Applying to Set Aside a Default Judgment

The law on setting aside default judgments can be found in Part 13 of the Civil Procedure Rules (CPR).

Definition of Default Judgment

Once a claim has been issued the defendant has 14 days in which to respond. If within that time they file an acknowledgement of service they are entitled to a further 14 days to return their defence. The law states that, if the defendant does not file an acknowledgment of service or defence, the claimant is entitled to ask the court for a default judgment. A default judgment is, therefore, a judgment entered without a trial after the defendant’s failure to defend the claim.

Irregular Default Judgments

The law distinguishes between two types of default judgments: “regular” and “irregular” judgments. A default judgment will be irregular if it has been entered when:

• The defendant has filed an acknowledgement of service or a defence;
• The time for filing the acknowledgement or defence has not yet expired;
• The defendant has made an application to strike out the claim or for summary judgment;
• The defendant paid off the whole claim, including any costs and interest, before judgment was entered;
• The defendant has filed an admission to the debt and asked for time to pay.

A default judgment entered in any of these circumstances is not valid in law and the court must set it aside.

Regular Default Judgments

If the defendant fails to respond to a claim, which has been issued and served in accordance with the law, the claimant is entitled to apply for a default judgment. A default judgment entered in these circumstances is said to be “regular”.

The Law on Applying to Set Aside a Regular Default Judgment

If a defendant wants to set aside a default judgment he will have to make an application to the court. If the claim was not issued in the defendant’s local court the case will be transferred to that court and a hearing of the application will be listed.

To have a default judgment set aside the defendant will have to satisfy the following legal test found in Part 13 of the CPR:

• He has a defence with a real prospect of success; or,
• The judgment should be set aside for some other good reason; and,
• The application to set aside the judgment was made promptly.

Applying Promptly

In deciding whether or not the defendant has acted promptly in making their application the relevant date is usually the date on which the defendant found out about the judgment. Judges have differing views on what constitutes a prompt application. Some say that anything over four weeks shows that the defendant has failed to act promptly – others will entertain applications made many months later.

The Merits of the Defence

The defendant will also have to convince the judge that he has a defence that has a real prospect of succeeding. It is not enough for the defendant to show merely that he has a defence that would be arguable in law. The defendant should support their application with evidence.

Setting Aside Default Judgments on Terms

In some circumstances the judge may agree to set the judgment aside provided that certain conditions are met. For example, a judge could order the defendant to pay the amount claimed into court. This might be done in the case of a defendant who is pursuing a tenuous defence simply because he cannot afford to pay the debt.

The Defendant Says That He Never Received the Claim Form

The law on service of court documents states that:

• if the court sends the defendant a claim form at his usual or last known address; and,
• it is subsequently returned to the court as un-delivered;

the claim form has still been validly served and the claimant is entitled to a regular default judgment.

Therefore, even if the defendant can persuade the judge that he never received the claim form, the judgment was still regular as a matter of law. However, it may provide an explanation for the defendant’s failure to respond to the claim.

The Judge’s Discretion

The law on default judgments provides judges with a wide discretion to set judgment aside. Justice demands that a judgment which has been entered with no, or little, regard to the merits of the claim should be set aside if the defendant has a good defence and made his application promptly. However, there is no point setting aside a default judgment if the defendant has no chance of defending the claim. It would be a waste of time and money because, ultimately, the claimant would simply obtain another judgment. The courts should be slow to deprive the claimant of a valid judgment obtained in accordance with the law.