M. Rohde Construction -v- Nicholas Markham-David
Case reference:
[2006] EWHC 814 (TCC)
Monday, 20 March 2006
Key terms: Default Judgment - Setting Aside - Service effected - Breach of Natural Justice
This was an application to set aside a default judgment obtained by Rohde Construction. The proceedings arose out of an adjudication, which took place in 2001.
By way of background the defendant engaged the claimant to carry out building works. The claimant proceeded with those works but there were differences between the parties in relation to the quality of work delays and other issues. The defendant made payments on account but the claimant contended that additional sums were due. The defendant declined to pay these additional sums, as it did not believe that they were due and the claimant decided to refer his claim to adjudication.
One of the issues in these proceedings was whether the claimant successfully served notice of adjudication on the defendant. The claimant purported to serve the notice of adjudication on 30 March 2001 by sending it to an address, which was a rental property, owned by the defendant. In the course of the adjudication various other communications were sent to this address all of which were returned undelivered. The defendant says he did not receive any of the communications relating to the adjudication as he was in dispute with the tenant at the address of the property communications were delivered to.
The claimant was awarded £37,528 by default and made an application in the Technology and Construction Court in November 2001 to recover these monies. The claimant again served the documents to the defendant’s rental property and also to the home of the defendant’s former wife. The defendant stated that his marriage had broken down and his former wife was not passing any documents received by her.
The defendant did not respond or acknowledge these and in March 2002 the court entered judgment in default.
The defendant stated he was unaware of the litigation until October 2005. In the month that he became aware of the litigation he applied to have the default judgment of March 2002 set aside. The defendant argued that he had a real prospect of defending the action and there was a good reason why he did not respond sooner namely that he was unaware of the proceedings.
The key question considered by Justice Jackson was whether or not the defendant was aware or should have been aware of the adjudication. The defendant raised the point that the claimant was aware of where his business operated from as he had previously carried out work there on behalf of the defendant. The defendant contended that the claimant deliberately avoided contacting him. Justice Jackson said he was not prepared to make a finding in relation to the conduct of the claimant but needed to consider whether in a situation where the defendant is unaware of proceedings an adjudicator’s award should be enforced.
Justice Jackson said that he was satisfied that the defendant had a real prospect of success and had concluded that the defendant was unaware of the present proceedings until October 2005.
Justice Jackson said he had to weigh up the competing factors of the prejudice, which the claimant would suffer if the judgment were set aside, and the prejudice the defendant would suffer if it were not.
Justice Jackson considered that the prejudice caused to the defendant outweighed the prejudice caused to the claimant and that therefore set aside the default judgment. Justice Jackson noted the speed with which the defendant had moved to make his application once becoming aware of the adjudication and default judgment were factors he had taken into account in reaching this decision.
By way of background the defendant engaged the claimant to carry out building works. The claimant proceeded with those works but there were differences between the parties in relation to the quality of work delays and other issues. The defendant made payments on account but the claimant contended that additional sums were due. The defendant declined to pay these additional sums, as it did not believe that they were due and the claimant decided to refer his claim to adjudication.
One of the issues in these proceedings was whether the claimant successfully served notice of adjudication on the defendant. The claimant purported to serve the notice of adjudication on 30 March 2001 by sending it to an address, which was a rental property, owned by the defendant. In the course of the adjudication various other communications were sent to this address all of which were returned undelivered. The defendant says he did not receive any of the communications relating to the adjudication as he was in dispute with the tenant at the address of the property communications were delivered to.
The claimant was awarded £37,528 by default and made an application in the Technology and Construction Court in November 2001 to recover these monies. The claimant again served the documents to the defendant’s rental property and also to the home of the defendant’s former wife. The defendant stated that his marriage had broken down and his former wife was not passing any documents received by her.
The defendant did not respond or acknowledge these and in March 2002 the court entered judgment in default.
The defendant stated he was unaware of the litigation until October 2005. In the month that he became aware of the litigation he applied to have the default judgment of March 2002 set aside. The defendant argued that he had a real prospect of defending the action and there was a good reason why he did not respond sooner namely that he was unaware of the proceedings.
The key question considered by Justice Jackson was whether or not the defendant was aware or should have been aware of the adjudication. The defendant raised the point that the claimant was aware of where his business operated from as he had previously carried out work there on behalf of the defendant. The defendant contended that the claimant deliberately avoided contacting him. Justice Jackson said he was not prepared to make a finding in relation to the conduct of the claimant but needed to consider whether in a situation where the defendant is unaware of proceedings an adjudicator’s award should be enforced.
Justice Jackson said that he was satisfied that the defendant had a real prospect of success and had concluded that the defendant was unaware of the present proceedings until October 2005.
Justice Jackson said he had to weigh up the competing factors of the prejudice, which the claimant would suffer if the judgment were set aside, and the prejudice the defendant would suffer if it were not.
Justice Jackson considered that the prejudice caused to the defendant outweighed the prejudice caused to the claimant and that therefore set aside the default judgment. Justice Jackson noted the speed with which the defendant had moved to make his application once becoming aware of the adjudication and default judgment were factors he had taken into account in reaching this decision.