Case No: A2/2012/0287
A2/2011/0670
A2/2011/0682
Neutral Citation Number: [2013] EWCA Civ 592
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT
Mr Justice Haddon-Cave
HQ10X03497
Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 10/06/2013
Before:

LORD JUSTICE RIX
LORD JUSTICE RYDER
and
SIR JOHN CHADWICK
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Between:

	SOPHIE DE FERRANTI
VALENS GOLDBERG LIMITED	Appellants	
	- and -		
	EXECUZEN LIMITED	Respondent	

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(Transcript of the Handed Down Judgment of
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Mr Jonathan Adkin (instructed by Peters & Peters Solicitors LLP) for the Respondent
The Appellants did not appear and were not represented
Hearing date: 8 March 2013
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Judgment
Sir John Chadwick: 
1.	Execuzen Limited, the claimant in these proceedings, carries on business as a recruitment consultant in the investment banking and wealth management sector. It is common ground that, for a period between October 2009 and May 2010, the first named defendant, Sophie de Ferranti, was employed by the claimant under a contract of employment dated 24 August 2009 as “Managing Director, Head of Private Banking and Wealth Management”. The second named defendant, Valens Goldberg Limited is – or was at the material time – owned and controlled by Ms de Ferranti. She was its sole director. 
2.	These proceedings were commenced on 15 September 2010 by the issue of a claim form seeking damages against both Ms de Ferranti and Valens Goldberg, equitable compensation (alternatively an account of profits), declaratory relief and the delivery up of documents. Particulars of claim were attached to the claim form. Put shortly, the claimant alleges that, in March 2010, Ms de Ferranti used her position as an employee to divert a business opportunity from Execuzen to her own company, Valens Goldberg.
3.	On 14 December 2010 the claimant obtained an order from Mr Justice Ramsey for judgment in default of acknowledgment of service. That judge, following a hearing of which the defendants were not given notice and at which they did not appear, gave directions for a trial of quantum at which damages were to be assessed. That trial of quantum was heard by His Honour Judge David Mitchell, sitting as a Judge of the High Court, on 23 February 2011. Again the defendants did not appear; although they did have notice of that hearing. Judge Mitchell assessed damages in an amount exceeding £700,000.
4.	The defendants sought orders setting aside the judgment in default and staying the payment of the damages which had been assessed under that order. That application came before Mr Justice Haddon-Cave on 19 January 2012. He dismissed the application. The defendants appeal from that Order with permission granted by this Court (Lord Justice Toulson) on 14 November 2012. 
5.	When the appeal came on for hearing before this Court, on 8 March 2013, the defendants did not appear. Ms de Ferranti had indicated, in an e-mail sent to the listing office on the previous day, that she would be unable to attend “for medical reasons”; and that she sought an adjournment. Accordingly, the first matter for consideration was whether the Court should proceed with the appeal in her absence. For the reasons which will appear later in this judgment, the Court decided that it should do so.  In order to set that decision in context – and to explain why, having addressed the issues raised by the appeal, the court has decided that the appeal should be dismissed – it is necessary, first, to describe the claims made in the proceedings and then to refer to the procedural history in some detail.    
The claims in these proceedings
6.	As I have said, the claimant alleges that Ms de Ferranti used her position as an employee to divert a business opportunity from Execuzen to her own company, Valens Goldberg. It seeks damages against Ms de Ferranti for breach of her contract of employment, breach of fiduciary duty and breach of confidence, damages against Valens Goldberg for dishonest assistance and knowing receipt, equitable compensation (alternatively, an account of profits), declaratory relief and the delivery up of documents.  
7.	The claimant relies, in particular, on an e-mail sent by Ms de Ferranti on 16 March 2010 to Kirsty How, Head of Wealth Management UK at UBS AG (an existing client of Execuzen) in these terms:
“Thank you for your email.
Unfortunately I would be unable to include the broader search under our current engagement terms as it would mean re-focussing my team who are also involved in another boutique retained mandate which is producing significant revenue.
What I am able to do however is to exclusively engage my own consulting limited company, Valens Goldberg Limited, to conduct a specific research map and candidate shortlist to produce 10 candidates to fulfil your 3 week timeframe. This would include up to 5 target banks to be identified by you as the client.
I am very happy to discuss a fee on this and would front the assignment myself as MD. I would also be able to structure a very competitive upfront fee terms and drop the final engagement fee hire to 20% flat fee of first year base compensation.
Given the urgency, and to initiate the assignment by end of this week (19th), I would be happy to negotiate an upfront fee in the region of £30k for 5 banks, and given that we have already produced a benchmark presentation on the level and depth of detail that we can achieve.
I do believe this will bring to light the talent that UBS is seeking and also provide you with significant intelligence as to compensation and AuM.
Do let’s please discuss as soon as possible and I can earmark resources to focus wholeheartedly on UBS.”

That e-mail was sent by Ms de Ferranti as “Managing Director, Head of Private Wealth Management, Execuzen Limited”. It is alleged by the claimant that, by an e-mail reply of the same date, UBS engaged Ms de Ferranti and/or Valens Goldberg on terms subsequently negotiated between the parties; and that, accordingly, UBS did not engage Execuzen to carry out the project to which Ms de Ferranti’s e-mail had referred. 
