Chapter 20
Default Judgment
20.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . 261
20.2 Cases where default judgment may
not be entered . . . . . . . . . . . . . . . . . . . . . 262
20.3 Conditions for entering judgment in
default . . . . . . . . . . . . . . . . . . . . . . . . . . . 262
20.4 Request for default judgment . . . . . . . . . 262
20.5 Claim for specified sum . . . . . . . . . . . . . . 263
20.6 Claim for unspecified sum . . . . . . . . . . . . 263
20.7 Claims against the Crown . . . . . . . . . . . . 264
20.8 Application for default judgment. . . . . . . 264
20.9 Application procedure . . . . . . . . . . . . . . . 265
20.10 Two or more defendants . . . . . . . . . . . . . 265
Setting aside a default judgment. . . . . . . 266
20.11 Principles upon which a default
judgment will be set aside. . . . . . . . . . . . 266
20.12 Where the default judgment was
entered wrongly . . . . . . . . . . . . . . . . . . . 266
20.13 Where the default judgment was not
entered wrongly. . . . . . . . . . . . . . . . . . . . 266
20.14 Defendant unaware that service has
been deemed to have occurred . . . . . . . . 267
20.15 Real prospect of success . . . . . . . . . . . . . 268
20.16 Discretion to set aside . . . . . . . . . . . . . . . 268
20.17 Setting aside under the Service
Regulation . . . . . . . . . . . . . . . . . . . . . . . 269
20.18 Procedure . . . . . . . . . . . . . . . . . . . . . . . . 269
20.19 Setting aside on conditions . . . . . . . . . . . 269
20.20 Former duty of claimant to set aside a
wrongly entered default judgment. . . . . .269
20.21 Default judgment on an additional
claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . .270
The following procedural checklists, which are in appendix 1, are relevant to this chapter:
Procedural checklist 16 Request for entry of judgment in default
Procedural checklist 17 Application for entry of judgment in default
INTRODUCTION
Failure to file an acknowledgment or a defence within the time limits laid down in the CPR 20.1
may result under Part 12 in the claimant entering judgment in default, that is, judgment
without a trial of the claim. In most cases the entry of judgment in default is a purely
administrative act, not involving any judicial determination of the merits of the claim.
There are two mechanisms under the rules for entering default judgment:
(a) A simple request-for-judgment procedure under Part 12 is available in money claims
(r. 12.4(1)), which include claims for specified sums, claims for unquantified damages
and some other types of claim. Under this procedure, judgment is entered over the
counter on filing a request for default judgment, without any consideration of the merits
of the claim. (See 20.3 to 20.6.) This will apply in the overwhelming majority of cases.
(b) In a claim for a remedy other than a money claim, in a claim only for costs (other than
fixed costs) and in certain other cases set out in r. 12.10, an application for judgment
must be made using the Part 23 procedure (see chapter 32). On an application for the
entry of a default judgment there will be a hearing and the court will give ‘such judgment
as it appears to the court that the claimant is entitled to on his statement of case’
(r. 12.11(1)). In this case, then, the court will, in a limited way, consider the merits of the
claim. (See 20.8 to 20.9.)
A default judgment obtained using the request procedure in error instead of the applicationfor-judgment procedure was irregular and capable of being set aside as of right under r. 13.2
(Intense Investments Ltd v Development Ventures Ltd [2005] EWHC 1726 (TCC), [2005] BLR 478 (see
further 20.12).
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CASES WHERE DEFAULT JUDGMENT MAY NOT BE ENTERED
20.2 CPR, r. 12.2, and PD 12, para. 1.2, provide that judgment in default may not be entered:
(a) on a claim where the Part 8 procedure has been used (see further 13.9);
(b) on a claim for ‘delivery of goods’ (i.e., delivery up of goods) subject to an agreement
regulated by the Consumer Credit Act 1974; and
(c) in any case where a practice direction provides that a claimant may not obtain a default
judgment.
