How Do I Set Aside a Default Judgment?

If a person or company files a claim and the defendant fails to respond, the court can conclude the case in the defendant’s absence. It’ll only do so if certain conditions are satisfied, and it prevents parties from simply ignoring claims and dragging matters out. 

When receiving this type of judgment, you might wonder how and why it’s been made against you. You may not have been aware of the existence of a claim, in which case receiving such a document can come as a shock. Additionally, you’ll want a chance to defend yourself and explain your position before a judge makes a final decision. 

Luckily, it is possible to challenge these orders, ask the court to set them aside and allow you to submit your defence. These are important and fairly high-risk applications. If the application is made but fails, even for a technical reason, a Judgment obtained against you can remain even if you might have had a defence.

Below, we explain default judgments, their consequences, and how and when you can challenge them. For more information, contact Helix Law. Our expert commercial litigation team are experienced in these types of applications and situations. 

What is a Default Judgment?

The Civil Procedure Rules (CPR) define it as a judgment without trial where a defendant either fails to acknowledge a claim’s service or files a defence. Service refers to the proper delivery of claim documents and will only be deemed effective if it complies with the relevant procedure rules. For example, it must be sent to the correct address and person within the appropriate time frame. 

An acknowledgement of service is a document that must be completed and filed by the defendant to confirm that they received the relevant papers. A defendant has 14 days to file their acknowledgement. If they file an acknowledgement of service, they have 28 days from the date they received the claim to file their defence. 

Therefore, if the Defendant doesn’t file an acknowledgement of service within 14 days of serving their claim and doesn’t file their defence within a further 14 days, the Claimant can apply for a default judgment. The court will only make a default judgment order if it’s satisfied the defendant failed to respond within the relevant time frames. 

What Are the Consequences of a Default Judgment?

A default judgment is a judgment. It is enforceable against any defendant, including against their assets. Colloquially, this is known as a ‘CCJ’ or a County Court Judgment. Default Judgment’s can also be obtained in the High Court. These immediately impact the Defendant’s credit rating when registered. Registration of a judgment usually takes place within approximately 30 days of the order being made. 

As with any order, you are bound by the terms and content unless and until you set it aside. Ignoring an order can lead to severe consequences, and it’s vital you know how to manage this situation. 

The court determines the exact terms of a default judgment, but without seeing a defence, the order often favours the claimant. If it’s a money claim relating to a specified amount, the claimant can ask that you pay it by a specific date or state the payment terms for instalments. If it’s an unspecified amount, the court will decide how much you must pay and by what date. 

For example, you may receive an order stating you must pay the claimant £10,000 within 28 days. Usually, the court orders the sum payable immediately. Unless you apply to set this aside, you will be legally required to settle this payment immediately. If you do not do so, the Claimant can pursue your assets or your insolvency. 

If you fail to comply with the order, the claimant can access a range of enforcement options. The most appropriate steps will depend on the individual situation. Options include:

• A charging order against your property so that when you sell or remortgage it, the amount owed is deducted and paid to the claimant;
• The seizure and sale of your property, including your home;
• An attachment of the earnings order so your employer deducts monthly instalments from your salary until you settle the debt;
• An order monies be deducted from savings, shares or investments and paid towards the debt; or
• Bankruptcy proceedings if the debt is over £5,000.

What Action To Take if Default Judgment Has Been Entered Against You

Upon receiving the order, you must read it carefully. A judgment means a claim has been issued against you. You need to know the details and consider your defence and best approach. One of the factors the court will consider in an application to set aside judgment is how promptly you have made the application. 

You should, therefore, file your application as soon as possible, but first, you should establish the following:

• Whether you received the claim and, if so, why you didn’t respond
• Any evidence you have to demonstrate you didn’t receive the documents or why you failed to file an acknowledgement of service or defence
• Whether you accept or dispute all or part of the claim. You should gather evidence to support your position if you intend to defend it. 

You should speak to a solicitor as soon as you receive the order to understand your prospects of successfully setting aside the order and defending the claim. These are technical applications- it is not a given or foregone conclusion that a default judgment will be set aside. 

If you fail, the judgment will remain against you. A specialist litigation solicitor can advise you on the best approach to ensure you don’t waste your time or money. 

How Long Do You Have to Get a Default Judgment Set Aside?

Unless specified in the order, there’s no standard deadline by which you must apply to set it aside. However, when considering whether to grant your application, the court will look at how ‘promptly’ you made it, as above. Typically, you must illustrate you have been proactive since you have become aware of the judgment and claim against you.

The law doesn’t define ‘promptly’, but the more you can demonstrate a proactive approach to preparing and filing your documents, the better. The court understands you need time to seek legal advice and prepare a robust application, so as long as you speak to a specialist litigation solicitor straight away, this shouldn’t be an issue. 

Once you’ve sent your application, the time it takes to set the order aside depends on the particular court you’re in, its backlog of cases, the complexity of your case, and availability for hearings. It could be anything from a few weeks to a few months.