8.	It is further alleged in the particulars of claim that, on 6 May 2010, Ms de Ferranti sent from her e-mail account at Execuzen to the e-mail address which she used as managing director of Valens Goldberg a number of e-mails containing confidential information including client names, client contact details, curricula vitae of executives who were considering career changes, client enquiries and requests and details of meetings and appointments. It is said that it is to be inferred that Ms de Ferranti used the information in those e-mails to contact Execuzen’s clients or executives who were considering career changes, to respond to client enquiries and requests, but on her own behalf (or on behalf of Valens Goldberg) rather than on behalf of Execuzen, and to meet clients and/or executives, but (again) on her own behalf or on behalf of Valens Goldberg. 
9.	It is alleged, also, in the particulars of claim that, in breach of restrictive covenants in her contract of employment, Ms de Ferranti, after leaving her employment with Execuzen, solicited or endeavoured to entice away from Execuzen its business with UBS, provided recruitment consultancy services to UBS in competition with Execuzen and offered employment with Valens Goldberg to a named employee of Execuzen.
The procedural history
10.	On 23 September 2009 the claimant filed certificates of service of the claim form, particulars of claim and response pack on both Ms de Ferranti and Valens Goldberg. It appears from those certificates of service that the documents were served by first class post addressed to 73 Orbis Wharf, Bridges Court Road, Battersea, London SW11 3GW; that being (it was said) the usual residence of Ms de Ferranti and the place of business of Valens Goldberg.
11.	The defendants did not file an acknowledgement of service of the claim within the time limited by CPR 10.3 or at all. By an application notice dated 19 October 2010 the claimant gave notice of its intention to apply for an order that there be judgment in default on the claim for damages, delivery up of documents, interest and costs. 
12.	The copy of the application notice which has been included in the bundle prepared for use at the hearing before this Court is endorsed, in manuscript, “Refer to Judge: 26: x:10”. It appears to have been put before Mr Justice Cranston on 29 October 2010. On that date he made an order that the application be listed before a High Court Judge on the first open date. His order includes a note of his reasons: 
“The claimant seeks default judgment. All I have before me is an application notice. CPR 12.4(2) provides that a claimant seeking a remedy other than money or delivery of goods must proceed under CPR 23. The claimant seeks an order for the delivery of documents containing confidential information. It must therefore proceed under CPR 23. Generally speaking that requires an application notice which, at the least, explains why the order is being sought. There is no explanation here except that the claim remains unsatisfied. Moreover, there must be a hearing unless the court considers that a hearing is unnecessary: CPR 23.8(c). Given that there is no explanation I do not consider that a hearing can be dispensed with.” 

A copy of that order was sent by the Queen’s Bench Listing Office to the claimant’s solicitors on 29 October 2010. Also sent with the order was the application notice itself, with a request that it be returned to the court with a further hearing fee, a time estimate and dates to avoid when listing. The copy of the application notice which is in our bundle suggests that it was received back by the Listing Office on 11 November 2010. It was then endorsed with a note that the matter would be listed for hearing on 14 December 2010.   
13.	The application came before Mr Justice Ramsey. Notice of the hearing was not given to Ms de Ferranti or to Valens Goldberg. They were not present or represented at the hearing. The application was supported by a witness statement made by Adrian Ezra, the managing director of Execuzen. The judge made an order substantially in the terms sought by the claimant.  In particular, he gave judgment on the claim against the defendants; he ordered that the defendants pay to the claimant damages and interest to be assessed by the court at a trial of quantum (“the Quantum Trial”); he gave procedural directions in relation to the Quantum Trial; he ordered that the defendants deliver up to the claimant all documents containing confidential information; and he directed that the defendants pay the claimant’s costs which he assessed on a summary basis. 
14.	The Quantum Trial came before His Honour Judge David Mitchell, sitting as a Judge of the Queen’s Bench Division, on 23 February 2011. The claimant had filed a further witness statement made by Mr Ezra (his second) in support of its claim. The defendants filed no evidence and did not appear. The judge explained the position at paragraphs 2 and 3 of the judgment which he delivered on that day: 
“2.	. . . Now, the position is that the case was listed to be called on either Wednesday, Thursday or Friday of this week (which in terms is 23, 24 or 25 February 2011) and on 21 February a letter was produced by the defendant, Ms de Ferranti, and it gives an address in Brussels. I am told by Mr Brown, counsel for the claimant, that this firm does, in fact, have an address in London. It is an address which has been used for communication and, indeed, service of proceedings and there are at least one or two people employed by the second defendant who apparently do work from that office or from those premises. What she says in her letter is this: 
‘I would like to confirm that I, the First Defendant, will be acting in person in this case for financial reasons. The Defendants respectfully request the Court’s consent to an adjournment of the forthcoming Quantum Trial listed for the week commencing 21 February 2011. As the First Defendant, I am currently residing in Belgium and it has only very recently come to light that a backdated bundle of documents in the above case have been served at the registered office of the Second Defendant’s registered company address – Orbis Wharf, Bridges Court Road, London SW11 3GW. There are only two employees of ValensGoldberg Ltd (sic), both of whom are not in the main residing full time in the United Kingdom. The First and Second Defendant have therefore not had the opportunity to serve an Acknowledgement of Service or indeed respond to the Claimant’s Particulars of Claim. Further, the Defendants wish to promptly submit an application to have the Judgment set aside. The listing date for the Quantum Trial has been set in a very short timeframe and the First Defendant is currently in Israel, due to return to the United Kingdom on Thursday 24 February.’ 
