litigation; interim remedy; default judgment; CPR; set aside; application; london

Judgment set aside: Unfair to serve on empty offices in COVID-19 and prospects of successful defence

The High Court set aside a default judgment because the Claim Form had been served on “empty offices” during the COVID-19 lockdown. Despite the Claimant’s solicitors attempts to engage in pre-action correspondence and check requirements for service, the Court was satisfied that the Defendant showed real prospects of successfully defending the claim.

The High Court set aside a default judgment because the Claim Form had been served on “empty offices” during the COVID-19 lockdown. Despite the Claimant’s solicitors attempts to engage in pre-action correspondence and check requirements for service, the Court was satisfied that the Defendant showed real prospects of successfully defending the claim.

GDPR Data protection breach by the Council

This case concerned a claim issued by Melanie Stanley against London Borough of Tower Hamlets (“the Council”) for breach of the General Data Protection Regulation (“GDPR”). The Claimant had attended a child protection conference and following the conference, the Council disclosed the Claimant’s GP records to those who had attended without the Claimant’s consent. Upon receipt of a complaint by the Claimant, the Council accepted there had been a data protection breach.

Issue of claim for brach of data protection and damages

The Claimant instructed solicitors to issue a claim against the local authority for compensation and claimed damages up to £10,000.

Before the Claim Form and Particulars of Claim were drafted, the Claimant’s solicitors were mindful of their duties under the Civil Procedure Rules to engage in pre-action correspondence.

Claimant’s unsuccessful attempts to engage in pre-action correspondence with the Council

The Claimant’s solicitors sent a letter before claim to the Council by post and email on 23 January 2020. When the Council failed to respond, the Claimant’s solicitors sent a further letter highlighting the Council’s breach of the pre-action protocol (Pre-Action Protocol for Media and Communications Claims for data protection cases) and gave the Council a further seven days to respond.

On 13 February 2020, the Claimant’s solicitor phoned the Council’s Legal Services Department and obtained contact details for the file handler. The Claimant’s solicitor then emailed the file handler warning of the Claimant’s intention to issue proceedings and asked if the Council would accept service of proceedings by email but was told that service had to be by post.

Service of claim form at “empty offices”

On 25 March 2020, two days after the country went into lockdown after government guidance was issued on COVID-19, and over a month since the last contact with the Council, the Claimant’s solicitor, Mr McConville, posted Particulars of Claim to the London Borough of Tower Hamlets’ offices. The deemed date of service (CPR 7), was 27 March 2020 and therefore the Council had to acknowledge service within 14 days i.e. by 9 April 2020.

Due to the lockdown, the Council’s offices were short staffed.

What is default judgment?

If the defendant fails to file a defence within the relevant time limit, the claimant may obtain a judgment in default of defence (under CPR 12), which means that judgment is entered on the claim without a trial. CPR 10.3 and CPR 15 set out the time periods for the filing of the acknowledgement of service and serving the defence.

It is up to the defendant to apply to court to have the judgment set aside or varied (under CPR 13) because he has a real prospect of successfully defending the claim or for some other good reason.

Claimant’s successful application for default judgment

As the Defendant did not file an Acknowledgement of Service, the Claimant’s solicitor made an application to the Court for default judgment under CPR 12 on 15 April 2020 (six days after the Defendant’s deadline to file an Acknowledgment of Service).

The Council had admitted there had been a breach of data protection therefore in the Claimant’s view, there was no real prospect of the Council defending the claim.

The application was granted on 17 April 2020.

Council’s application to set aside default judgment

The Council’s solicitor, Nicola McDougall, filed and served witness evidence in support of the Council’s application to set aside default judgment under CPR 13.3(1) on the basis that:

  • the Council had a real prospect of successfully defending the claim; and/or
  • there is some other good reason.

The Council’s solicitor claimed she was instructed on 27 April 2020 and following contact with the Claimant’s solicitor, she was informed that the Claimant had already obtained default judgment.

She cited that due to the circumstances surrounding COVID-19 and the government ordered lockdown, a lot of the Council’s staff were working from home and that as far as she was aware, the Council’s legal services department had not received the papers.

The Council’s solicitor stated that the Council intended to defend the claim and claimed it was unreasonable for the Claimant’s solicitor to effect service by post knowing that the officers were likely to be shut.

He should have made contact by phone or otherwise to ascertain how to effect service ‘in these unfortunate and unprecedented times’.

Court’s decision on setting aside default judgment

In finding that the reason for the Council’s default was the COVID-19 crisis and that but for the Council’s offices being closed as a result of the lockdown, the Council would have responded in time, the judge set aside the judgment in default.

The Judge held that CPR 13.3 requires an applicant to show that he has real prospects of a successful defence or some other good reason to set the judgment aside. The Judge concluded that this test was satisfied.

The world shifted on its axis on 23 March 2020 and it was incumbent on him as a responsible solicitor and an officer of the court to contact the Council to acknowledge that the situation had changed, and to discuss how proceedings could best and most effectively be served.

I do not find that he unscrupulously took advantage of the situation, but I do find he exercised poor judgement.

Costs of Defendant’s application to set aside

The Council was awarded its costs, after some criticism of the Claimant’s solicitors by the Court.

Costs sanctions are usually imposed on parties who behave unreasonably and many legal advisers may be divided in this case. The Claimant’s solicitors had taken steps to check requirements for service however had not taken extra measures in light of the COVID-19 pandemic. Although they may have had good reasons to defend their actions, their opposition to the opponent’s application to set aside eventually resulted in a costs order against them.

CPR rule 1.3 requires parties to help the court to further the overriding objective. This case serves as a reminder for parties to cooperate, particularly in light of the court’s approach to the current difficulties faced in the COVID-19 pandemic. This may include agreeing extensions of time where possible and agreeing applications by consent thereby avoiding time and costs of the parties and utilisation of the resources of the court.

How do I apply for default judgment?

If you have issued and served a claim and have not received an Acknowledgement of Service or the Defence, you may be entitled to apply for default judgment. CPR 10 and CPR 15 set out the time periods for the filing of the acknowledgement of service and serving the defence.

The rules governing default judgment are set out at Part 12 of the Civil Procedure Rules . Depending on the type of claim, default judgment is sought either by filing a request (CPR 12.4(1) or (3)) or by an application to the Court (CPR 12.4(2)CPR 12.9 and CPR 12.10). CPR 20 governs default judgment for counterclaims.

How do I set aside a default judgment?

CPR 13.2 sets out the circumstances under which the court must set aside a default judgment and under CPR 13.3 the Court exercises its discretion.

An application to set aside default judgment requires an application from relief from sanctions. CPR 3.9 states:

(1) On an application for relief from any sanction imposed for a failure to comply with any rule, practice direction or court order, the court will consider all the circumstances of the case, so as to enable it to deal justly with the application, including the need –
(a) for litigation to be conducted efficiently and at proportionate cost; and
(b) to enforce compliance with rules, practice directions and orders.
(2) An application for relief must be supported by evidence.

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