Default judgment cannot be obtained in a possession claim to which CPR, Part 55, applies
(r. 55.7(4)) or in a probate claim (r. 57.10(1)). In the Admiralty Court the procedure is
modified by r. 61.9 and PD 61, para. 8.1. Default judgment cannot be obtained in
arbitration claims under CPR, Part 62, because they are brought under the Part 8 procedure
(rr. 62.3(1) and 62.13(1)). Nor can default judgment be entered in a case involving a claim
for provisional damages, unless the claimant abandons the claim for provisional damages. If
the defendant does not file his acknowledgment or defence in time, and the claimant does not
wish to abandon the claim for provisional damages, he should apply to the court for
directions under Part 23 (PD 41, para. 5.1).
Where a defendant has made an admission, the correct response is for the claimant to proceed
under CPR, Part 14 (see chapter 17), rather than by way of entry of judgment in default.
CONDITIONS FOR ENTERING JUDGMENT IN DEFAULT
20.3 In order to enter judgment in default, the court is required by CPR, r. 12.3, and PD 12,
para. 4.1, to be satisfied:
(a) that the particulars of claim have been served (a certificate of service on the court file will
be sufficient evidence where service was effected by the claimant);
(b) that either the defendant has not filed an acknowledgment of service or has not filed a
defence, and, in either case, time for doing so has expired;
(c) that the defendant has not satisfied the claim;
(d) that the defendant has not filed or served an admission together with a request for time to
pay;
(e) that the defendant has not made an application to strike out the claim or for summary
judgment which has not been disposed of; and
(f ) where it is sought to enter judgment in default against a child or patient, that a litigation
friend has been appointed.
Point (a) does not have to be satisfied in the Commercial and Mercantile Courts, where
default judgment may be entered before the claimant has served particulars of claim (CPR,
rr. 58.8 and 59.7).
For the purpose of (b) above, the filing of any document purporting to be a defence will
prevent the claimant obtaining judgment in default (PD 12, para. 1.1). If a purported
defence discloses no substantial grounds of defence, the claimant may consider applying to
strike it out (see chapter 33) or may seek summary judgment (see chapter 34).
REQUEST FOR DEFAULT JUDGMENT
20.4 The procedure for requesting entry of judgment in default is summarised in procedural
checklist 16, which is in appendix 1.
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Default Judgment
By CPR, r. 12.4, a claimant may obtain judgment in default by filing a form requesting
judgment to be entered where the claim is for:
(a) a specified sum of money (save where the claim is only for costs other than fixed costs);
(b) an amount of money to be decided by the court;
(c) delivery of goods where the claim form gives the defendant the alternative of paying their
value; or
(d) any combination of these remedies.
If the claimant (rather than the court) served the claim form, judgment in default cannot be
obtained unless a certificate of service of the claim form has been filed (r. 6.14(2)).
Judgment in default can be obtained under r. 12.4 for a claim which includes a claim or
claims for a remedy other than money provided the non-money claims are abandoned in the
request form (r. 12.4(3)). However, where this is done and default judgment is entered only
to be later set aside, the abandoned claim will be restored when judgment is set aside (r. 13.6).
Claim for specified sum
To obtain judgment in default on a claim for a specified sum, the claimant files a request for 20.5
judgment in form N205A or N225.
Judgment will be entered for the amount sought in the claim form, plus fixed costs (set out in
the table at CPR, r. 45.4, and see chapter 67). Alternatively, the claimant may give the
defendant time to pay or permit the defendant to pay in instalments. This is done by setting
out the rate and times of payment acceptable in the request for judgment form. Judgment will
then be entered on this basis (r. 12.5).
By r. 12.6, the default judgment will include interest on claims for specified sums which has
accrued due up to the date on which the default judgment was entered, provided that:
(a) full particulars of interest were set out in the particulars of claim;
(b) on a claim for statutory interest, the rate sought is no higher than that payable on
judgment debts; and
(c) the request for judgment sets out a calculation of the interest claimed between the date
to which interest has been calculated in the claim form, and the date of the request for
judgment.
Otherwise, judgment will be entered for interest to be decided by the court (r. 12.6(2)).