3.	I have indicated to Mr Brown in open court that, via the clerk to the listing, I received an email this morning which I am not able to print out but which was to similar effect to the letter. I seem to recall that the indication was that she was picking up her emails whilst away and, in fact, was coming back something like 10.30pm this evening, but that is entirely from my own memory.”  
15.	Accordingly, the judge considered whether he should grant the adjournment sought. He said this:
“5.	The major problem for these defendants is the fact that, shortly after 14 December, they must have known that judgment had been entered. I do not have the slightest doubt that, at the very least, whether they received the order in a timely fashion or not, the claimant’s solicitor would have been anxious to draw attention to the fact that they had in terms succeeded. They were also ordered to do various things, if necessary to produce a witness statement and, as a matter of law and fact, to pay the costs assessed by Ramsey J in the sum of £14,500 and also to the fact that he set the date as the first available date after 10 February. So it does not, in my judgment fall well for the defendant to be saying that the trial was set in a very short timeframe because she knew that, in fact, it was due to be listed as soon as reasonably practical after 10 February.
6.		The plain fact of the matter is that these defendants therefore have done absolutely nothing with regard to the progression of this claim. I do not think I have ever seen a claim go as far as this one and so little done by one party. It is quite plain that if they do 	require (and the ‘they’ refers to the company and the first defendant herself) to set aside the default judgment, then they must (and it is CPR13.3 that applies) show that they have a very real prospect of successfully defending the claim or they can persuade the court that there is some other agreement (sic). It says quite specifically at CPR13.3 (2):

  ‘In considering whether to set aside or vary a judgment entered under Part 12, the matters to which the court must have regard include whether the person seeking to set aside the judgment made an application to do so promptly.’
7.		It seems to me that although reference is made there to making an application to set aside judgment, on the face of it, it cannot be prompt, given that judgment was entered in excess of two months ago and so it seems to me that, so far as the judgment is concerned, the defendant has a mountain to climb.
8. 		But so far as the application to adjourn today is concerned, it seems to me that this is yet another chapter in a story of failure to engage with litigation. What litigants have to appreciate is that when a court adjourns a case, not only does it increase the cost but it has a knock on-effect on the court’s workload. I am available today to hear this case. Counsel has been instructed to attend. He is here. The solicitors are here, the clients are here and, if the case has to be adjourned then, in fact, the result is that a great deal of time and money are wasted, not only by those representing the claimants and the claimants themselves but also the court time, which is becoming increasingly more valuable and pressed as a result of the cuts that are coming to the Court Service. The time has to be utilised to the greatest effect.
9.		It seems to me that this litigant has simply not done anything to progress this litigation. She applies for an adjournment at the last moment. It puts the claimants and the court in great difficulty but she has actually taken no steps, I think, apart from writing to the court about it to further this litigation. I also have to have regard to the fact that this claim (and I have read the bundle in some detail) does actually allege dishonest activity on the part of the defendant and I have to look at whether there is genuine merit behind it. There is no doubt if she had engaged with the process and, for example, paid some of the costs to date or even made a timely application to set aside, then I would have had the gravest difficulty in perhaps not allowing an adjournment.
10.	But quite simply to write to the court really on the eve of the trial, I appreciate this was on the Monday and here we are on the Wednesday, with what appears to be an inconsistent account, both in the letter and on the email that I can recall; namely the return date was tomorrow in the letter and tonight in the email, but I may be wrong about that. It seems to me that the late application is really, in my judgment, groundless. This lady does not appear to have evinced any intention at all of engaging with the litigation process.
11. 	In those circumstances, it seems to me that it would be quite wrong to adjourn this case. Had she put in, for example, a witness statement indicating she would like to take certain issues with the witness statements of the gentleman who has sworn statements on behalf of the claimant, then so be it; but she has done absolutely nothing. Simply to allow an adjournment when there is little prospect, as I see it, of seeing anything being done, it seems to me that I have really no option but to continue hearing the case. It would, in my view, be an injustice not to do so.”    
16.	Having refused the adjournment sought by the defendants, the judge addressed the quantum claim on the basis of Mr Ezra’s second witness statement. For the reasons which he explained in his judgment, he concluded that the claimant was entitled to recover £684,200 in respect of lost business; to which he added the cost of replacing the named employee who (it was said) had transferred from Execuzen to Valens Goldberg and the cost of temporary cover for another employee who had expended management time in investigating the matter. He ordered that the defendants pay to the claimant the sum of £716,316.51 (being loss amounting to £703,897.07 with interest of £12,419.44). And he ordered payment of the claimant’s costs, which he assessed, summarily, at £11,000.
