Can a Registered Office Resign?
About Jennifer Haworth
Jennifer Haworth is a Director in the firm’s Litigation & Dispute Resolution team. Jennifer has a wide practice in all aspects of civil and commercial litigation both in Bermuda’s courts as well as in mediation and arbitration.
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In the case of Abu Dhabi Commercial Bank PJSC v Algosaibi Trading Services Limited [2014] SC (Bda) 71 Com (12 September 2014), the Chief Justice delivered an ex tempore judgment which clarified what the position is when a registered office purports to resign. It confirmed the traditional view held by many commercial practitioners that section 62(3) of the Companies’ Act 1981 (the “Act”) means that when a registered office has not been changed with the Registrar of Companies (“ROC”), the last known registered office remains the effective office for service.
Abu Dhabi, the Petitioner and creditor of Algosaibi, served a statutory demand on 11 July, 2014 calling for payment of the judgment sum of Saudi Riyals 268,836,991.89 on the listed registered office, Canon’s Court, 22 Victoria Street, Hamilton. MJM was counsel to the Petitioner. Communication was then received from the registered office, indicating that they had resigned by way of letter sent to the ROC, and was thus no longer the registered office. We searched the ROC file and Canon’s Court was identified as the registered office.
In considering the application to wind up Algosaibi, the question relating to service which the Chief Justice considered was “…whether or not, in circumstances when it is known that that office has in effect been abandoned or has ceased to be an active office, the registered office continues to be an effective location for service to be effected on a company”.
Section 62(3) of the Act says, “The company may change the situation of its registered office from time to time by giving notice in the prescribed form to the Registrar and such change takes effect upon the notice being registered by the Registrar”. We submitted, on behalf of the Petitioner, that in absence of a new notice identifying another registered office having been filed and placed on the ROC file, that Canon’s Court remained the registered office for the purposes of effecting service. This represents the traditional view held by commercial practitioners, but there was no previously published judgment dealing with the point.
As the Chief Justice quite rightly pointed in delivering his judgment, “…it would be a considerable gap in our legal framework if it were not possible to serve a company effectively simple because the registered office was not an active one”. It was therefore held that service on the last known registered office was good service.