Setting aside Default Judgement

What is a Default Judgment?

A default judgment usually occurs when a defendant fails to file a defence in response to the plaintiff’s claim. When this happens, the plaintiff may make request that the Court grant judgment for the relief sought by the plaintiff ‘by default’. A default judgement effectively disposes of the action without a trial and without further consideration of the merits of the defendant’s case.

However, the Court also has the power and discretion to set aside or vary a default judgement in some circumstances. There is no absolute entitlement to a default judgement, and a Court will always have the discretion to refuse a request for default judgement if it is of the view that the default judgement may result in an injustice, such as where the relief sought is inappropriate.

In Queensland, a defendant has 28 days to respond to a claim against them from the date they are served with the plaintiff’s claim and statement of claim. Commonly, the defendant will respond by filing a:

  • Form 6 – Notice of Intention to Defend; and
  • Form 17 – Defence

If the defendant considers there is some form of irregularity or issue with the claim against them, such as where they have not been served properly or they believe the court does not have the requisite jurisdiction to hear the matter, the defendant may file a Form 7 – Conditional Notice of Intention to Defend.

If the defendant fails to respond to the claim within 28 days, the plaintiff may file a request for default judgment.

Typically, the amount sought is awarded. This is the most common type of default judgment.

Where the relief claimed requires some consideration, the Court can award default judgment that is conditional on assessment. The plaintiff will then need to provide the Court with relevant material to show that the amount they are claiming is appropriate. When this happens, the defendant can also provide material to the Court if they think that the relief claimed is inappropriate. However, in assessing damages, the Court will not consider the merits of a defendant’s case. That will only be done if the defendant makes an application to set aside the default judgment, and the application is successful.

A defendant who has had a default judgment made against them can apply to the Court to have the default judgment set aside to allow the defendant the opportunity to defend the claim against them.

The Court will exercise its discretion in deciding whether or not to set aside a default judgment and, in doing so, will consider a number of factors, including the reasons for the failure to file a defence, the defendant’s conduct before and after the decision was made, and whether the plaintiff would be irreparably prejudiced in the event that the judgment was set aside.

When will the Court set aside a Default Judgement?

A default judgment can be set aside where:
     
  1. The judgment was obtained irregularly – A judgment will be considered irregular where there has been some failure to follow appropriate procedures in making the decision. For example, the defendant might dispute whether or not they were properly served with the Court documents. Just because you have received documents does not mean you were properly served. Also, if an application for default judgment was premature, that could unravel the entire judgment. This is another mistake that is made all too commonly.
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  3. The defendant can provide some explanation for their failure to file a defence – The defendant might be able to provide reasonable justification for why a defence was not filed in time (for example, they were in prison or in hospital), but even if there is no excuse, provided that there has not been an extended delay and the person has some defence, the court will usually set aside default judgment. Anything over a year is typically quite difficult to set aside, whereas anything under 6 months is less difficult. However, what amounts to a ‘delay’ will be a question for the circumstances of the case.
  1. The defendant has a prima facie defence to the plaintiff’s claim – The defendant usually must have a ‘prima facie’ defence, meaning that it has some prospects of success, rather than being simply fanciful. This is by far the most important consideration, and even where a defendant cannot satisfy the other factors, the Court is much more likely to set aside a default judgment where the defendant can show a prima facie defence.
Setting aside default judgment is not as hard as you may think. As litigation lawyers we can usually come up with a prima facie defence on your behalf. Even if you think you owe some or all of the money, we may still be able to negotiate a better outcome for you.

How we can help you

If you have had a default judgment made against you it is important to seek immediate legal advice so you can make an urgent application to the Court to have the default judgment set aside. If you delay in bringing your application, you may lose the opportunity to plead your case, even if you have a valid defence.

When a default judgment has been made against you, the plaintiff is entitled to commence enforcement proceedings against you if you do not comply with the judgment. This could have serious consequences, particularly if you are not in a position to comply with the judgment order.

Our litigation lawyers are able to assist you with any aspect of your default judgment matter – we can help you take immediate court action to protect your rights and limit your liability.

Contact Gibbs Wright Limitation Lawyers today for a free and confidential consultation discussing your legal rights and remedies.

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