Claim for unspecified sum
To obtain judgment in default on a claim for an unspecified sum, the claimant files form 20.6
N205B or N227 and judgment will be for an amount to be decided by the court, plus costs
(CPR, r. 12.5(3)). A default judgment on liability for an amount to be decided by the court
is conclusive on liability in respect of all matters pleaded. But all questions going to
quantification of the damage remain open. Any point may be raised by the defendant at the
assessment of damages, provided it is consistent with the judgment on liability. Thus it is not
open to the defendant to say that its acts or omissions had not caused any damage, but it
could say that its acts or omissions had not caused certain individual items of damage (Lunnun
v Singh (1999) The Times, 19 July 1999, followed in Pugh v Cantor Fitzgerald International [2001]
EWCA Civ 307, The Times, 19 March 2001).
In any case where the court enters judgment for:
(a) an amount to be decided by the court,
(b) the value of goods to be decided by the court, or
(c) interest to be decided by the court,
it will also give any directions it considers appropriate and may allocate the case to a track
(r. 12.7). However, it will normally only allocate the case (other than in small claims track
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cases) where there is a substantial dispute between the parties as to the amount payable
(PD 26, para. 12.3).
The detailed procedure governing the assessment of damages is set out in PD 26, para. 12.
On the entry of the default judgment, the court will fix an appointment for a disposal
hearing, at which it may either give case management directions, or, where it has sufficient
information, quantify the claim immediately. Where the value of the claim is below the limit
for the small claims track, the court will allocate the case to that track and may treat the
disposal hearing as the final hearing of the case (PD 26, para. 12.3(2)). The types of order the
court may make are set out in PD 26, para. 12.2, and include the filing of allocation
questionnaires and stays for the purpose of ADR. The court may also fix further hearings,
and, to enable it to come to a decision on quantum, it might order disclosure, the filing of
expert evidence and the exchange of witness statements on the issues which remain live
between the parties.
Claims against the Crown
20.7 Default judgment in claims against the Crown may now be entered upon filing a request for
judgment. An application is no longer necessary. However, a request for a default judgment
against the Crown must be considered by a master or district judge, who must be satisfied that
the claim form and particulars of claim have been properly served on the Crown in
accordance with the Crown Proceedings Act 1947, s. 18, and CPR, r. 6.5(8).
APPLICATION FOR DEFAULT JUDGMENT
20.8 The procedure for applying for entry of judgment in default is summarised in procedural
checklist 17, which is in appendix 1.
CPR, rr. 12.9(1)(b) and 12.10, and PD 12, para. 2.3, specify certain types of claim on which
default judgment may only be obtained by making an application under CPR, Part 23. Cases
where the claimant must make an application are where:
(a) The claim is:
(i) not a money claim;
(ii) a claim against a child or patient;
(iii) a claim in tort by one spouse or civil partner against the other;
(iv) a claim for costs other than fixed costs;
(v) for delivery up of goods where the defendant will not be allowed the alternative of
paying their value; or
(b) The defendant is:
(i) a person who has been served with the claim out of the jurisdiction without the
court’s permission under r. 6.19(1) or (1A);
(ii) a State;
(iii) a diplomatic agent who enjoys diplomatic immunity by virtue of the Diplomatic
Privileges Act 1964;
(v) a person or organisation which enjoys immunity from civil claims under the
International Organisations Acts 1968 and 1981.
A claimant who has served a claim form and particulars of claim on a child or patient cannot
apply immediately for default judgment, because no step may be taken in the proceedings
(other than issuing and serving a claim form) until a litigation friend has been appointed
for the defendant (CPR, r. 21.3(2)). Therefore, the correct procedure is to apply for
the appointment of a litigation friend under r. 21.6 before applying for default judgment
(PD 12, para. 4.2(1)).
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Where service is effected under Council Regulation (EU) No. 1348/2000 (the Service
Regulation), judgment in default cannot be given until it is established that service was
effected by a method prescribed by the internal law of the receiving State or that the
documents were actually delivered to the defendant or to the defendant’s residence by another
method provided by the Regulation and that, in either case, the defendant had sufficient time
to defend the claim (art. 19).
