3.37: Application for judgment against defendant noted in default
9.15: Setting aside, varying and discharging judgments and orders

Case Summary

The Defendants failed to file a Statement of Defence or Demand for Notice in the Action. As a result, they were noted in default and Judgment was granted against them on a without notice basis. The Defendants applied to set the Default Judgement aside. Justice Ross dismissed their Application because it did not meet the requirements to set aside the Noting in Default or set aside Default Judgment.

Under 3.37(1)(a), a Plaintiff may apply without notice for Judgment if one or more Defendants are noted in default. The Court may grant Judgment under Rule 3.37(3)(a) or direct the claim to proceed to Trial under Rule 3.37(3)(f). The Plaintiffs had noted the Defendants in default and filed a without notice desk Application for Default Judgment. The Application was successful, and Default Judgment was granted against the Defendants.

The Defendants applied to set aside the Default Judgment under Rule 9.15 citing that the Plaintiffs took improper steps to obtain it. Generally, a Party can apply under Rule 9.15(1)(a) to set aside a Judgment that has been obtained without notice. Rule 9.15(3)(b) empowers the Court with discretion to set it aside on any terms it considers just. However, the Application must be brought by the Defendant within the 20-day period contemplated by Rule 9.15(2).

Justice Ross outlined the relevant principles on an Application to set aside Default Judgment under Rule 9.15. First, the Plaintiff must act in the utmost good faith and in strict compliance with the Rules because Default Judgment is not an adjudication on the merits. Second, the Defendant must demonstrate: (a) an arguable defence, (b) that it did not deliberately let Judgment go by default and provide a valid excuse for the default, and (c) that it acted promptly to open up the Default Judgment.

On the first point, Ross J. found that the Plaintiffs acted in good faith and complied with the Rules in obtaining Default Judgment. There was no procedural flaw and their representations on the without notice application were accurate. On the second point, the Court found that the Defendants failed to provide evidence of an arguable defence. While the Defendants did not deliberately let the Judgment go by default, they failed to apply to set it aside within the 20-day period contemplated by Rule 9.15. Given these two findings, the Court did not have to determine whether the Defendant moved promptly to open up the Default Judgment. Accordingly, it dismissed the Defendants’ Application.

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