The Court of Appeal has dismissed Leslie Stuart’s appeal against a refusal to set aside a €98,252 default judgment obtained by Fabri-Clad Engineering Ltd. The court also allowed one alternative ground of the company’s cross-appeal, finding that the High Court had wrongly treated the consideration for Stuart’s guarantee as past consideration.
The judgment, delivered by Ms Justice Máire Whelan on 27 August 2020, concerned a guarantee Stuart signed on 22 January 2014 for debts owed by his son, Jeffrey Stuart, who traded as Stuart Steel Fabrications. The guarantee referred to €98,252 owed to Long Roulston Ltd, the company’s former name. The company later changed its name to Fabri-Clad Engineering Ltd.
Fabri-Clad brought summary proceedings in March 2016. Stuart was served the following month but did not enter an appearance. Judgment in default was marked in May 2017. He applied in January 2018 to have it set aside, arguing, among other things, that he had not been properly served, the company was not a party to the guarantee, and he had a counterclaim for work he said he had carried out.
The High Court accepted that Stuart had a reasonable prospect of defending the claim on the ground that the guarantee might have been supported by past consideration. It nevertheless refused to set aside the judgment, citing the delay, a solicitor’s letter proposing payments towards the debt, and the absence of special circumstances explaining the failure to enter an appearance.
The Court of Appeal found that the counterclaim evidence did not establish a defence: the documents did not show that sums were due directly to Stuart, and the alleged work arose from circumstances independent of the guarantee. It also rejected the argument that the guarantee lacked consideration. The summary summons pleaded that the company required the guarantee in return for continuing to supply goods to Stuart’s son, and that supplies continued afterward. Stuart had not disputed those claims in his affidavits. The court said the consideration issue was raised too late at the High Court hearing.
The court concluded that Stuart had not shown a defence with a real prospect of success or special circumstances justifying relief from the regular default judgment. It dismissed his appeal. Although it rejected the company’s argument that the guarantee took effect as a deed under the Land and Conveyancing Law Reform Act 2009, it allowed the company’s alternative cross-appeal ground on consideration. The court directed that the company receive its costs of opposing the appeal and of the High Court motion; it made no order as to costs on the cross-appeal, subject to any application within 14 days.