Application procedure
A notice of application for default judgment must be filed in accordance with the procedure 20.9
in CPR, Part 23. Where the defendant is an individual, the claimant must provide the
defendant’s date of birth (if known) in part C of the application notice, for use in the
registration of judgments (r. 12.4(2)). Notice of the application must then be given to the
defendant in all cases except claims served under r. 6.19 and claims against a State where the
defendant has not acknowledged service (r. 12.11(4); PD 12, para. 5.1).
A defendant who seeks to prevent judgment being entered in default by filing an
acknowledgment of service or a defence on or just before the hearing must apply for an
extension of time. Whether permission will be granted is a matter for the court’s discretion,
but normally it will be exercised in favour of extending time where, in the case of late
acknowledgement, it is a genuine preliminary to a defence to the claim (Coll v Tattum (2001)
The Times, 3 December 2001, followed in Boeing Capital Corporation v Wells Fargo Bank Northwest
[2003] EWHC 1364 (Comm), LTL 17/7/2003). Neither of these cases considers the test to be applied
in evaluating the genuineness of the defence. However, logically, the defence must have a real
prospect of success within the meaning of Swain v Hillman [2001] 1 All ER 91 and E. D. and F. Man
Liquid Products Ltd v Patel [2003] EWCA Civ 472, [2003] CPLR 384.
There will be a hearing, and judgment will be entered for what it appears to the court that the
claimant is entitled to on the statement of case (CPR, r. 12.11(1)). In other words, the court
will consider the merits of the claim, albeit only as they appear in the particulars of claim.
On an application for default judgment against a child or a patient or a claim in tort
between spouses or civil partners, evidence must be produced to satisfy the court that the
claimant is entitled to the judgment claimed (r. 12.11; PD 12, para. 4.2).
On an application for default judgment in a claim where service was effected under the
Civil Jurisdiction and Judgments Act 1982 or a claim against a foreign State, evidence must
establish the points listed in PD 12, paras 4.3 or 4.4, respectively, and must be given by
affidavit (para. 4.5).
TWO OR MORE DEFENDANTS
If there are two or more defendants, the claimant may obtain a judgment on request against 20.10
one defendant and proceed with the claim against any other defendants (CPR, r. 12.8(1)).
However, where a claimant applies for default judgment against some defendants and not
others, the court will only enter default judgment where the claim can be dealt with separately
from the claim against other defendants (r. 12.8(2)).
Having obtained the default judgment, a claimant may enforce it against only some
defendants, save where it is for the possession of land or delivery of goods. Here, the
defendant may enforce only after obtaining judgment against all defendants, or where the
court gives its permission (r. 12.8(3)).
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SETTING ASIDE A DEFAULT JUDGMENT
Principles upon which a default judgment will be set aside
20.11 A defendant against whom judgment in default has been entered may apply for it to be varied
or set aside under CPR, Part 13.
A judgment which has been entered wrongly (as defined in the CPR) must be set aside by the
court. In other cases, the court has a discretion to set the judgment aside and it will normally
require the defendant to show a real prospect of successfully defending the claim before it will
do so.
In any case where the court sets aside a default judgment, it may attach conditions, such as the
payment of money into court (r. 3.1(3)).
Where the default judgment was entered wrongly
20.12 The court must set aside any judgment entered wrongly (CPR, r. 13.2). The phrase ‘entered
wrongly’ is defined precisely under the rules. By r. 13.2(a) to (c), it is limited to the following
cases:
(a) time for acknowledging service, or for serving a defence (as the case may be) had not
expired by the time the default judgment was entered;
(b) a summary judgment application or an application to strike out the claim made by the
defendant was pending when the default judgment was entered; or
(c) the defendant had satisfied the whole claim or, on a money claim, filed an admission and
a request for time to pay at the time the default judgment was entered.
Judgment was set aside as of right under r. 13.2(a) in Credit Agricole Indosuez v Unicof Ltd [2003]
EWHC 77 (Comm), LTL 4/2/2003. The claimant purported to serve the claim form by leaving it
with the defendant’s company secretary in Kenya, whereas service in Kenya had to be by
leaving the claim form at the company’s registered office. As the claim form had not been
served, the defendant was entitled to have the judgment set aside. In Shiblaq v Sadikoglu [2004]
EWHC 1890 (Comm), [2004] 2 All ER (Comm) 596, the court took the same approach.
