The mortgage over the borrower’s property secured 4 different loan agreements with the same lender. The lender sought possession upon the borrower’s default in making repayments. A Defence and Amended Defence were struck out with leave to file a Further Amended Defence and any affidavit evidence. No such defence was filed in the time allowed by the Court. As a result, default judgement was entered in favour of the lender.
The borrower sought to have the default judgement set aside. The borrower blamed her own legal advisers for failing to prepare and file a defence in time as instructed by her. She annexed her proposed defence to an affidavit which focussed on the procedural history of the matter.
Justice Davies set out the legal principles where delay is caused by a litigant’s own inaction as distinct from the inaction of their legal advisers, as stated in an earlier case:
In every such case the Court has an inherent and unfettered, though judicial, discretion, in the exercise of which it will, however, necessarily consider (a) whether any useful purpose would be served by setting aside the judgment, and (b) how it came about that the applicant found himself bound by a judgment regularly obtained. As a general rule (although not necessarily in every case, if some reason exists for departing from it), the Court requires an affidavit showing prima facie that the defendant has a good defence on the merits, and also an explanation of his absence which shows that justice requires that in the circumstances it should be excused. And if there has been gross negligence on the defendant’s part, the Court will be the more disposed to require at least a reasonably clear case of merits to be shown, to incline it to interfere.
The Judge emphasised that where a defence depends on the facts there should be evidence of those facts. The borrower’s evidence was largely silent as to the facts concerning entry into the loan agreements, which she broadly alleged were unconscionable, unjust or the result of undue influence exercised by the lender. As a result of that lack of evidence the Judge found she had not shown she had a defence on the merits and refused to set aside the default judgement.
As to her delay in filing a defence her explanation based on an unanswered request for particulars did not cover the period after she had been directed by the Court to file a further amended defence. The delay said to be caused by a car accident was not supported by evidence. The delay caused by her former solicitor’s inaction did not cover the whole of the period of the delay in filing her further defences. She had been given an opportunity to file 2 further defences which she had not taken in the time allowed. As a result, there was no adequate explanation for the delay and for that reason also the Judge refused to set aside default judgement.