Seeking To Set Aside A Default Judgment

Mandatory grounds for setting aside Default Judgment

There are a number of mandatory grounds on which a Default Judgment must be set aside under CPR Rule 13.2.

In summary, the court must set aside a Default Judgment wrongly entered by the court under CPR Part 12 in cases where:-

1. The defendant had filed an Acknowledgement of Service and/or Defence before the relevant time frame for doing so had expired.
2. The defendant had applied to have the claimant’s statement of case struck out [link to article on making an application to strike out a statement of case] under CPR Rule 3.4 or for Summary Judgment under CPR Part 24 before the Default Judgment was applied for and that Application has not been determined.
3. The whole of the claim against the defendant was satisfied before the Default Judgment was requested

Discretionary grounds for setting aside Default Judgment

If none of the above criteria are met it may still be possible to have the Default Judgment set aside.

CPR 13.3 lists the cases where Default Judgment may be set aside or varied.

CPR 13.3 applies to cases that meet the following criteria:-

1. The defendant has a real prospect of successfully defending the claim, OR
2. It appears to the court that there is some other good reason why the Default Judgment should be set aside or varied or the defendant ought to be allowed to defend the claim.

‘Some other good reason’

The wording of CPR Rule 13.3 may seem quite vague as to what a ‘good reason’ to set aside a Default Judgment would actually be. However, the wording gives the court broad discretion to assess the context of each individual case, rather than providing a concrete list of reasons to adhere to (which may otherwise have the unintended consequence of excluding other reasons).

A common example of a ‘good reason’ is if the claimant incorrectly served the claim on the defendant at an old address even though the defendant had provided them with express notice that they had moved. In such circumstances the defendant will not have been served at their usual or last known residence as required by CPR Rule 6.9. It is also possible to secure the setting aside of Default Judgment if the claimant was not aware that the defendant had changed addresses.

If the defendant believes that their case meets the above criteria they can apply to the court to have the Default Judgment set aside.

It is often prudent to enquire as to whether the claimant is prepared to agree that the Default Judgment be set aside by consent. In that event the matter can be dealt with by way of a Consent Order.

If the claimant is not prepared to proceed on that basis it will be necessary for the defendant (or their solicitor) to prepare an N244 Application Form and documents in support, as will often include a witness statement, exhibit and draft Defence. Details entered on the N244 Application Form will set out the grounds on which the defendant says the Default Judgment must or ought to be set aside and often seeks a stay of any enforcement pending determination of the Application. More information on the enforcement of a Default Judgment can be found in our article here. [Enforcing a monetary Judgment].

Thereafter the N244 Application Form must be filed with the court for issuing together with payment of the Application fee which is currently £275.00. Further guidance on court fees can be found here.

Once issued the N244 Application and documents in support must be served on the claimant and the Application will be listed for hearing so as to afford the claimant the opportunity to oppose the same.

If the court determines the Application in favour of the defendant then the Default Judgment will be set aside, no further enforcement action may be taken thereon and the Judgment will be removed from the Register at Registry Trust Limited.

Thereafter the claim will re-enter the ordinary court process, the first step thereafter being for the defendant to reply to the claim by filing and service of a Defence (and Counterclaim).

In accordance with CPR Rule 13.3(2) in considering whether to set aside or vary a Default Judgment, the matters to which the Court must have regard include whether the person making the Application did so promptly.