A Practical Approach To Substituted Service: Grand Court Allows Substituted Service Of A Winding Up Petition On A Registered Cayman Company

• Published date: 17 June 2022
• Subject Matter: Corporate/Commercial Law, Corporate and Company Law
• Law Firm: Ogier
• Author: Ms Gemma Lardner and Farrah Sbaiti

The Grand Court of the Cayman Islands (Court) recently handed down written reasons (Ruling)¹ for ordering substituted service of a winding up petition on Bridge Global Absolute Return Fund SPC (Bridge Global) by permitting the documents to be sent by email to its sole director, residing out of the jurisdiction. The approach adopted by the Court in Bridge Global demonstrates the pragmatic manner in which the Court has managed questions around service of originating processes and is particularly relevant where COVID-19 and other global factors have prevented, and may continue to prevent, personal service of documents by traditional means.

Background

Brazen Sky Limited (Petitioner) presented a petition to the Court to wind up the company on the just and equitable ground. Directions were ordered for service of the petition, summons for directions and supporting documents on the Company's registered office as required by section 70 of the Companies Act (2021 Revision)(Act). Upon attempting to effect personal service in the usual way, it was discovered that the Company's registered office had been closed and no longer existed. The Petitioner applied for an order for substituted service to be effected by sending copies of the said documents to the sole director of the company by email.

Considerations

In determining the application the Court considered the jurisdictional basis for making an order for substituted service on a company registered under the Act. While there was limited judicial authority on the question of jurisdiction, the Court considered that a clear statutory basis had been identified.

The Companies Winding Up Rules (CWR) O.1, r.4 provides that the Grand Court Rules (GCR) for service² and substituted service³ apply to every petition, summons or other documents required to be served under the CWR. The rules relating to service out of the jurisdiction⁴ also apply where this is required.

The Court noted that GCR O.65, r.4⁵ pivotally provides that substituted service may be ordered where personal service (at the registered office in the case of a company) is "impractical for any reason". The Court held that the crucial question was whether service by email to a sole director is reasonably likely to bring the documents to the notice of the company. The Court considered that it would and that the Petitioner should not be put to undue time and expense seeking to identify a means for service against a company at a registered office that no longer existed...