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No ‘do-overs’ in default judgment case

|Written By Jennifer Brown

When bringing a motion to set aside default judgment defendants better have good evidence and respond quickly, according to a recent Ontario Superior Court decision.

In Marina Bay Sands Pte, Ltd. v. Jian Tu aka Tu Jian, Justice Sean Dunphy wrote on Aug. 7:

The Superior Court is not a sandbox playground where ‘do-overs’ can be expected on demand. The stakes are high and this is no time to keep powder dry. If there is any reason the judgment ought not to stand, any and all reasons must be diligently and properly placed before the court.”

In the Marina Bay case, the defendant, Jian Tu, created a claim to set aside default judgment on what Dunphy called “two slender straws” — a procedural argument based on the exclusive jurisdiction clause in the underlying contract in favour of Singapore laws and courts, and a “bald, second-hand assertion” of failure to receive the statement of claim by means of the substituted service authorized by an order of the court.

Tu brought a motion to set aside the default judgment dated June 28, 2014, and to strike the statement of claim or for leave to file a statement of defence.


Marina Bay, a Singapore hotel, issued the statement of claim on Feb. 18, 2014, for amounts owing under a credit agreement between it and the defendant. The amount claimed was the Canadian dollar equivalent of SGD $9,940,683, plus prejudgment interest arising from advances made in February 2013 that the defendant had failed to repay.

The debts arose from markers given to support gambling at the plaintiff’s casino. A credit history obtained by the plaintiff showed Marina Bay was not the only casino the defendant has obtained credit from — there was a list of other casinos in Ontario and abroad.

Marina Bay had difficulty serving the statement of claim. Three unsuccessful attempts at service were made between March 6 and March 15, 2014, at an address in Markham, Ont. The process server received no reply.

Several other attempts were made to the same address.

On June 28, 2014, default judgment was obtained in the amount of the Canadian-dollar equivalent of SGD $11,127,028.62 plus $2,000 for costs, both amounts bearing post-judgment interest at the rates of 13 per cent and three per cent respectively.

Marina Bay proceeded to register writs of seizure and sale on July 21, 2014, and made a number of attempts to serve the judgment upon Tu via regular and registered mail and courier on several dates from July 23, 2014 to Jan. 2015.

Tu claimed he did not reside at the Markham property during the time the statement of claim was said to be delivered.

The case raised the following issues to be determined:
a) Is the existence of an “exclusive jurisdiction” clause in the contract underlying the default judgment sufficient grounds to warrant setting aside a default judgment?
b.) Does a bare hearsay allegation that the defendant failed in fact to receive a copy of the statement of claim warrant the exercise of the court’s discretion to set aside default judgment under Rule 19.08(1) of the Rules of Civil Procedure?

Dunphy said he did not accept “the evidence that the defendant in fact had no notice of the claim.”

He noted that Marina Bay has been unpaid for almost three years on its liquidated claim, and “had to engage lawyers in Ontario to track down the defendant and has now found property that he owns and has secured a judgment.”

Bald, hearsay statements to that effect which have been made without explanation of the circumstances carry little weight in these circumstances. . . . Secondly, there is a great distinction to be drawn in my mind between an irregularly obtained default judgment and a properly obtained judgment following substituted service in accordance with a validly-obtained order of the court. In the latter case, the judgment is regular. While the interests of justice may well favour setting such a judgment aside if credible evidence is led to establish that the alternative to personal service employed was actually ineffective, such is not automatically the case. Even if I accepted the defendant’s assertion (which I do not), the defendant would have still to explain his delay in responding to the judgment and to provide the court with some indication that he has a bona fide defence on the merits."

Dunphy dismissed the motion with costs.


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