Hook Norton Brewery v Collinson

On a second appeal, permission requires a real prospect of success together with an important point of principle or practice, or another compelling reason. Under Civil Procedure Rules rule 13.3, a default judgment may be set aside where the defendant has a real prospect of successfully defending the claim or another good reason exists. A cross-claim must be supported and sufficiently particularised. An unsupported loss calculation does not establish a real prospect. Further evidence will generally be admitted on appeal only where it could not, with due diligence, have been produced below. The availability of a separate damages claim does not itself amount to good reason. A creditor is not bound to accept part payment in settlement of the whole debt.

Hook Norton Brewery obtained default judgment in the County Court for £1,000.85 for beer supplied. The District Judge refused to set it aside, and His Honour Judge Morton-Jack dismissed the defendant’s appeal on 29 June 2000. The defendant sought permission for a second appeal and an extension of time. He relied principally on an alleged agreement concerning beer supplies, an asserted counterclaim for £17,043.59, part payment, the identity of the contracting party, and an alleged lack of opportunity to present his case. The central issue was whether the counterclaim gave him a real prospect of successfully defending the judgment under rule 13.3 and whether the second-appeal threshold was met.

1. Application refused. The application sought permission for a second appeal and an extension of time. Under Civil Procedure Rules rule 52.13, the court had to be satisfied both that the proposed appeal had a real prospect of success and that it raised an important point of principle or practice, or that there was another compelling reason for hearing it. Neither requirement was met.
2. The relevant test for setting aside the default judgment was Civil Procedure Rules rule 13.3. The opening words, in any other case, directed attention to cases not covered by rule 13.2, which concerned procedural irregularity. Rule 13.3 permitted setting aside or variation where the defendant had a real prospect of successfully defending the claim or where there was some other good reason. Promptness was also a matter to which the court had to have regard.
3. The alleged breach of the parties’ arrangement could support a cross-claim, and the court accepted that the brewery had repudiated the arrangement. However, the claimed loss of £17,043.59 was unsupported and unparticularised. Even on the defendant’s figures, the maximum plausible counterclaim appeared to be about £450 or £500. The court therefore could not conclude that there was a real prospect of successfully defending the claim.
4. Further evidence could be admitted on appeal only under strict conditions. The defendant could not show that the evidence could not, with due diligence, have been produced before the earlier courts. Admission would also cause prejudice to the brewery, which had conducted the litigation on the evidence available. The possibility of bringing a separate damages claim, subject to limitation, did not constitute another good reason for setting aside the judgment.
5. The remaining grounds failed. A tender of part payment was insufficient, and the brewery was not bound to accept it in settlement of the whole debt. The wrong-party point was not pursued, and the complaint about the hearing was answered by the defendant’s full opportunity to present his case in the Court of Appeal. Order: application refused.

• County Court at Oxford: The District Judge refused to set aside the default judgment dated 18 December 1999 for £1,000.85.
• County Court at Oxford: His Honour Judge Morton-Jack dismissed the defendant’s appeal by order dated 29 June 2000.
• Court of Appeal (Civil Division): The application for permission to bring a second appeal, including the request for an extension of time, was refused.