Entering and Setting Aside Judgment in Default
In civil litigation, a judgment in default can be entered against a defendant who fails to respond to a claim. This can occur when the defendant does not file an acknowledgment of service, a defence, or admit the claim within the required time limits. A default judgment grants the claimant the relief sought in the claim without the need for a trial. However, there are circumstances under which a default judgment can be set aside, either automatically or at the court's discretion. The procedures for entering and setting aside default judgments are governed by the Civil Procedure Rules (CPR).
Entering Judgment in Default
A default judgment can be entered in the following scenarios:
- ★ No Acknowledgment of Service: If the defendant fails to file an acknowledgment of service within 14 days of being served with the claim form, the claimant can apply for a default judgment.
- ★ No Defence Filed: If the defendant files an acknowledgment of service but fails to submit a defence within 28 days from the service of the claim form (or the time extended by the court), the claimant may seek a default judgment.
- ★ Procedure: The claimant must apply to the court for a default judgment by completing the appropriate forms. The court will then enter judgment for the claimant for the relief sought in the claim form, which may include monetary compensation, specific performance, or other remedies.
Types of Default Judgments
Default judgments can be classified based on the nature of the relief granted:
- ★ Default Judgment for a Specified Amount: If the claim involves a specified amount of money, the judgment will be for that amount, including any interest and costs.
- ★ Default Judgment for an Unspecified Amount: If the amount is unspecified, the court may enter a judgment for damages to be assessed. The assessment will take place at a subsequent hearing.
- ★ Default Judgment for Other Relief: The court may grant other forms of relief, such as an injunction or declaration, depending on the nature of the claim.
Setting Aside Judgment in Default
A defendant can apply to set aside or vary a default judgment under certain circumstances. The grounds for setting aside a default judgment include:
- ★ Mandatory Grounds: The court must set aside the judgment if it was entered incorrectly or if the defendant has filed a defence before the default judgment was entered.
- ★ Discretionary Grounds: The court has the discretion to set aside the judgment if:
- ★ The defendant has a real prospect of successfully defending the claim.
- ★ The defendant acted promptly in applying to set aside the judgment upon becoming aware of it.
- ★ There is a good reason why the default occurred, such as a failure to receive the claim form or other compelling circumstances.
Procedure for Setting Aside Default Judgment
To set aside a default judgment, the defendant must follow these steps:
- ★ Filing an Application Notice: The defendant must file an application notice (Form N244) with the court, explaining why the judgment should be set aside and providing evidence to support the application.
- ★ Supporting Evidence: The defendant should provide detailed evidence, including a draft defence if appropriate, demonstrating a real prospect of defending the claim or explaining the reasons for the default.
- ★ Promptness: The defendant should apply to set aside the judgment as soon as possible after becoming aware of it. Delays in applying may adversely affect the outcome of the application.
Court's Consideration and Outcome
When considering an application to set aside a default judgment, the court will evaluate:
- ★ Prospect of Success: Whether the defendant has a real prospect of successfully defending the claim based on the draft defence or other evidence provided.
- ★ Promptness and Reason for Default: The court will consider whether the defendant acted promptly and whether there were valid reasons for the failure to respond.
- ★ Prejudice to the Parties: The potential prejudice to both the claimant and the defendant if the judgment is set aside or upheld.
Case Law
Case Study - *Swain v Hillman* [2001] 1 All ER 91
This case established that a real prospect of success does not mean a defence must be certain to succeed, but that it has a realistic as opposed to a fanciful chance of success. This principle is crucial when considering whether to set aside a default judgment.
Examples
Scenario:
A defendant did not receive the claim form due to an incorrect address being used. Upon discovering the default judgment, they promptly applied to set it aside, providing evidence of the address error and a draft defence outlining a credible argument against the claim.
Example 2 - Mistaken Identity in Service
Scenario:
A company received a default judgment due to a failure to respond, as the claim form was mistakenly served on an unrelated business with a similar name. The company, upon learning of the judgment, applied to set it aside, demonstrating that they had no knowledge of the proceedings and provided a full defence.
Conclusion
Entering and setting aside a default judgment are critical aspects of civil procedure. A default judgment can expedite the resolution of a case in the claimant's favor when the defendant fails to respond. However, setting aside a default judgment is an important remedy for defendants who have legitimate reasons for their default and wish to contest the claim. The procedures ensure fairness and provide both parties with the opportunity to present their case fully.