Even when every precaution is taken to ensure compliance with the civil procedure rules (CPR), given the ever-increasing volume of claims it is inevitable that some cases will fall foul of the strict timeframes laid down in the rules.
If the deadline relating to the acknowledgment of the service of proceedings is missed, the Trust may find that default judgment is obtained against them.
The law - CPR Part 13
CPR 13.2 and 13.3 contain the court rules that cover the setting aside of default judgment. The court must allow an application to set aside default judgment if that judgment has been wrongly entered (CPR 13.2) but the court also has discretion to set aside a default judgment (CPR 13.3).
CPR 13.3 has two strands (and an applicant can apply with reference to either or both):
- CPR 13.3(1)(a): The court requires the defendant to show a ‘real prospect of successfully defending the claim’ (this requires obtaining evidence to support the application);or
- CPR13.3(1)(b): ‘some other good reason’ why the default judgment should be set aside or be varied or the defendant should be allowed to defend the claim.
The court will also consider whether the application was made promptly; whether an applicant ‘had acted with all reasonable celerity in the circumstances’ (Regency Rolls Limited and Anor –v- Carnall  EWCA (Civ) 379).
A defendant should always attempt to explain any delay and stress (if applicable) that there will be no prejudice to the claimant if the judgment is set aside.
Hockley -v- North Lincolnshire and Goole NHS Trust (unreported) (19 September 2014)
In Hockley the defendant had failed to file an acknowledgement of service within the 14 days permitted by CPR 10.3(1), filing the acknowledgment 13 days late. The claimant secured default judgment, which was subsequently set aside following the defendant’s application, which was made utilising the ‘some other good reason’ strand of CPR 13.3(1). The claimant sought to have the default judgment restored.
On appeal, Judge Jeremy Richardson QC was of the view that the defendant’s default was ‘serious’, and that CPR 3.9 (relating to application for relief from sanctions) was relevant. He noted that the defendant did not file a draft defence (or other material) with their application so as to allow the court to conclude that there was a real prospect of defending the claim.
The starting point was to show there was a good reason for setting aside the default judgment. It was held that the defendant had failed to show a good reason. Further that the filing of an acknowledgment of service is not a trivial or unimportant step in the litigation as shown by the adverse consequences attached to the failure to do so.
The judge was of the view that the three stage test in Denton had considerable relevance to an application to set aside default judgment on the ‘good reason’ ground, in that there has to be a genuinely good reason and the court must embrace the scrutiny of the seriousness of the default and why it occurred.
This case is helpful in clarifying the position regarding sanction and default in a post Mitchell and Denton era. It serves as a reminder that evidence in support of an application to set aside a default judgment is crucial. Also, using both strands of CPR 13.3 will provide greater strength to an application. An application referencing ‘some other good reason’ alone should be avoided.
Tips for case managers: to avoid default judgment
Prevention is better than cure – always seek to avoid default judgment being entered at all costs:
- Be aware that an acknowledgment of service must be filed within fourteen days of deemed service.
- When proceedings are received, notify the NHS LA immediately.
- Highlight clearly that proceedings have been served and the date of service, so that the document is not misinterpreted as general post.
In the event that it becomes necessary to file an application to set aside default judgment, prioritise enquiries and investigations, so that evidence can be submitted in support of the application, showing a real prospect of defending the claim where possible, to provide better prospects of success.