17.	On 16 March 2011 solicitors then acting for the defendants issued an application notice seeking orders that “(1) All monies ordered on 23.02.11 are stayed and (2) All directions made on 14.12.10 are stayed until the outcome of the appeal and/or N244 application to set aside the orders.” That application notice was not served on the claimant’s solicitors until 28 June 2011. It appears to have been accompanied by a document described as “Provisional grounds for setting aside under CPR 39.3”. Those provisional grounds were in these terms (so far as appears from the copy which has been included in the bundle provided for use by this Court): 
“(1)	The Learned Judges erred in law and misdirected themselves in fact due to the following:
(i)	       In having regard to the case of Ladd v Marshall [1954] 3 All ER 745, it is expedient and in the interests of justice, that the Court admit fresh evidence of the first Appellant/defendant’s psychiatric illness and set aside the judgments of Mr Justice David Mitchell (sic) made on 23rd February 2011 and the judgment of Mr Justice Vivian Ramsey made on 14th December 2010
(ii)	The Appellants reserve their position to expand or amended (sic) these grounds once the transcripts of both hearings of 14th December 2010 and 23rd February has been received and considered by Counsel.”
The application notice contains a statement that “a witness statement will follow in 14 days which will be supported with evidence of being out of the UK until 12 March 2011 and the steps taken to obtain a copy of the claim form dated 15 September 2010 and order of 14.12.10 never seen prior to 12 March 2011”. There has been included in the bundle provided for use by this Court an undated witness statement, which appears to have been signed by Ms de Ferranti. Attached to that witness statement – and included in the bundle – is a copy of a medical report, addressed to the solicitors and dated 10 October 2011. The author of the report states that he is Ms de Ferranti’s general practitioner.  Also attached to the witness statement is an email sent by “VG Ltd’s officially appointed accountant” to an addressee at Valens Goldberg’s email address which is dated 7 October 2011. On the face of those documents it appears that the undated witness statement was prepared and signed (at the earliest) in October 2011: that is to say, some seven months after the date of the application notice and some eight months after the date of the Quantum Trial before Judge David Mitchell.  That conclusion is consistent with a document described as “Draft Skeleton Argument of the Defendant”, which appears to have been signed by counsel and to have been prepared at about the same time as the witness statement. That document bears the date 10 October 2011.   
18.	In a section of the witness statement headed “Service of Documents” Ms de Ferranti stated:
“16.	Peters and Peters (the solicitors instructed by the claimant) claim to have sent all correspondence in duplicate by email to me at a googlemail address which is often not checked, and VG Ltd at a ValensGoldberg email address. Due to the necessary spam and webmail security filters put in place by VG Ltd, certain emails containing attachments would have been, by default, captured as junk mail and would therefore not have been accessed by myself on my blackberry. (Can we please refer to the legal procedures relating to service of documents via email – I seem to recall us discussing that there had been recent changes).
 17.	It is unreasonable therefore for the Claimant to seek to uphold the claim for failure to acknowledge service as I, and VG Ltd, never received the claim form in hard copy. Any emails sent with large attachment could not also have been accessed.
18. In relation to service of documents in person, the Claimant and/or his agent had attempted to hand deliver various documents to Orbis Wharf without success (my UK address). On several occasions the building concierge for Orbis Wharf, (at that time a Mr Daniel Foster) had informed the Claimant’s agent (presumably a junior employee) that I was overseas travelling.”
“In the section headed “Quantum Trial of 24 February 2011, she stated:
“22. Attached at Appendix 5 is a hand-delivered (and receipted) letter dated 21 February 2011 written by myself informing the Court that I had only just received the bundle of documents, that I was not legally represented and that I would not be in the United Kingdom to attend the Quantum hearing scheduled for a floating trial on 23, 24 or 25 February 2011. I also telephoned and emailed a Mr James Tipp, Listings Clerk, directly informing him that I would be seeking an adjournment to enable me to attend the hearing in London on my return from Israel on 24 February. Peters and Peters then informed the Court immediately that I had allegedly ‘fled the country’ which is wholly untrue and unfounded. Peters and Peters then pressed ahead in my absence and Mr Justice Ramsey (sic) therefore subsequently proceeded on 23 February 2011 and ordered that the full claim plus costs be paid. Despite having informed both the Claimant’s solicitors and the Court in a hand delivered letter, the decision was taken to proceed therefore not allowing me or VG Ltd a fair opportunity to put our defence forward.”
In a section headed “Circumstances surrounding Resignation”, Ms de Ferranti stated:
“26.The Claimant alleges that both I and VG Ltd have diverted business away by continuing to work for UBS Wealth Management (the private banking arm of UBS Investment Bank) despite the six-month non-compete clause. I refute this allegation as I have had no dealings with UBS Wealth Management whatsoever and have not benefitted from any revenues that could or would otherwise have been generated. Furthermore, if the Claimant had in fact suffered any financial loss as a service supplier this would have been due to the fact that the key HR representative at UBS Wealth Management resigned in or around June 2010 to join Credit Suisse (namely a Kirsty How) thereby breaking the relationship. It would not have been due to my or VG Ltd soliciting business away.”
The witness statement offers no explanation for - and does not refer to – the email of 16 March 2010 sent by Ms de Ferranti to Ms Kirsty How at UBS; upon which the claimant relies in support of its “loss of business” claim.  
19.	The “Draft skeleton argument” dated 10 October 2011 took the point (amongst others) that the claimant did not serve on either of the defendants the application notice dated 19 October 2010, by which the claimant gave notice of its intention to apply for an order that there be judgment in default on the claim for damages, delivery up of documents, interest and costs and which was before Mr Justice Ramsey on 14 December 2010. 
