Key Points:
The object of an order for substituted service is to bring to the knowledge of the relevant person the proceeding against him or her.
Debtors who are aware of the potential for banks and other creditors to take action against them often actively take steps to avoid the service of the Court's processes on them. This can cause difficulties when personal service is required, for example where orders for the possession of property are sought.
This is where substituted service can play an important role. The courts will allow you, in certain circumstances, to serve documents such as bankruptcy notices or a creditor's petition in another way. In this article we'll set out the basics of substituted service and provide some practical guidance for obtaining an order for it.
The law on substituted service: "impracticable to serve"
Rule 116 of the Uniform Civil Procedure Rules 1999 (Qld) provides:
Similar provision exist in other jurisdictions.
"Impracticable to serve" has been interpreted to mean "unable to effect prompt personal service" or "impractical".
The plaintiff must show that at the date on which the application for substituted service is made, the plaintiff, using reasonable effort, is unable to serve the defendant personally (Foxe v Brown (1984) 58 ALR 542). Evidence of unsuccessful attempts can help to prove this (Embry v Smart [2014] QCA 75), as can evidence "that it is so obviously futile as not to warrant an attempt at service" (Ricegrowers Co-operative Ltd & Anor v ABC Container Line (1996) 138 ALR 480).
Locating a defendant for service
Banks and other lenders will generally include in any credit contract a term about the service of documents, including the address for service of the borrower defendant. This is binding when documents are served pursuant to the contract, but the Court's processes must be adhered to when proceedings are commenced, particularly the requirement for proceedings to be served personally. In circumstances where a plaintiff does not have the benefit of a contractual provision dealing with service, and the defendant cannot be located, they will need to seek an order for substituted service in the first instance.
The cases indicate that a plaintiff must use reasonable effort to serve the defendant, and cannot blindly rely on the details in the credit contract as the address for service. It is likely that the Court will require evidence that the defendant is, in fact, at the address at which attempts have been made to serve the proceedings. This evidence may include conducting various searches to locate the defendant's current address, such as:
- title searches for known property;
- ASIC searches if the defendant is a director;
- telephone directory searches;
- contact with any known employer or residents at previous known addresses;
- determining the business address of the defendant; and
- electoral roll searches.
You may also wish to engage a private investigator in order to locate the defendant and, where possible, provide contact details.
Evidence of attempts at service
The Court will require evidence, by way of affidavit, of the attempts made to serve the documents on the defendants personally, along with any searches contacted in order to locate and contact the defendant. In the alternative, you must have evidence that it is "obviously futile" to attempt to serve the proceedings personally.
There is no rule requiring a certain amount of attempts at service prior to the granting of an order for substituted service. All that is required is that it be impracticable to personally serve the documents on the defendant. Evidence of that impracticality should be provided to the Court; it may include evidence of any attempts by the defendant to actively avoid service.
Alternative modes of service
The object of an order for substituted service is to bring to the knowledge of the relevant person the proceeding against him or her.
On that basis, an applicant for an order for substituted service is required to propose a method of service which is likely to bring the fact of the proceedings to the knowledge of the defendants and provide evidence to the Court that the proposed method will result in the defendant becoming aware of the proceedings. Such method will depend on the circumstances of the case. Methods of substituted service include:
- emailing the Court process to the defendant (where it is known that the defendant uses the relevant email account);
- leaving or posting the documents at an address known to be the address of the defendant;
- serving someone closely connected with the defendant (ie. spouse, solicitor, attorney under power of attorney);
- advertising the proceedings in a local newspaper;
- using the defendant's social media account (although the case law on this is still evolving); or
- some combination of the above.
The Court will generally require that the order for substituted service be served, with the proceedings, using the same method.
Key lessons for getting an order for substituted service
In determining whether to make orders for substituted service the Court will consider:
- the practicalities of personally serving the documents;
- details of the attempts made to serve the proceedings; and
- evidence of the defendant's current whereabouts.
It is important to ensure that an appropriate alternative method of service is provided to the Court which will give it comfort that the proceedings will come to the defendant's attention.
Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.