Where service in a foreign jurisdiction has not complied with local law, neither r. 6.8 (by
which the court may grant an order for service by an alternative method) nor r. 6.9 (by which
the court may dispense with service) can normally be used either retrospectively to cure the
defect in service or prospectively to authorise a different form of service to that permitted in
the country of service. Nor can r. 3.10 be used to cure an error in service. (See further 16.54.)
A default judgment obtained using the request procedure in error instead of the application
for judgment procedure was irregular and capable of being set aside as of right under r. 13.2
(Intense Investments Ltd v Development Ventures Ltd [2005] EWHC 1762 (TCC), [2005] BLR 478). It is
submitted that this decision ignores the constraints of r. 13.2 which specifies precisely the
circumstances in which the court must set aside a default judgment. These do not include
using the wrong procedure to enter the default judgment.
WHERE THE DEFAULT JUDGMENT WAS NOT ENTERED WRONGLY
20.13 The court has a discretion to set aside a default judgment which was not entered wrongly.
It may exercise its discretion if (CPR, r. 13.3(1)):
(a) the defendant has a real prospect of successfully defending the claim; or
(b) it appears to the court that there is some other good reason why:
(i) the judgment should be set aside or varied; or
(ii) the defendant should be allowed to defend the claim.
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In considering whether to set aside or vary a judgment entered under Part 12, the matters
to which the court must have regard include whether the person seeking to set aside the
judgment made an application to do so promptly (r. 13.3(2)).
The wording of r. 13.3(1)(a) mirrors the test established in Alpine Bulk Transport Co. Inc. v Saudi
that the defendant must have a case with a
reasonable prospect of success, and it is not enough to show a merely arguable defence. In E. D.
and F. Man Liquid Products Ltd v Patel [2003] EWCA Civ 472, [2003] CPLR 384, the Court of Appeal
confirmed that the test is the same as the test for summary judgment. The only significant
difference is that in a summary judgment application the burden of proof rests on the
claimant to show that the defendant has no real prospect of success whereas in an application
to set aside a default judgment it is for the defendant to show that his defence has a real
prospect of success. For this reason it might be harder for a defendant to succeed in an
application to set aside than to resist an application for summary judgment. The test was
considered in detail in Swain v Hillman [2001] 1 All ER 91 (see 34.10).
Eagle Shipping Co. Inc. [1986] 2 Lloyd’s Rep 221,
There may be a good reason for setting aside a default judgment under r. 13.3(1)(b) where
a claimant has an unanswerable claim which would effectively be lost if the judgment were
not set aside (Messer Griesheim GmbH v Goyal MG Gases Pvt Ltd [2006] EWHC 79 (Comm), The Times,
14 February 2006).
Defendant unaware that service has been deemed to have occurred
Once it is proved (such as by a certificate of service) that proceedings have been served by 20.14
one of the methods prescribed by the CPR, service is deemed to take effect on the date laid
down by r. 6.7, and evidence to prove the contrary is not admissible (see Anderton v Clwyd
County Council (No. 2) [2002] EWCA Civ 933, [2002] 1 WLR 3174). Where a default judgment
has been entered after the expiry of 14 days from the deemed date of service in a case where
the defendant did not in fact receive the proceedings, setting aside is subject to the court’s
discretion rather than as of right (Godwin v Swindon Borough Council [2001] EWCA Civ 1478,
[2002] 1 WLR 997). The decisions in Anderton v Clwyd County Council (No. 2) and Godwin v
Swindon Borough Council concerned the effect of the deeming provisions on a claimant who
delays serving a claim form until the end of the period for service. However, in Akram v
Adam [2004] EWCA Civ 1601, [2005] 1 WLR 2762, the Court of Appeal looked at the position of a
defendant who says that he had no notice of the proceedings at all until after he heard of the
default judgment. The court dismissed the contention that a defendant in this situation
should be entitled to have the judgment set aside as of right on the grounds that he had
received no notification of the proceedings and was therefore a stranger to them. It also held
that the deeming provisions on service in the CPR did not contravene the European
Convention on Human Rights, art. 6 in the Human Rights Act 1998, sch. 1. It confirmed
that a judgment entered on a claim served in accordance with the rules, but of which the
defendant had no notice, has not been entered wrongly and the defendant can have it set aside
only on the grounds specified in CPR, r. 13.3(1) (see 20.13). Such a defendant will therefore
either have to show a defence with a real prospect of success, or rely on non-service as ‘some
other good reason’ for setting aside the judgment. According to May LJ in Godwin v Swindon
Borough Council at [49] this may arise where a defendant would have paid instead of having an
embarrassing judgment entered, and it may give grounds for departing from the usual rule of
the defendant being ordered to pay the costs thrown away (see 66.26). In Manx Electricity
Authority v JP Morgan Chase Bank [2002] EWHC 867 (Comm), LTL 16/5/2002, the court agreed that a
judgment entered in this situation should be set aside under r. 13.3(1)(b); alternatively that
the claimant should have taken steps under r. 13.5 to set aside the judgment (see 20.20).
