A recent CA decision has radically altered the landscape in the world of set-aside applications. It has done this by focusing on the meaning of ‘trial’, and the result is that what many of us have always thought of as a trial, will not be a trial at all. The case involved the possession claim but is of much wider importance.

L obtained a possession order against a long-lessee, T, at a hearing fixed on issue of the claim, which T failed to attend. Although T discovered the existence of the judgment six weeks later, it was not until a further five months later that he applied to set aside the order. The judge made the set-aside order under r39.3(5), which says that the court may grant the application only if (i) the applicant acts promptly, (ii) has a good reason for not attending, and (iii) has a reasonable prospect of success at trial. His application was granted, but L appealed to the CA on the basis that T had not acted ‘promptly’.

That appeal failed, but on surprising grounds. The CA focused on the word ‘trial’; in its view, an initial possession hearing at which the defendant does not appear, and at which the court simply hears brief evidence before making an order, is not a ‘trial’. Rather, it is a rapid ‘summary procedure’ more akin to a disposal or summary judgment hearing than to a trial (‘which takes place at the end of the case management process and is the occasion on which the disputes of fact and law are adjudicated on... in the light of the evidence’). It would only be an exceptional case where there was a trial of a possession claim at the first hearing. Accordingly, r39.3(5) did not apply. Instead, the court would use its general case management powers under r3.1(2)(m), which allows the court ‘to take any other step or make any other order for the purpose of managing the case and furthering the overriding objective’. Using that approach, a failure to act ‘promptly’ was not a fatal bar, but is merely one of the factors to be taken into account. Accordingly, the CA felt able to set aside the possession order.

While this case was concerned with a possession order, the likelihood is that the same reasoning would apply equally to applications to set aside other types of orders or judgments made at hearings, rather than trials, at which a party is absent, and where set-aside criteria are not set out by the rules. This would include, for instance, consumer credit hearings under PD 7B; hearings under r23.11; disposal hearings under 26 PD 12; and summary judgment hearings under r24. Clearly then this is a case of some significance. See excellent commentary in [2009] NLJ 1580. Forcelux Ltd v Binnie [2009] EWCA Civ 854.