Towarzystwo Ubezpieczen Interpolska SA v Roger Mann

In an application under CPR 13.3 to set aside a regularly obtained default judgment, the court must consider whether the defendant has a real prospect of successfully defending the claim or some other good reason for relief. Promptness is a mandatory and important consideration, reflecting the public interest in finality. The court must assess all relevant circumstances, including the nature and extent of delay, its explanation, the defence’s strength, prejudice and the justice of the case. Even a defence with a real prospect of success may be insufficient where delay and the surrounding circumstances make relief unjust. An appellate court will not interfere with a discretionary decision unless there is an error of principle, procedural unfairness, failure to consider relevant matters, or a plainly wrong outcome.

The claimant pursued damages arising from negligent cosmetic surgery in Poland. The first defendant, the insurer of the clinic, failed to acknowledge service and judgment in default was entered on 31 August 2017. It later applied under CPR 13.3 to set aside the judgment, relying on proposed defences concerning the contractual relationship, policy scope, causation and the policy limit.

Master Thornett refused relief, finding serious and inadequately explained delay, weak proposed defences and prejudice to the claimant. The insurer appealed, alleging errors in the assessment of its prospects of success and the treatment of delay. The central issue was whether the Master had made an appealable error in exercising the discretion under CPR 13.3.

1. Appeal dismissed. The Master’s refusal to set aside the default judgment disclosed no error of law, principle or approach.
2. Under CPR 13.3, the court’s discretion is directed to avoiding injustice. It must consider the defendant’s real prospect of successfully defending the claim or another good reason for relief, together with all relevant circumstances. Promptness is mandatory and important. A marked delay may justify refusal even where the proposed defence has a real prospect of success. The court must also consider the reason and extent of delay, the defence’s strength, prejudice, finality and the overriding objective.
3. The Master was entitled to treat the insurer’s delay as gross and damaging. The relevant history began before formal service, including the insurer’s earlier full denial of liability and subsequent notifications. The insurer’s explanations were vague and unsupported. The claimant had reasonably relied on the default judgment and would suffer practical prejudice if liability had to be revisited.
4. The Master had not conducted a mini-trial. He was entitled to assess the evidence, draw reasonable inferences and reject the insurer’s proposed arguments concerning the surgeon’s relationship with the clinic, policy coverage and the indemnity limit. Even if some defence had a real prospect of success, refusal of relief remained justified in the circumstances.
5. The court treated Mitchell and Denton as relevant by analogy through the Court of Appeal authorities, but did not decide whether those principles formally apply to CPR 13.3 applications. Either approach produced the same result.
6. The court accepted that, following the default judgment, issues of causation remained open as to particular items of loss, but the insurer could not contend that the insured acts caused no loss at all. The appeal was dismissed.

• High Court (King’s Bench Division): appeal from Master Thornett’s refusal to set aside judgment in default under CPR 13.3. Appeal dismissed.