12. Default Judgment and Summary Judgment

Question 1

What is default judgment?

Answer 1

Default judgment means judgment without a trial where a defendant has failed to file an acknowledgement of service or a defence

Question 2

Where may default judgment not be obtained?

Answer 2

Claims for delivery of goods subject to an agreement regulated by the consumer credit act 1974
Where they use the part 8 procedure
In any other case where a rule or PD says they cannot

(a) The defendant has applied for a strike out
(b) Or for summary judgment
And the application has not been dealt with
The defendant has satisfied the whole claim (including costs) on which the claimant is seeking judgment
The claimant is seeking judgment on a claim for money; and The defendant has admitted liability to pay but requested time; or
Notice has been given of a persons intention to make an application for a declaration in relation to the proceedings and that application has not been dealt with

Question 3

What are the conditions to be satisfied for default judgment?

Answer 3

In respect of an acknowledgement of service:
(a) Only if at the date on which judgment is entered
a. The defendant has not filed an acknowledgement of service or defence; and
b. The relevant time has expired
In respect of a defence:
(a) Where an acknowledgement of service has been filed but, at the date on which judgment is entered a defence has not been filed
(b) In a counter claim made, where at the date of judgment a defence has not been filed
(c) And, in either case the relevant time for doing so has expired

Question 4

What is the procedure for obtaining default judgment?

Answer 4

1. May obtain by filing a request in the relevant form where the claim is for:
   (a) A specified amount of money
   (b) An amount of money to be decided
   (c) Delivery of goods where the claim form gives the defendant the alternative of paying their value
   (d) Any combination o those remedies
   Where the defendant is an individual, the claimant must provide the defendants Dob if known where required
2. Must be made in accordance with part 23 if they wish to obtain default judgment:
   (a) On a claim which consists of or includes a claim for any other remedy
   (b) Or where CPR 12.10/12.11 says so,
   And where the defendant is an individual, the defendants dob must be provided if known.
3. Where a claimant claims any other remedy in addition to those within paragraph 1 but abandons that claim, they may still obtain default judgment under paragraph 1

Question 5

In proceedings against the Crown, who must determine an application for default judgment and what must they do?

Answer 5

A master or Dj who must be satisfied that the claim form and particulars have been properly served in accordance with cpr 12.10

Question 6

May a claimant request the judgment to specify times and dates for its execution?

Answer 6

Yes, it may specify the date by which the whole is to be paid or the times and rate of any instalments.
Where default judgment is given will be judgment for the amount of the claim to be paid by the date or rate specified or, if none are specified, immediately.

Question 7

How should the claimant file for default judgment where it is for an unspecified amount of money?

Answer 7

It will be for an amount to be decided by the court together with costs

Question 8

What will default judgment for a claim for delivery of goods where the claim form gives an option of paying their value consist of?

Answer 8

It will be judgment requiring the defendant to deliver the goods or pay the value of the goods as decided (less any payments made) and pay costs
The claimant’s right to enter judgment requiring deliverance of goods is subject to CPR 40.14

Question 9

May default judgment include interest?

Answer 9

Yes if:
The POCs included the details required
The rate claimed is no higher than the interest payable on judgment debts (if claimed under 35a and s69)
The claimant’s request for judgment includes a calculation of interest from the date up to which interest was calculated in the claim form up to the date of the request for judgment

In every other case, judgment will be for an amount of interest to be decided by the court

Question 10

May the claimant obtain default judgment where there is more than one defendant?

Answer 10

On a claim for money or delivery of goods, they may claim for it against one of the two or more defendants and proceed with the claim against the other
If the claim can be dealt with separately
* The court may enter a default judgment and
* The claimant may continue with the claim against the other defendants
if it cannot be dealt with separately:
* The court will not enter default judgment and
* The court must deal with the application at the same time as it deals with the claim against the other defendants

Question 11

May a claimant enforce against one of two or more defendants a judgment obtained for possession of land or for delivery of goods where the judgment is default judgment?

Answer 11

No, unless:
(a) They have obtained judgment for possession or delivery against all defendants; or
(b) The court gives permission

Question 12

When must the claimant obtain default judgment via part 23?

Answer 12

Where the claim is:
(a) A claim against a child or protected party; or
(b) A claim in tort by one spouse or civil partner against the other

Question 13

Where must the court set aside a default judgment entered?

