Setting Aside Default Judgments
Published: January 2010
If a judgment or order has been entered against you or your company in default of a Notice of Appearance or Notice of Defence being filed then it is important that any application to the Court to set aside the judgment or order be made promptly and after due consideration of the applicable legal considerations.
If judgment or order is not set aside by the Court then any right to dispute the underlying debt or claim may be lost. The entry of a judgment or order that remains on the Court record is also likely to have an adverse influence upon the credit rating of you or your company.
In applications to set aside orders, which are also known as applications for re-hearing in the Magistrates Court, there is an important distinction between judgments and orders that have been “regularly entered” and those which have been “irregularly entered”.
In deciding upon whether to set aside a regularly entered judgment or order the Court will afford consideration to a number of factors including whether there is an arguable defence, the reasons for which a defence was not filed and served in the first instance and the reasons for any delay in the making of the application. If the application is successful and a regularly entered judgment or order is set aside, it is usually the case that the Court will order that the person making the application pay a part of the other party’s legal costs.
An irregularly entered judgment or order is usually one which suffers from some error or defect such that it should not be on the Court record. An applicant is generally entitled to have an irregularly entered order set aside as of right and, upon the making of a successful application to set aside an irregularly entered judgment or order, the Court will usually order that the other party pay a part of the applicant’s legal costs. The Court is not required to take into account the same considerations as would apply to the setting aside of a regularly entered judgment or order.
If a deadline to file and serve a Notice of Appearance or a Defence has passed, and if a judgment or order has been entered in default of defence, it is important to act promptly to rectify the situation.
Disclaimer
The facts and circumstances applicable to every client are different. The above article is not intended as, nor should it be construed as, legal advice as to the subject matter of the article. Should you have legal issues that are similar to above then you should not place any reliance on the content of this article but, instead, you should seek legal advice.
Related Practice Areas: Commercial Litigation & Disputes