20.	On 22 December 2011, prompted, perhaps, by the knowledge that the point that the defendants had not been served with the application notice dated 19 October 2010 - as, plainly, they should have been - would or might be taken on an application to set aside Mr Justice Ramsey’s order, the claimant issued an application notice seeking an order, pursuant to CPR 3.10 and CPR 6.28, “retrospectively dispensing with service of the Claimant’s application for Default Judgment dated 19 October 2010 on the grounds that the Defendants have suffered no prejudice as a consequence of the non-service”.  That application was supported by the witness statement of Sarah Gabriel (described as a non-member Partner at Peters and Peters). She explained that, although the application of 19 October 2010 had not been served on the defendants, Mr Justice Ramsey’s Order of 14 December 2010 was served on them. She stated:
“13	On 17 December 2010 the Order of 14 December 2010 was served by hand on each of the Defendants at the London Address [73 Orbis Wharf, Bridges Court Road, Battersea, London SW11 3GW]. Copies of the letters and enclosures were also sent to the First Defendant’s email address [sdeferranti@googlemail.com] . . .
 14.	On 6 January 2011 letters were sent by first class post to each of the Defendants at the London Address and a copy was also sent to the First Defendant’s email address enclosing a listing notice requiring them to attend at Court on 1 February 2011 to fix a date for the quantum trial. . . . 
 15.	On 14 January 2011 letters were delivered by hand to each of the Defendants at the London Address and a copy was sent to the First Defendant’s email address enclosing the List of Documents for the Quantum Trial. . . . I am informed by Mr Lee Quickenden that he gave the letters to a lady who identified herself as Julia Reece, an employee of the Second Defendant, who confirmed that she would ensure safe receipt by the First Defendant who was abroad.
16.	On 28 January 2011 letters were delivered by hand to each of the Defendants at the London Address and a copy was sent to the First Defendant’s email address enclosing the Second Witness Statement of Adrian Ezra . . . 
17.	 On 18 February 2011, letters were sent by first class post to each of the Defendants at the London Address and a copy was sent to the First Defendant’s email address notifying them of the date of the quantum trial which was fixed to take place on either 23, 24 or 25 February 2011 . . . 
. . .
19	          On the evening of 21 February 2011, the First Defendant telephoned Ms Nash [Amy Nash, a colleague of Ms Gabriel] from a UK telephone number. During the course of the call, she confirmed that she had received the letter before action [sent to the London Address on 28 May 2010], that she had just returned to the UK and received a bundle of documents at the London address and that she understood that the a quantum trial was to take place that week. The First Defendant said that she had had no opportunity to submit an acknowledgement of service or a counterclaim and confirmed that she would be seeking an adjournment of the quantum trial and would be acting for herself.”
Ms Gabriel attached to her witness statement copies of the letters and other documents to which she referred.  
21.	The Order sought was made by Master Eyre on 22 December 2011, without notice to the defendants, but with liberty to apply to set it aside within two days after service. On 6 January 2012 solicitors then acting for the defendants issued an application notice seeking an order that the Order of 22 December 2011 be set aside.
22.	Both the application made by notice dated 16 March 2011 – that is to say, the application to set aside the default judgment of 14 December 2010 and the directions for the Quantum Trial and to stay the order for payment made on 23 February 2011 (“the March 2011 application”) – and the application made by notice dated 6 January 2012 (“the January 2012 application”) came on for hearing before Mr Justice Haddon-Cave on 8 and 19 January 2012. There was also before him a third application, made by notice issued on behalf of the defendants on 16 January 2012, for an order that the hearing be adjourned. 
23.	The judge refused to adjourn the hearing. He ordered that the March 2011 application and the January 2012 application be heard together; and that the hearing of those applications proceed on 19 January 2012. There is no appeal to this Court from that part of his Order: permission to appeal on that point having been refused by Lord Justice Toulson on 14 November 2012. 
24.	The judge dismissed the January 2012 application; but, in case it were necessary to do so, he made his own order granting the claimant’s application (made on 22 December 2011) for dispensation of the need for service of the application, dated 19 October 2010, for default judgment. He also dismissed the March 2011 application. 
25.	The defendants sought permission to appeal from the order made by Mr Justice Haddon-Cave. The applications were considered by Sir Scott Baker on the papers. He dismissed the applications for reasons set out in his order dated 20 June 2012. He observed that “The defendants have had more than ample opportunity to seek to set aside the judgment against them . . .”. The applications were renewed. They were listed for oral hearing before Lord Justice Toulson. At that hearing Ms de Ferranti did not appear and was not represented. The hearing was refixed for hearing on 14 November 2012. Again Ms de Ferranti did not appear. Lord Justice Toulson explained the position as he understood it: 
“2.	. . . The hearing was fixed to suit the convenience of leading counsel who was then due to appear on her [Ms de Ferranti’s] behalf. That was at the request of solicitors on the record. On the morning nobody turned up. The solicitors were contacted and said they were no longer on the record. No intimation had been given to the Court. . . .
3	The consequence was that the hearing had to be relisted. I understand that Ms de Ferranti was at some stage told about it orally, but no letter had been sent to her. Today she did not appear and on enquiry being made said that she was unaware of the hearing date.   