Answer 13

The court must set aside a judgment entered if judgment was wrongly entered because:
(a) In the case of a judgment in default of an acknowledgment of service where they had not been passed the relevant time/they had so filed or they had applied to strike out a statement of case
(b) In the case of a judgment in default of a defence, it had been filed/the time hadn’t elapsed yet or they had applied to strike out
(c) The whole of the claim was satisfied before judgment

Question 14

Where may the court set aside or vary default judgment?

Answer 14

If:
(a) The defendant has a real prospect of successfully defending the claim (not enough to show an arguable defence); or
(b) If appears to the court there is some other good reason to vary, set aside, or allow the defendant to defend the claim
In considering this, the court must have regard to whether the person seeking to set aside made an application to do so promptly
Must act in accordance with the overriding objective
Court may decide not to where no notice of the hearing has been given
Where a condition is put on to a grant of set aside or vary but the party cannot comply, it is tantamount to a refusal
Technical failures by the claimant cannot be relied on by the defendant
A decision for this is a final decision

Question 15

What may constitute some other good reason to set aside?

Answer 15

It is a broad one.
Where an allegation is a serious one, this may be a good reason
Failure to serve a response pack may constitute this
Where there was significant delay to warn the defendant of the issue of claim form or to invite D to accept service, this may constitute good reason as it would lull D into believing the claim was not being pursued or may lull him into forgetting about it
Cancellation of judgment obtained in a different country may not constitute good reason
A declaration that the claimant’s charge was void when granting default judgment on a counterclaim was not some other good reason

Question 16

How significant is promptness for setting aside?

Answer 16

Very. Court may be justified to set aside or vary because of it.
Depends on facts of the case.
Power is not exercised to punish a party bc of incompetence however.
Doing nothing until the creditor sought to enforce the judgment and then applying to set aside is an abuse of process.
Strong public interest in finality of litigation

Question 17

Must an application to set aside default judgment include evidence?

Answer 17

Yes, should include evidence of why the delay occurred.

Question 18

Can an application to set aside/vary default judgment be made by a non-party?

Answer 18

Yes, they can be joined as a separate defendant. Parties who are directly affected by a judgment or order may apply to have it set aside.

Question 19

Is an application to vary or set aside a default judgment an application for relief from any sanction within the meaning of CPR 3.9?

Answer 19

Yes, thus the Denton criteria apply.

Question 20

What is the criteria when deciding an application to vary or set aside a default judgment?

Answer 20

First, the 13.3 tests (merits of the case and delay)
Afterwards, Denton test:
(i) identify and assess the seriousness and significance of the failure to comply with any rule, practice direction or court order which engages rule 3.9(1) ;
(ii) consider why the default occurred;
(iii) evaluate all the circumstances of the case, so as to enable the court to deal justly with the application

Question 21

What is the procedure for deciding an application to vary or set aside a default judgment?

Answer 21

1. Where:
   a. The claim is for a specified amount of money;
   b. The judgment was obtained in a court which is not the defendant’s home court;
   c. The claim has not been transferred, or, in the county court, send to another defendant’s home court; and
   d. The defendant is an individual
   In the high court the court will transfer or, in the county, the court officer will send, an application by a defendant to the defendant’s home court (except where in a special list)
2. Where:
   a. The claim is for a specified amount of money;
   b. The claim has been started in the CNBC;
   c. The claim has not been send to a hearing centre; and
   d. The defendant is not an individual
   The claim will be sent to the preferred hearing centre (any further correspondence should also be sent here
   Evidence must be included in these

Question 22

Which CPR part regulates summary judgment?

Answer 22

CPR 24 (though is subject to other parts making special provision)
Technically lays out the procedure merely for where the court may decide a claim or issue without a trial

Question 23

What proceedings is summary judgment available?

Answer 23

(a) Against a claimant in any type
(b) Against a defendant in any type except:
a. Proceedings for possession of residential premises against a mortgagor or tenant or contract-holder, against a former tenant or former contract-holder holding over with a protected occupancy

Question 24

What are the grounds for summary judgment?

Answer 24

The court may give such judgment against a claimant or defendant on the whole or on an issue if:
(a) It considers the party has no real prospect of succeeding in the claim, defence, or issue; and
(b) There is no other compelling reason why the case or issue should be disposed of at a trial

Question 25

What does ‘no real prospect of succeeding’ mean for summary judgment?