Doubts about the effectiveness of alternative service in the circumstances of the case appear to
have been treated as a factor in setting aside a default judgment in Black Arrow Finance Ltd v
Orderdaily Co. Ltd [2002] EWCA Civ 289, LTL 31/1/2002.
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Real prospect of success
20.15 In International Finance Corporation v Utexafrica sprl [2001] CLC 1361 it was stated that the test in
CPR, r. 13.3(1)(a), of having a real prospect of success means that the prospects must be
better than merely arguable. In E. D. and F. Man Liquid Products Ltd v Patel [2003] EWCA Civ 472,
[2003] CPLR 384, the Court of Appeal confirmed this proposition and that the test is higher
than it was under RSC, ord. 14.
Discretion to set aside
20.16 In Rahman v Rahman (1999) LTL 26/11/99 the court considered the nature of the discretion to set
aside a default judgment under CPR, r. 13.3. It concluded that the elements the judge had to
consider were the nature of the defence, the period of delay (i.e., why the application to set
aside had not been made before), any prejudice the claimant was likely to suffer if the default
judgment was set aside, and the overriding objective.
In Thorn plc v Macdonald [1999] CPLR 660 the Court of Appeal approved the following
principles:
(a) while the length of any delay by the defendant must be taken into account, any pre-action
delay is irrelevant;
(b) any failure by the defendant to provide a good explanation for the delay is a factor to be
taken into account, but is not always a reason to refuse to set aside;
(c) the primary considerations are whether there is a defence with a real prospect of success,
and that justice should be done; and
(d) prejudice (or the absence of it) to the claimant also has to be taken into account.
In Law v St Margarets Insurance Ltd [2001] EWCA Civ 30, LTL 18/1/2001, the Court of Appeal
allowed judgment in default to be set aside despite the defendant’s solicitors’ procedural
errors in failing to file an acknowledgment of service and in failing to ensure that the
statement of truth in relation to the evidence in support of the application was signed by the
right person. The overriding objective required that the default judgment be set aside in order
to enable the merits of the defence to be determined.
In Lloyds Investment (Scandinavia) Ltd v Ager-Hansen (2001) LTL 7/11/2001 a default judgment was
set aside on the ground that the defendant had a real prospect of success. Although the
claimant had raised serious questions about the defendant’s credibility, no finding could be
made without oral evidence and cross-examination.
Where summary judgment had been refused against defendants who appeared on the
application but default judgment had been entered against a defendant who did not appear,
the court subsequently set aside the default judgment, because there had been no examination
of the evidence against that defendant. Given that the question of a real prospect of
successfully defending the claim had been determined in favour of the defendants who had
filed defences, it would have been wrong to come to a different conclusion in relation to the
defendant who had not participated (Huntingdon Life Sciences Ltd v Stop Huntingdon Animal
Cruelty [2004] EWHC 3145 (QB), LTL 11/11/2004).
The privilege against self-incrimination does not afford an excuse for failing to serve a defence
with a realistic prospect of success, and will not provide grounds for setting aside a judgment
in default (Versailles Trade Finance Ltd v Clough [2001] EWCA Civ 1509, [2002] CP Rep 8).