26.	Lord Justice Toulson decided to proceed in the absence of Ms de Ferranti. For the reasons set out in the judgment which he delivered on 14 November 2012 ([2012] EWCA Civ 1808) he granted permission to appeal from that part of Mr Justice Haddon-Cave’s order dismissing the March 2011 application: that is to say, from the judge’s refusal to set aside the default judgment and to stay enforcement of the award of damages assessed thereunder. He also granted permission to appeal from that part of the judge’s order dismissing the January 2012 application; while observing that the application for permission to appeal from that part of the order “adds nothing to the application for permission to appeal against the order refusing to set aside the [default] judgment.”
The judge’s reasons
27.	In his judgment of 19 January 2012 Mr Justice Haddon-Cave set out the procedural history of these proceedings: observing that it was “as remarkable as it was depressing”. He referred to the observation of Judge Mitchell to the effect that the application to adjourn the Quantum Trial was “yet another chapter in a story of failure to engage with litigation”. He observed that counsel who appeared before him on behalf of the defendants “very fairly says that his main instructions today have been in relation to seeking an application to adjourn”. He was not instructed in relation to what the judge described as “the real meat of the matter”.  He identified (at paragraph 24 of his judgment), as “the real question in this lengthy debate”, whether or not an order retrospectively dispensing with service of the original application for default judgment could or should be made now or could or should have been made in December 2011. He set out the terms of CPR 3.10 and 6.28; and observed (at paragraph 28) that:
“Looking at both those rules, they are . . . (1) very broad and (2) there is nothing in them to limit the scope of the power of the court to remedy defects under 3.10 or dispense with service under 6.28.”
He referred to the witness statement of Sarah Gabriel - expressing the view that the reasons and rationale set out in that witness statement were powerful and correct -  and concluded (at paragraphs 33 and 34):

“33.	. . . even if Master Eyre did not have the power to make the order he made, it seems to me that the order he made, on the basis of the evidence that he had before him that I have before me now, was absolutely correct. The court must take a practical view of this sort [of] litigation and be fair to both parties, including the claimant, and it seems to me very clear that the claimant has been given the run around here and the defendants have chosen not to engage in litigation unless and until it suited them. The defendants utterly failed to take the relevant steps that were open to them, and allowed the matter to languish for a very long period of time indeed. There is not even . . . a draft defence some two-plus years after the Particulars of Claim were served on 15 September 2010.
34.	For all these reasons, it seems to me that, applying the overriding principle of proportionality and fairness to both sides, it is plain that the court today should decide these matters and my decision is: (1) The application to remit to Master Eyre is refused. (2) The court today refuses to set aside or vary the order of Master Eyre dated 22 December 2011. (3) If and so far as necessary, the court grants afresh an order in the same terms as made by Master Eyre, that service of the claimant’s application for default judgment in these proceedings be retrospectively dispensed with on the basis of the evidence and the witness statement of Sarah Gabriel (i.e. granting the application made in the claimant’s application notice dated 22 December 2011, under CPR 3.10 and CPR 6.28). (3) (sic) The defendants’ application dated 16 March 2011, which is returnable today, is dismissed. There is no merit in it whatsoever in circumstances where the defendants have delayed for so long to seek to set aside the judgment (and, having engaged at least in knowledge of the quantum hearing they may have waived their rights in any event).” 
The defendants’ application to adjourn the hearing of this appeal
28.	As I have said, when this appeal came before the Court for hearing on 8 March 2013, the defendants did not appear. In those circumstances, the first matter for the Court’s consideration was whether to adjourn the hearing so as to give them a further opportunity to do so; or to proceed in their absence. 
29.	There is no doubt that the defendants were aware that the appeal was listed for hearing on 8 March 2013. Ms de Ferranti was so informed by an e-mail sent to her by the Listing Office on 30 January 2013. On 6 March 2013 she responded to that e-mail in the following terms:
“There is a hearing listed for Friday 8 March in the above matter.
I have sent the papers to John Benson QC (who prepared the Skeleton Argument) and am awaiting his availability for Friday’s Hearing.
I will contact the court latest tomorrow to confirm availability.”
The Listing Office responded on the same day, confirming that the Court would be hearing the appeal on Friday 8 March 2013; and pointing out that that date had been agreed by the parties in January. 
30.	On 7 March 2013, the day before the hearing, Ms de Ferranti sent a further e-mail to the Listing Office. She wrote:
“I write in reference to tomorrow’s hearing which I am unable to attend for medical reasons. I will be sending to the Court within the next 24 hours confirmation to this effect from my medical practitioner. In the meantime, I also attach a recent letter from my GP, Dr Edward Barnes, under whose supervision I have been throughout the duration of this highly stressful case. As a result of this case, the high dose of medication I am currently prescribed and the associated mental and physical stress of this case (almost 3 years now), I have been advised that I am not well enough to attend the hearing tomorrow, listed for Friday 8 March.”
She went on to complain that she had still to receive, from the claimant’s solicitors, a copy of the claimant’s bundle; and that: “Consequently, I have not been able to provide the bundle to John Benson QC whom I intend instructing in this matter.” She asked that the Court “afford her the opportunity to (i) obtain the Appeal Bundle; (ii) instruct John Benson QC; and (iii) arrange private funding via my family”. She provided the court with a copy “of the draft Defence I submitted back in 2011”; and requested that that document and medical documents be put before the Court “with a view to seeking an adjournment to tomorrow’s hearing”.  
