Instrumental executions - the mighty section 39 of the Senior Courts Act 1981 and its role in commercial litigation

What is this section and when it is used?

Section 39(1) of the Senior Courts Act 1981 ('SCA 1981') confers an extremely strong, and widely under-used, power enabling a party to have a document effectively executed where a recalcitrant opponent is refusing to do so.

Where the High Court has given a judgment or order directing a person to execute any document, then, if that person does not comply (or cannot be found), the court may order that the document be executed by such person as the court may nominate for that purpose. In practice, the person nominated is usually a Master or Judge of the High Court.

By section 39(2) of the SCA 1981, a document executed in pursuance of an order under this section shall operate, and be for all purposes available, as if it had been executed by the person originally directed to execute. 

In other words, pursuant to this section, the court can, quite literally, step into the shoes of an uncooperative or missing party in order to sign, date and return a document bringing that party into compliance with the High Court's existing judgment or order.

Whilst s39 SCA 1981 is frequently used in disputes within the Family Division – and, in particular, in disputes concerning real property or divorce enforcement proceedings – it can also be used to great effect in general debt enforcement proceedings. 

However, its application in wider commercial litigation is less common. The somewhat scare use of this section in commercial litigation is surprising when one considers its wide-reaching powers and its legal effect.  

Conditions for use: 

1. There must exist a judgment or order from the High Court requiring someone to execute any document.

In practice, the court will not grant a s39 SCA 1981 application unless and until the respondent is in fact in breach of the court judgment or order: the case law (see: Lindsay v O’Loughnane [2022] EWHC 3703 (KB); Isbilen v Turk [2021] EWHC 3425 (Ch)) and indeed the White Book and Red Book suggest that a mere anticipatory breach, however well-founded and likely to eventuate, is not enough.  Perhaps the need to go back to court again and incur a second set of costs (after the recalcitrant respondent has in fact failed to execute the document) explains this provision's infrequent use.

2. The court retains a discretion under section 39 (which it will only exercise "where it considers it is just to do so"), and it may impose any terms and conditions as it deems just. 

Pursuant to the reported cases and in our own experience, this second condition effectively means that the application of s39 SCA 1981 is as a last resort. The court will expect an applicant to have evidence showing that they have attempted, likely on numerous occasions, to get the other party – be they recalcitrant or their whereabouts unknown – to execute the instrument in question before seeking intervention from the court. 

For example, in Welch v Welch [2017] 6 WLUK 341, the Wife in divorce proceedings had not complied with the Judge's order for the sale 'forthwith' of the jointly owned matrimonial property. The Wife had actively taken steps to undermine and breach the Judge's order, for example in her (unsuccessful) attempts to overturn the Judge's possession order requiring the Wife to vacate the property in order for it to be sold, as well as her attempts to derail the sale process on numerous occasions by deliberately discouraging potential purchasers. 

The Judge ordered the Wife to execute the conveyancing documents within seven days. She did not comply and made clear to the Judge that she would continue to refuse to cooperate, hence the Judge executed the documents himself pursuant to the powers conferred on him under s39 SCA 1981 to enable the property to be sold, in accordance with the earlier court order. 

How can civil litigators use this section?

In our view, s39 SCA 1981 has a wider application across a broad range of commercial dispute contexts outside of family disputes and/or divorce enforcement proceedings, and is an important tool in the arsenal of any civil litigator. 

For example, in Lindsay v O’Loughnane, referred to above, the Defendant owed the Claimant a judgment debt pursuant to an earlier judgment. The Claimant made an application under s39 SCA 1981 for the court to nominate someone other than the Defendant to give written notice to three of his pension providers and instruct them to draw down the entirety of those funds and pay them directly to the Claimant to satisfy the judgment debt.

In disputes involving companies,  if a non-obliging party's written consent or signature is required (be they a director or a shareholder), but that party continues to refuse to cooperate, a s39 SCA 1981 application could be a neat workaround.  Even the threat of such an application might be useful to ensure compliance with any judgment or order.  One can imagine situations where the court has ordered a recalcitrant director to execute a written resolution causing the company to take some step which is in its interests, and a s39 SCA 1981 application being necessary.  Or a situation, as we encountered recently (see Lim & Ors v Ong & Ors [2023] EWHC 321 (Ch)), where a director/shareholder of a company was directed to transfer legal title to certain shares to the successful claimant following trial but refused to do so. In this case, s39 SCA 1981 was the answer. 

A further, albeit narrower, example where this provision might be used is in the context of disclosure.  Where a respondent has been ordered to produce documents and contends it no longer has documents in its possession, an application under s39 SCA 1981 could be used to compel the respondent to write to third parties in neutral terms directing that they provide copies of such documents to the respondent.  One can envisage this being particularly useful in getting documents from "professional" third parties who are likely to have proper records, such as lawyers, accountants, bankers etc, into the hands of the respondent, who would then be compelled to disclose them in the proceedings.  Although such documents would likely fall within the respondent's 'control' and would therefore be within the scope of disclosure anyway, an application under this section could assist where there are concerns about whether the respondent will request the documents in neutral terms, or where a respondent refuses to request the documents at all. 

It is evident that s39 SCA 1981 is also of great utility in disputes involving recalcitrant offshore defendants whose whereabouts may or may not be unknown, as well as in disputes against persons unknown (notably in the context of frauds).  Faced with an application brought under this section, an offshore fraudster or a person unknown cannot not simply hide behind being outside of the jurisdiction or seemingly 'unknown' to the jurisdiction as a way of evading executing the document in question. Rather, in these circumstances, the mighty s39 SCA 1981 will come to the claimant's rescue.

Conclusion

Given the far-reaching powers of s39 SCA 1981, it is somewhat surprising that we have not seen it deployed more frequently in reported cases. We have given several examples of where this section can be used to great effect in a range of commercial litigations and expect that its broad application may appeal to many practitioners and applicants alike. Given the rise of cases against persons unknown, as well as the continuing plethora of fraud disputes, we anticipate that this section may prove very useful to all those who call upon it.