The appellant (together with another claimant) filed a claim form for possession of a furnished residential property, arrears of rent and other relief, totalling £13,634. The respondent did not acknowledge or respond to the claim form and a judgment was made in the appellant’s favour.
It subsequently emerged that the respondent’s address had been incorrectly stated on the claim form and that the respondent had not received it. Thus, the respondent was unaware of the proceedings until it learnt of the judgment against it. It issued an application notice, stating that it intended to apply for an order to set aside the judgment against it, on the ground that the claim form had not been served at its address. The district judge held that the respondent was not entitled to have the judgment set aside as of right, holding that, in order to have it set aside, the respondent would have to demonstrate that it had a reasonable prospect of success at trial, in accordance with CPR 39.3(5).
The county court judge reversed the decision of the district judge. He contended that if it was determined that, in breach of the CPR, a claimant had failed to serve a notice on the defendant and the latter was unaware of the proceedings against it before judgment, justification for the exercise of the court’s jurisdiction had to be found. Accordingly, he ordered that the judgment be set aside.
The appellant (the first claimant) appealed but the second claimant did not. The question for the Court of Appeal was whether a defendant would normally be entitled to an order setting aside a judgment obtained against it if it could show that it had not been served with the claim form in accordance with the CPR.
Held: The appeal was dismissed.
The county court judge had been correct to hold that CPR 39.3(5) did not apply to an application to set aside an irregular judgment of this kind.
CPR 39.3 did not apply where a defendant had not been served with proceedings in accordance with the rules and was not aware of the proceedings. The rule contemplated a trial in the absence of a party that had been served under the CPR, or in respect of which service had been dispensed with.
The attempted service of a notice at the wrong address was an “error of procedure” that the court could remedy under its wide and unfettered discretion under CPR 3.10 or 3.1(2)(m). The discretion to set aside an irregular judgment was not to be exercised only by setting aside the judgment. Circumstances might arise in which the overriding objective of justice, which included saving expense and dealing with the case proportionately, required the discretion to be exercised differently.
Each case depended upon its own facts, but, unless the defendant would not suffer prejudice or it was guilty of inexcusable delay in making its application, the just order would almost always be to set aside the judgment: White v Weston [1968] 2 QB 647 and Akram v Adam (No 2) [2004] EWCA Civ 1601; [2005] 1 WLR 2762 considered.
If a claimant could show inexcusable delay on the part of that the defendant, the court would be entitled not to make an order on the defendant’s application. The judgment would then stand (subject to any direction by the court in relation to statutory interest accruing on the judgment or otherwise).
Geraint Jones QC (instructed by the second claimant in the court below under the bar licensed access scheme) appeared for the first appellant; Robert Smith (instructed by Restons, of York) appeared for the respondent.
Eileen O’Grady, barrister