31.	Notwithstanding the statement, in her e-mail of 7 March 2013, that she would be sending to the Court “within the next 24 hours” confirmation from her medical practitioner that she was unable to attend the hearing for medical reasons, Ms de Ferranti did not provide the Court with any current medical report. The document said to be “a recent letter from my GP, Dr Edward Barnes” was the letter dated 10 October 2011 which had been attached to the undated witness statement on which she had relied in connection with her March 2011 application. That letter described a history of anxiety and nervous disorder, which had led to treatment in the form of medication under the supervision of a consultant. Dr Barnes described her as a vulnerable person who had struggled with difficult mental health problems and “generally managed them very well”. But he went on to observe that “the last two and a half years have been difficult for her and there have obviously been times when her symptoms have been very severe and completely debilitating, making functioning at a normal level very hard indeed”.  The letter of 10 October 2011 provides no basis upon which the Court can reach the conclusion that Ms de Ferranti was unable to attend the hearing on 8 March 2013 “for medical reasons”.
32.	In those circumstances the Court took the view, at the hearing on 8 March 2013, that there was no material upon which, in the face of opposition from the claimant, it could reach the conclusion that it would be appropriate to adjourn the appeal which was properly before it. After considering the history of repeated failure by the defendants to attend hearings of which they had had notice, the Court was satisfied that an adjournment would serve no useful purpose. In particular, there was no reason to think that, if an adjournment were granted, the defendants would attend, or be represented at, an adjourned hearing. The Court was unable to avoid the conclusion, reached by Judge Mitchell and Mr Justice Hadddon-Cave in the circumstances which I have described, that Ms de Ferranti was unwilling to engage with the litigation process. In fairness to the claimant, the only appropriate course was to proceed to determine the appeal in the absence of the defendants.
Determination of the appeals 
33.	As Lord Justice Toulson observed, when granting permission to appeal, the underlying question before the Court is whether Mr Justice Haddon-Cave erred in refusing to set aside the default judgment and to stay enforcement of the award of damages assessed thereunder. But before addressing that question it is, I think, first necessary to cut through the procedural thicket in which these proceedings have become entangled. 
Setting aside the default judgment
34.	Part 12 of the Civil Procedure Rules sets out the circumstances in which, and the procedure by which, a party may obtain a “default judgment”: that is to say, a judgment without a trial where a defendant (a) has failed to file an acknowledgment of service or (b) has failed to file a defence. Part 13 sets out the procedure for setting aside a default judgment. CPR 13.2 identifies the cases where the Court must set aside a judgment entered under Part 12: in particular, paragraph (a) of that rule requires that the court must set aside a judgment entered under Part 12 if the judgement was wrongly entered because: 
“(a) in the case of a judgment in acknowledgment in default of acknowledgment of service, any of the conditions in rule 12.3(1) and 12.3(3) was not satisfied; . . .”
The conditions in CPR 12.3(1) are that a claimant may obtain a judgment in default of acknowledgement of service only if (a) the defendant has not filed an acknowledgement of service . . .; and (b) the relevant time for doing so has expired.  Those conditions were satisfied in the present case. CPR 12(3) sets out circumstances in which a claimant may not obtain a default judgment. None of those circumstances exist in the present case. It follows that the case does not fall within CPR 13.2: it is not a case where the court was required, by that rule, to set aside the default judgment entered on 14 December 2010.  
35.	CPR 13.3(1) provides that:
“In any other case [that is to say, in any case not falling within rule 13.2], the court may set aside or vary a judgment obtained under Part 12 if 
(a)	the defendant has a real prospect of successfully defending the claim; or
(b)	it appears to the court that there is some other good reason why
(i)	the judgment should be set aside or varied; or
(ii)	the defendant should be allowed to defend the claim.
CPR 13.3(2) requires that, in considering whether to set aside or vary a judgment entered under Part 12, the matters to which the court must have regard include whether the person seeking to set aside the judgment made the application to do so promptly.
36.	CPR 12.4(1) provides that, subject to paragraph (2) of that rule, a claimant may obtain a default judgment by filing a request in the relevant practice form where the claim is for (a) a sum of money; (b) an amount of money to be determined by the court; (c) the delivery of goods where the claim form gives the defendant the alternative of paying their value; or (d) any combination of those remedies. CPR 12.4(2) requires (so far as material in the present context) that a claimant must make an application in accordance with Part 23 if he wishes to obtain a default judgment on a claim which consists of or includes a claim for any other remedy. As Mr Justice Cranston pointed out, on 29 October 2010, the claim in the present proceedings included a claim for the delivery up of documents containing confidential information: accordingly, CPR 12.4(2) required that the claimant proceed under CPR 23. The application before Mr Justice Ramsey on 19 December 2010 was an application under CPR 23.
37.	CPR 23.4(1) provides that, as a general rule, a copy of the application notice must be served on each respondent. Rule 23.10(1) provides that a person served with an order made on an application but on whom a copy of the application notice was not served may apply to the court for the order to be set aside or varied. Rule 23.10 (2) requires that an application under rule 23.10 “must be made within 7 days after the date on which the order was served on the person making the application”.  In the present case the order of Mr Justice Ramsey made on 14 December 2010, was served on the Defendants on 17 December 2010; see the affidavit of Ms Gabriel to which reference has been made earlier in this judgment. The March 2011 application was, of course, made long after the seven day period prescribed by Rule 23.10(2) had expired. 