The provisions governing default judgments in Admiralty claims are in r. 61.9. Although
r. 61.9(5) gives the court power to set aside a default judgment, it does not prescribe the
criteria. It was held in The Selby Paradigm [2004] EWHC 1804 (Admlty), [2004] 2 Lloyd’s Rep 714,
that the burden on the defendant is to show that it has a real prospect of success in defending
the claim, and is not akin to that imposed on an appellant.
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Setting aside under the Service Regulation
Where service was effected under Council Regulation (EU) No. 1348/2000 (the Service 20.17
Regulation), the court has power under art. 19(4) to relieve the defendant from the effect of
any judgment entered in default if:
(a) the defendant, without any fault on his part, did not have knowledge of the documents
served in sufficient time to defend; and
(b) the defendant discloses a prima facie defence to the claim on its merits.
Procedure
A defendant must apply for judgment in default to be varied or set aside under the Part 23 20.18
procedure (see chapter 32). An application to set aside a default judgment which has not been
entered wrongly must be supported by evidence (CPR, r. 13.4(3)). Commonly, a draft
defence is attached to a witness statement in support of the application.
Where the claim is for a specified sum of money, has not been started in a specialist list and
the judgment is entered against an individual in a court which is not the defendant’s home
court (defined in r. 2.3(1)), the court will automatically transfer the application there
(r. 13.4(1)).
If the defendant has entered into a funding arrangement (as defined in r. 43.2(1)(k)) and the
application to set aside default judgment is the first document to be filed by the defendant, a
notice of funding of case (form N251) must be filed at court with the application and a copy
served on every other party (PD 43–48, para. 19.2(3)).
Setting aside on conditions
If the court sets aside a default judgment, it may do so on terms (CPR, r. 3.1(3)). In most 20.19
cases the defaulting defendant will be ordered to pay the claimant’s costs thrown away. In
addition, the court may consider imposing a condition that the defendant must pay a
specified sum of money into court to await the final disposal of the claim. This is effectively a
sanction requiring the defendant to pay the money immediately (albeit into court), rather
than being able to wait until judgment. The sum paid into court also assists the claimant, who
obtains a secure fund from which the amount found due can be paid, which also operates as a
secured fund if the defendant becomes insolvent (Re Ford [1900] 2 QB 211).
In deciding whether to impose such a condition, the court will consider factors such as
whether there was any delay in applying to set aside, doubts about the strength of the defence
on the merits, and conduct of the defendant indicating a risk of dissipation of assets (see
Creasey v Breachwood Motors Ltd [1993] BCLC 480). As to the amount, this is in the court’s
discretion, which should be exercised applying the overriding objective. However, a condition
requiring payment into court of a sum that the defendant will find impossible to pay ought
not to be ordered (M. V. Yorke Motors v Edwards [1982] 1 WLR 444; Training in Compliance Ltd v
Dewse (2000) LTL 2/10/2000), as that would be tantamount to refusing to set aside.
The court may also find it appropriate to exercise other of its case management powers under
r. 3.1(2). For example, it may order trial of a preliminary issue raised in any draft defence or
allow judgment to be set aside on the issues raised in the draft defence which have a real
prospect of success and not on those which do not.
FORMER DUTY OF CLAIMANT TO SET ASIDE A WRONGLY
ENTERED DEFAULT JUDGMENT
The provision formerly in CPR, r. 13.5, which placed a duty on a claimant who had entered 20.20
default judgment, but subsequently became aware that the particulars of claim had not
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Part E
Responding to a Claim
reached the defendant before judgment was entered, to request that the default judgment be
set aside or apply for directions, has been revoked. It was inconsistent with the policy that
there is an irrevocable presumption of service on the date set out in r. 6.7 on proof of one of
the permitted methods of service under r. 6.2. See 15.35 and Anderton v Clwyd County Council
(No. 2) [2002] EWCA Civ 933, [2002] 1 WLR 3174.
DEFAULT JUDGMENT ON AN ADDITIONAL CLAIM
20.21 There are special rules which apply in relation to entering judgment in default on an
additional claim. These are dealt with in 29.10.
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