Grounds on Which a Default Judgment Must Be Set Aside

The court will only set aside the order if your evidence satisfies one of the Civil Procedure Rules criteria. CPR 13.2 details the grounds on which the court must set aside the judgment, known as the ‘mandatory’ grounds. CPR 13.3 provides the cases where it may do so but is not obligated to, known as the ‘discretionary’ grounds. 

Mandatory Grounds

The court must set aside the default judgment if you can demonstrate that:

• You filed an acknowledgement of service or defence within the relevant time frame
• You applied to strike out the case or ask for a summary judgment, but the court hasn’t yet dealt with it
• You already satisfied the whole claim
• You admitted liability but requested more time to pay

A strike-out or summary judgment is an order dismissing a claim because there are no reasonable grounds for the court to consider it. Sometimes, due to court delays, applications overlap, so an order could still be made against you despite your having applied for a strike-out. 

If applying under mandatory grounds, you must provide the relevant documentary evidence, such as a copy of your filed defence or proof you’ve already done what the claimant is asking. 

Discretionary Grounds

The court may set aside the order if you can show that:

• You have a reasonable prospect of successfully defending the claim
• There is another good reason why it should set it aside or allow you to defend the claim. 

If you base your application on one of the discretionary grounds, providing strong evidence to support your position is crucial. To satisfy the court, your defence must have a reasonable prospect of succeeding, and you must show that it’s realistic and more than simply arguable, even if its chances of success are small. 

Therefore, putting together a solid defence to file with your application to set aside is advisable. 

Applying to Set Aside a Default Judgment

It’s vital that you file your application correctly and comply with the relevant procedure so the court can receive and process it and ultimately succeed. Completing the wrong form or filing it with the wrong court could result in the judgment remaining in force and you losing your chance to challenge it. 

There are three key documents you must prepare:

• The application through Form N244, providing your contact details and the reasons for applying. 
• A draft order stating how you want the judgment to be varied or set aside. The court usually only expects this if you have a solicitor or barrister representing you. 
• Supporting evidence, whether in the form of witness statements or other documents. There’s a small space in the N244 to explain your position, but you can attach a more detailed account if necessary. Usually, this type of application will be supported by a detailed witness statement exhibiting several documents.

Once you’ve finalised the above documents, you must:

• Send them to the correct court, which is usually the same one that ordered the default judgment, but be sure to double-check. If you have a solicitor, they’ll file it for you. It’s advisable to send it by first-class post and email. 
• Pay the court fee, which is currently £303. For up-to-date fees, check form EX50A. 
• Send a copy of your application and supporting documents to the claimant. You must ensure your service method is effective and that the claimant receives the documents at least three clear days before the hearing date to deal with the application.

The court will send you a hearing notice with the date and time you must attend to discuss your application. If you’ve instructed a solicitor, the court should send the notice to them directly. However, if you receive it, you should inform your legal representative immediately so they can start preparing for the hearing. 

At the hearing, a judge will review the papers and hear submissions from both parties. They will then make one of the following orders:

• An order granting your application and setting aside the default judgment;
• An order dismissing your application, meaning the judgment will remain in force
• Directions for a further hearing if it needs more evidence before making a decision. 

If your application is successful, the judge will set a further hearing date for case management regarding the original claim. You can also ask them to order the defendant to pay your costs arising from your application to set aside, but this isn’t guaranteed. 

If you have applied on discretionary grounds, the usual order, or at least the starting point, is that you might be ordered to pay the Claimants’ costs in the application as well as your own. That’s on the basis that there is some fault—for example, you haven’t acted promptly or within the necessary timescales.

Frequently Asked Questions 

Can the Court Set Aside a Default Judgment of Its Own Accord?

The court may set aside the order of its own accord if it considers it null and void, for example, due to a fundamental error. However, this doesn’t mean you shouldn’t file a detailed application to cover all bases and ensure the best chances of success. It’s an important application that must be made in accordance with the Civil Procedure Rules.

How Long Does It Take to Have a Default Judgment Set Aside?

The time it takes to set aside the order depends on various factors, including the specific court, its resources, the case’s complexity, and the application’s urgency. The entire process should take a few weeks to a few months, but speak to your legal adviser for a more accurate estimate. 

Need Advice? Contact Helix Law

You may have received a default judgment without knowing why or want to know how to challenge it successfully. Receiving a document like this can be shocking, as it may be the first time you’re learning about a claim against you. Navigating the law and procedural rules can also feel daunting, and it’s essential you understand your options. 

Contact Helix Law today for further assistance. Our team of specialist litigation solicitors have a wealth of knowledge on setting aside default judgments and defending claims. We’re experts in managing complex cases and provide tailored advice so you feel confident about how to proceed. We’ll prepare the necessary documents for your approval, communicate with the court and claimant, and ensure your interests are properly represented.