBD during the judicial vacation; re-confirmed the urgency of the hearing and tentatively offered (possibly based on judicial input) the date of 7 February 2025 for the hearing. Counsel for [AAA] wrote to the Senior Listing Officer immediately following the call with him.

16.

In view of the fact that he had not put forward evidence of immediate dissipatory steps and had relied on ease of dissipation and the liquidity of the respondents’ assets as factors going to urgency and of the need to coordinate with respect to the parallel application for an injunction in Cyprus, it did not appear to [AAA] to be an appropriate use of court resources to seek a vacation listing or a listing with extreme expedition. At the same time, [AAA] expected a listing as soon as practicable and had been very hopeful that one would have been offered either between 2-13 January 2025 or at any rate immediately after the resumption of judicial term on 13 January 2025.

17.

In the event, following further correspondence with counsel for [AAA], the listing office eventually confirmed on 16 January 2025 that the application would be listed for a hearing on 7 February 2025.”

Paragraph 13 of that evidence includes the statement that “[o]n 23 December 2024, the Listing Office proposed that the case was likely not suitable for listing before a King’s Bench vacation Judge …”, which may give the impression that the Listing Office persuaded the Claimant that the matter was not urgent. The Listing Office in fact said, in an email of 24 December 2024:

“The Court is currently in vacation and no Commercial Court judges are available until Monday 13th January, when the next term starts.

As you have taken two weeks to respond with the hearing bundle this is presumably not sufficiently urgent for a vacation judge sitting in King’s Bench to hear. If so can you confirm what you are requesting as to when you would like the application listed for a hearing.”

The point being made was, accordingly, that the Claimant did not appear to have been pursuing the matter with urgency, so it was assumed not to be urgent. The Claimant responded requesting a hearing “as soon as there is availability after the commencement of the new term”. The new Term began on 13 January 2025.

On 2 January 2025 Mr Iordache (with Mr Shoylev in copy) reminded the court that the application was being made without notice. The Listing Office responded: “If this is an application without notice, currently we do not have any judges as it is vacation to hear the matter if a hearing is needed for this week or next week. Parties will need to go to court 37 in the RCJ for an out of hours judge to hear the matter.” Mr Iordache (with Mr Shoylev in copy) replied:

“We are aware that the court is currently in vacation. While the matter is of some urgency (as otherwise an application without notice would not be appropriate), we have determined that the hearing of the application out of hours would not be necessary. Our request earlier today that the matter be listed as soon as possible after 13 Jan was made on that basis.

If this is a workable starting point, we would be grateful if we could have a date in the light of the above.”

The hearing was in due course fixed for 7 February 2025. In the meantime, the time for serving the claim form expired on 17 January 2025.

The application for a WWFO was heard on 7 February 2025.

The Claimant’s evidence and skeleton argument in support of the WWFO pre-dated the issue of the claim form. The skeleton argument referred to the claim form as one of the suggested pre-reading items (“if time permits”), but at the hearing on 7 February 2025 the court’s attention was not drawn to the fact that the claim form (which the Claimant was seeking permission to serve out of the jurisdiction) had expired 21 days previously.

Further, no steps had been taken to serve the claim form since its issue. Mr X in his 1^st witness statement says:

“This will be primarily a matter for submission, but [AAA]'s position is that he could not reasonably have been expected to take any steps towards service of the Arbitration Claim Form before 13 February 2025. One reason in support of this is that serving the Arbitration Claim Form prior to the hearing listed for 7 February 2025 (and subsequently before 13 February 2025 when the Freezing Order was sealed) would have defeated the purpose of a without notice application. This view was consistently taken by [AAA] subsequently.”

The WWFO was sealed on 13 February 2025. Schedule B to the WWFO included an undertaking to serve the claim form and other documents “as soon as practicable”. However, no steps appear to have been taken in connection with service of the claim form until 28 February 2025, when the Claimant contacted the Foreign Process Section (“FPS”) about service of the claim form and the WWFO (the latter having been informally notified to BBB and various third parties in the meantime).

On 25 March 2025, the FPS pointed out that the claim form had expired, and asked whether the Claimant had a court order extending it. Mr Iordache (with Mr Shoylev in copy) replied the same day:

“Thank you for the below. This response is on behalf of Mr Shoylev. 

The arbitration claim form in question was filed solely in order to enable making an application without notice for a freezing injunction in support of a foreign arbitration. 

The basis for effecting service is the order of Mrs Justice Dias dated 13 February 2025 (included in the service pack) which requires that service of the order and the associated documentation (set out in paragraph 4 of Schedule B to the order) on the respondents be effected as soon as possible and grants permission for service out. 

In these circumstances, we take the view that there is no need for the extension of the arbitration claim form - serving it before the order of 13 February 2025 was made would have been out of the question, as the application was without notice.”

Similarly, on 27 March 2025 Mr Iordache (with Mr Shoylev in copy) told the FPS that they were “not seeking to effect any standalone service of the arbitration claim form”. It is evident from those responses that the Claimant’s representatives failed to understand (i) the significance of the claim form, as the document based on whose service the court’s jurisdiction was founded, and (ii) the mandatory requirement to serve the claim form within one month of its issue.

The claim form was purportedly served on BBB by a process server on 26 March 2025, ten weeks after it had expired.

On 28 March 2025 the FPS returned to the Claimant the documents which he had (through his representative) requested to be served, indicating that their in-house lawyer had stated that an extension order was needed before the FPS could serve the Claimant’s documents. That letter appears to have been received on 1 April 2025. Mr X says in his 1^st witness statement that it is only on receipt of that communication that he “identified a possible need to apply for extension of time in respect of the Arbitration Claim Form”. However, it is clear from the email correspondence referred to in § 21 above (to which Mr X also refers in his witness statement) that the Claimant’s representative knew by 25 March 2025 that the claim form had expired.

On 9 April 2025, the Claimant issued an application for, among other relief, “[e]xtension of the period for service of the arbitration claim form issued on 18 December 2024 pursuant to CPR 62.4(2)”. As indicated in §§ 38-40 below, that was the incorrect provision. The evidence in support of the application did not draw attention to the applicable requirements set out in CPR 7.6. It did not explain (a) when the claim form had expired, (b) what, if anything had been done to serve it before its expiry; (c) what, if any, difficulties the Claimant had with serving during the one-month period; (d) what had been done to resolve those difficulties, or (e) the basis upon which it could be said that the Claimant had made the extension application promptly. The only evidence that touched upon the question of the time for serving the claim form was as follows:

“[18] I understand that on 28 March 2025, the FPS informed counsel for [AAA] by letter that service of the 13 February Order and associated documentation cannot be effected on SGS Technologies Ltd in the Isle of Man pursuant to Article 5 of the Hague Convention unless an extension of time for the service of the arbitration claim form issued on 18 December 2025 is obtained.

[19] While [AAA]’s position had been that given the service of the arbitration claim form was as a supporting document to the 13 February Order and that therefore such an extension had not been required, to the extent that an extension of the period of validity of the said arbitration claim form is required to enable [AAA] to comply with his obligation to effect service pursuant to the 13 February Order, [AAA] applies for the extension of the period of service of the arbitration claim form prescribed in CPR 62.4(2) such that the claim form may be served for twelve months since its date of issue or such other period as the court may see fit.” (X 3, §18 and 19)

The extension application was granted, on the papers, on 16 April 2025, some 13 weeks after the claim form had expired.