US Supreme Court finds that Hague Service Convention does not prohibit service of process by mail in US lawsuits

In Water Splash, Inc v Menon, the US Supreme Court examined the question of whether the Hague Service Convention prohibits service of process by mail on non-US parties sued in US cases. The US Supreme Court unanimously found that service by mail is permissible where: (1) the receiving state has not objected to service by mail; and (2) service by mail is authorised under other applicable legislation in the receiving state.

Key points

  • The US Supreme Court judgment has made it easier for US plaintiffs to serve non-US corporations in many non-US jurisdictions.
  • Companies located outside the US should be mindful of whether their jurisdiction has objected to service by mail during the negotiation of the Hague Service Convention, or whether such service is authorised under legislation or court rules in their jurisdiction.

Background

In Water Splash, Inc v Menon, the plaintiff corporation sued its former employee, Tara Menon, in a Texas state court, alleging that she had started working for a competitor while she was still their employee. Water Splash, Inc sought and obtained permission from a trial court to effect service by mail, because Menon was resident in Canada. The trial court issued default judgment against Menon, after she failed to answer or otherwise enter an appearance, and later denied her application to set aside the judgment on the grounds that she had not been properly served under the Hague Convention (the "Convention"). Menon contested the trial court decision, and the Texas Court of Appeals found in her favor, agreeing that the Convention prohibits service of process by mail. The US Supreme Court subsequently agreed to review the case, to resolve a question that has divided the lower US courts: whether the Hague Service Convention precludes service by mail.

US Supreme Court judgment

Article 10(a) of the Convention states that "[p]rovided the State of destination does not object, the present Convention shall not interfere with – (a) the freedom to send judicial documents, by postal channels, directly to persons abroad."

The US Supreme Court rejected Menon's argument that the phrase "send judicial documents" should mean something different than the phrase "effect service of judicial documents", which is used in Articles 10(b) and 10(c) of the Convention. The Court held that the text and structure of the Convention (including the preamble which states that it is intended "to ensure that judicial and extrajudicial documents to be served abroad shall be brought to the notice of the addressee in sufficient time"; and Article 1, which defines the Convention's scope by stating that it "shall apply in all cases, in civil or commercial matters, where there is occasion to transmit a judicial or extrajudicial document for service abroad") strongly suggest that Article 10(a) pertains to service of documents (including the summons and complaint that start a US lawsuit). Menon's claim that Article 10(a) only applies to the service of "post-answer judicial documents" rather than to service of process, the Court found, "lack[ed] any plausible textual footing in Article 10."

Rather, the Court found that interpreting the word "send" as a broad concept that includes, but is not limited to, service was more plausible than interpreting it as excluding service. In support of this, the Court pointed to the following extra-textual sources which "comfortably resolve[d] any lingering ambiguity" about whether Article 10(a) applied to service: the Convention's drafting history strongly suggests that the drafters understood that service by mail was permissible; since the adoption of the Convention, the US State Department has consistently maintained that the Hague Service Convention allows service by mail; and other signatories to the Convention have consistently adopted the view of the plaintiff (multiple foreign courts, including the UK High Court in Crystal Decisions (UK) Ltd v Vedatech Corp, EWHC (Ch) 1872 (2004), 2004 WL 1959749, at ¶ 21, have held that the Convention allows for service by mail).

See also Hague Conference on Private International Law, Convention of 15 November 1965 on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, Status Report, accessible here , which identifies jurisdictions that have objected, or declined to object, to postal service under Article 10. In its holding, the Court pointed to the Dutch Government's treaty database, the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters: Parties With Reservations, Declarations and Objections, accessible here, which identifies jurisdictions that have objected, or declined to object, to postal service under Article 10.

Just because Article 10(a) encompasses service by mail, however, does not mean that the Convention affirmatively authorises service by mail.  Article 10(a) simply provides that, as long as the receiving state does not object, the Convention does not "interfere with "'the freedom to send judicial documents, by postal channels, directly to persons abroad'". In other words, "in cases governed by the Hague Service Convention, service by mail is permissible if two conditions are met: first, the receiving state has not objected to service by mail; and second, service by mail is authorised under otherwise-applicable law."

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