Answer 25

Following principles:
(a) Court must consider whether the claimant has a realistic as opposed to a ‘fanciful’ prospect of success
(b) A ‘realistic’ claim is one that carries some degree of conviction. This means a claim that is more than merely arguable
(c) In reaching its conclusion, the court must not conduct a mini trial
(d) Does not mean the court should take at face value everything the claimant says – some analysis is required. It may be clear from the documents that what the claimant says is factually untrue
(e) But it must be aware of the fact that more documents may become available at trial that are not available here
(f) Where reasonable grounds exist for believing that a fuller investigation would add to or alter the evidence available and so affect the outcome of the case, the court should hesitate from making summary judgment, even where the conflict at this point is simple
(g) Although, it may be that the issue is a point of law and, if it has all necessary evidence before it for its proper determination and the parties have had an adequate opportunity to address it, it should grasp the nettle and decide it. Should again remain conscious of the fact more evidence may come up later where it is likely to exist and can be expected to be available at trial. Not enough to merely say something may turn up

Question 26

What does ‘no realistic prospect of success’ mean for summary judgment?

Answer 26

(a) Need to show they have a real rather than a fanciful success which is one that is more than merely arguable and carries some degree of conviction
(b) It does not have a prospect where (a) it is possible to say with confidence that the entire factual basis for the claim is fanciful because it is entirely without substance; or (b) the claimant does not have material to support at least a prima facie case that the allegations are correct; and/or (c) the claim has pleaded insufficient facts in support of their case to enable the court to draw necessary inferences
(c) The court is entitled to reject a version of the facts which is implausible, self-contradictory or not support by the contemporaneous documents and it is appropriate for the court to consider whether the proposed pleading is coherent and contains the properly particularised elements of the cause of action relied upon

Question 27

What does it mean where there should be no mini-trial for summary judgment?

Answer 27

Guidance as to what is meant is provided by the decision of the Supreme Court in Okapbi v Royal Dutch Shell Plc.

Question 28

What guidance is given on whether evidence can be reasonably expected to be available at trial for summary judgment?

Answer 28

Whether there are reasonable grounds for believing that disclosure may materially add to or alter the evidence relevant to whether the claim has a real prospect of success
It is not enough to say that something may turn up.

Question 29

What guidance is given in respect of ‘short points of law and construction’ for summary judgment?

Answer 29

Shortness relates to the length of the hearing and complexity of the matrix of fact (not to the shortness of the document it needs to consider). Nonetheless, there may be some points of law that are best left to be decided at trial. If some issues turn on expert evidence, an application for SJ would usually be inappropriate unless made after the exchange of experts’ reports and after the experts have discussed the case and produced a joint statement

Question 30

What is the burden of proof in summary judgment?

Answer 30

Rests on the applicant to establish that there are grounds to believe the respondent has no real prospect of success and there is no other reason for a trial.

The applicant must:
(a) Identify concisely any point of law or provision in a document on which they rely; and/or (b) state the application is made because the applicant believes that, on the evidence, the respondent has no realistic prospect of succeeding or successfully defending the claim and in either case state the applicant knows of no other reason why the disposal should await the trial.
If there is credible evidence in support of the application, the respondent comes under the evidential burden to prove some real prospect of success. If relying on evidence that will be available at trial, it must serve evidence substantiating that claim by at least generally describing the nature of the evidence, its source, and its relevant.

Question 31

What does ‘no other compelling reason why the case or issue should be disposed of at trial’ mean for summary judgment?

Answer 31

The fact the claimant was in liquidation was a compelling reason to refuse SJ where there were latent and crossclaims between the parties.
Where similar issues remained to be determined at trial is a compelling reason.
Sj on a short point of construction of the terms of the insurance contract where those terms were standard terms widely use was refused.
Claimant’s case is devious and crafty and not plain and straightforward, where the defendant is an executor or administrator who can raise facts by reference to existence or absence of letters, accounts or such like which may it reasonable to require full investigation.
In cases of libel, slander, malicious prosecution or false imprisonment the respondent has the right to a trial by jury and so may elect that (though the judge can say that a jury could not find on the case was fine).

Question 32

What is the effect or set off or a counterclaim on obtaining summary judgment?

Answer 32

May be prevented in whole or in part where they make a claim with a triable issue.
In some cases, however, SJ may be granted where the claimant’s remedy is enforceable immediately.
Apart from certain cases (no set off clause/no set off in a dishonoured bill or cheque), any SJ where the defendant claims set off would be limited to the top of what the Claimant would be entitled to when set off is deducted. If the original claim is lower than a set off claimed, then no summary judgement will be granted.
If the defendant raises a triable counterclaim which cannot be deployed as a set off the court may grant summary judgement on the claimant but with a stay of enforcement pending the trial of the counterclaim.
If the claim value overtops the alleged value of the counterclaim, the stay of enforcement may be made conditional upon the defendant paying the difference by a specified date. Alternatively, the stay of enforcement may be limited to the alleged value of the counterclaim

Question 33

What is the effect of set off when the original claim is an action on a dishonoured bill or cheque?

