Bektas v M and D Investments (ACT) Pty Ltd

Bektas brought a claim against M and D Investments (ACT) Pty Ltd, seeking compensation for breaches of contract. The defendant failed to respond to the claim, leading to a default judgment being entered in favour of Bektas. M and D Investments then applied to set aside the default judgment, and the parties agreed to the setting aside by consent. The central issue before the court was whether the 'general rule' that the party seeking to set aside a default judgment should bear the costs of the other party should apply. Additionally, the court had to determine whether the default judgment was irregularly obtained, given that the application for default judgment was made without warning and contained a technical error in describing the claim as a liquidated demand.

The court held that the general rule regarding costs when setting aside a default judgment could be departed from in appropriate circumstances. In this case, the court found that the plaintiffs were not seeking indulgence and that the default judgment should never have been signed, given the irregularities. The error in describing the claim as a liquidated demand did not, in itself, render the default judgment irregularly obtained, as the court clarified the meaning of a liquidated demand and found that the error was not material. The court determined that the plaintiffs were responsible for the costs of the application to set aside the default judgment, as the irregularities in the application process warranted this outcome.

In light of the findings, the court ordered that the plaintiffs pay the defendant's costs of the application to set aside the default judgment. The exact amount of costs and further details regarding the execution of the judgment were to be determined in subsequent proceedings. The court's decision highlighted the importance of ensuring that applications for default judgment are made correctly and with proper warning, and that any irregularities in the process could lead to the setting aside of the default judgment and a departure from the general rule on costs.