Answer 33

Save in exceptional circumstances or upon strong grounds, a defendant is not allowed to set off or counterclaim for damages for breach of some other contracts or commission of a tort, and the claimant is entitled judgement for the amount of their claim without a stay of execution.
This is also the case where the counterclaim is connected with or arises out of the contract in respect of which the bill, cheque or note was given, and whether or not the proceedings were between the immediate parties to the bill.
The principle is that a bill, check or note is given in taking in payment as cash, and not merely as a given right of action for the creditor to litigate a counterclaim.
This rule also precludes a defensive set off to direct debit mandates which were treated as equivalent to cheques.

Question 34

At what stage of the proceedings can application for summary judgement be made?

Answer 34

Only after the defendant has filed an acknowledgement of service or defence unless the court gives permission or a rule or practice direction states otherwise.

Question 35

If a party files for summary judgement before the defendant has given a defence, does that defendant need to give a defence?

Answer 35

Not before the hearing

Question 36

How much notice should be given when a summary judgement application is listed?

Answer 36

14 days’ notice of the date fixed for the hearing and the issues which the court will decide.

Question 37

What should be contained in the application notice for summary judgment?

Answer 37

It must:
(a) State it is an application for SJ
(b) Identify any point or law or document relied upon
(c) Set out or attach any written evidence on which the applicant relies
(d) State the applicant believes the respondent has no real prospect of success on the claim, defence, or issue
(e) State the applicant knows of no reason why the disposal should await trial; and
(f) Draw the respondent’s attention to their right to rely on evidence opposing the application
In a claim for specific performance or recission of an agreement for the sale. Purchase, exchange mortgage or charge of any property or for the grant or assignment of a lease or for the forfeiture or return of any deposit made under such an agreement, it must also contain:
(a) The text of the order sought by the claimant, served not less than 4 days before the hearing

Question 38

If a party wishes to rely on evidence at a summary judgment hearing, when should it be served?

Answer 38

(a) 7 days before the hearing in the case of a respondent’s evidence or evidence of any party where the hearing is fixed by the court of its own initiative
(b) 3 days before the hearing in the case of an applicant’s evidence in reply or reply evidence of any party where the hearing is fixed by the court of its own initiative.
Not required if already filed or served.

Question 39

What orders may the court make after disposal of a summary judgment application?

Answer 39

(a) To give directions to the filing and service of a defence
(b) Give further directions about management
(c) Or make its order subject to conditions (where it appears it may succeed but it is improbable. May ask for a payment of a sum of money or for a party take a specified step and which provides his claim or statement of case will be struck out if he does not comply)
(d) Judgment on the claim or the issue therein (may grant the remedies sought, an order for damages to be assessed, or an order amounting to declaratory relief. May give w/ stay of enforcement incl. where there is a counterclaim).
(e) Striking out or dismissal in favour of the defendant
(f) Dismissal of the application
(g) An order dealing with costs (for example, fixed costs. Where the order does not mention costs, no party is entitled to them relating to that order)

Question 40

What principles apply when considering whether the court should order payment into court or security for costs?

Answer 40

1. The court must not impose a condition requiring payment into court or the provision of security which it is likely to be impossible for the defendant to comply
2. Burden on the defendant to establish on the BOP that it would be unable to comply
3. In order to discharge that burden, the defendant must show that not only does it not itself have the necessary funds but that no such funds would be made available to it, whether by its owner or some other closely associated person
4. It is not incumbent on a defendant to adduce evidence about the resources available to it, at any rate in a case where no prior notice has been given that a claimant will be seeking a conditional order
5. This power to make a conditional order is not limited to a case where it is improbable that the defence will succeed. Such an order may be appropriate in other circumstances, for example if there is a history of failures to comply with orders or a doubt about the bona fides of one side. Should exercise caution before making such an order where the defendant may have a good defence.

Question 41

Can summary judgment/an order made at a SJ hearing be set aside?

Answer 41

Where a party fails to attend a SJ hearing, the court may proceed in their absence. Where it is made in their absence, they may apply to re-list the case for further consideration. However, if at the hearing of the application, the court gives summary judgment against the absent party, the question arises whether that party may apply to have the judgment set aside or varied.
The respondent may apply for the order to be set aside or varied.
The court makes such order as it thinks just.