38.	It follows, as it seems to me, that from 25 December 2010 (or thereabouts, on the expiry of seven days from service of Mr Justice Ramsey’s order of 14 December 2010) until 22 December 2011 (when Master Eyre made the order dispensing, retrospectively, with service of the application notice required under CPR 23.4(1)), the defendants were faced with the difficulty that Rule 23.10(2) precluded an application to set aside the order of 14 December 2010 – or, at the least precluded an application under CPR 23.10(1) - unless they could obtain an extension of time for that purpose. That was the position when, following Judge Mitchell’s order of 23 February 2011, the defendants issued the March 2011 application notice. It remained the position when that application was served on the claimant’s solicitors on 28 June 2011.
39.	The March application notice contains no request for an extension of time in which to make an application under CPR 23.10(1). As I have explained earlier in this judgment, the March application notice appears to have been accompanied by a document described as “Provisional grounds for setting aside under CPR 39.3”. CPR 39.3 provides that a court may proceed with a trial in the absence of a party. Rule 39.3(2) provides that where a party does not attend and the court gives judgment or makes an order against him, the party who failed to attend may apply for the judgment or order to be set aside. 
40.	Rule 39.3(5) is in these terms:   
“Where an application is made under paragraph (2) . . . by a party who failed to attend the trial, the court may grant the application only if the applicant— 
(a) acted promptly when he found out that the court had exercised its power to strike out(GL) or to enter judgment or make an order against him; 
(b) had a good reason for not attending the trial; and 
(c) has a reasonable prospect of success at the trial.”
It is difficult to see how the defendants could have hoped to persuade the court that they had acted promptly in seeking to set aside the judgment served upon them on 17 December 2010 by an application made in March 2011 (after the Quantum Trial). 
41.	But, until 22 December 2011 (the date of Master Eyre’s order), CPR 39.3(5) would have had no application in relation to an application to set aside Mr Justice Ramsey’s order of 14 December 2010. In Nelson and another v Clearsprings (Management) Ltd [2006] EWCA Civ 1252; [2007] 1 WLR 962, Sir Anthony Clarke, Master of the Rolls, delivering the judgment of the Court of Appeal, observed (at paragraph 35) that, so far the Court was aware there had been no case in which that rule had been held to apply where the defendant had not been served with proceedings in accordance with the CPR and was ignorant of them. It was, in the judgment of the Court, “exceedingly unlikely that the draftsman of the CPR intended such a result”. He went on, at paragraph 39, to say this:  
“We do not think that the draftsman of the CPR can have intended to introduce what the editors [of the White Book] call the more stringent requirements of rule 39.3(5) into applications to set aside judgments irregularly obtained, in the sense of being obtained without service of the claim form in accordance with the rules. In our judgment, the whole of rule 39.3 contemplates a trial in the absence of a party who has been served under the rules or in respect of whom service has been dispensed with.”

42.	The decision of this Court in Nelson v Clearsprings is clear authority for the proposition that CPR 39.3(5) would have had no application in the circumstances that, as matters stood until 22 December 2011, Mr Justice Ramsey’s order of 14 December 2010 had been made without the defendants having been served with the application notice required under CPR 23.4(1) and where no order had been made dispensing with such service. But, as it seems to me, that decision is not authority for the proposition that CPR 23.10(2) had no application in such circumstances.  
43.	In CPR 23.10, the draftsman has provided, in express terms, for what is to happen if a person is served with an order made on an application under CPR 23.4(1) in circumstances in which a copy of the application notice had not been served on him. In such a case the person served with the order may apply to the court for the order to be set aside or varied. But CPR 23.10 (2) requires, in terms, that an application under rule 23.10 “must be made within 7 days after the date on which the order was served on the person making the application”. In the context of CPR 23.10, it is, as it seems to me, impossible to hold – as the Court were able to do in the context of CPR 39.3(5) - that the draftsman did not intend the strict time requirement imposed by CPR 23.10(2) to apply in a case where the judgment was “irregular”, in the sense that it had been obtained at a hearing of which the person affected had not had notice. That was the situation to which the rule was specifically directed. One explanation for the difference may be that CPR 23.10(2) applies only where the person affected has been served with the order; and that the strict time requirement runs only from the date of such service: CPR 39.3(5) would apply – as the Court pointed out – in circumstances where the person affected by the order was not aware that it had been made until long after the event. 
44.	Whether or not that is a correct analysis of the position from 25 December 2010 until 22 December 2011, the position changed when Master Eyre made the order dispensing, retrospectively, with service of the application notice required under CPR 23.4(1). From that date, as it seems to me, the better view is that CPR 23.10 ceased to apply: because there was no requirement that the application notice be served. The position, then, I think, is that an application to set aside the default judgment was to be determined by reference to CPR 13.3.  
The January 2012 application
45.	It is convenient to consider, at this stage, whether Mr Justice Haddon-Cave erred in refusing to accede to the defendants’ application, made by application notice dated 6 January 2012, for an order setting aside Master Eyres’s order of 22 December 2011. Indeed, as I have said, not only did the judge refuse to set aside that order; he stated that, if and so far as necessary, he would make an order of his own dispensing, retrospectively, with the need for service under CPR 23.4(1). 
46.	In that context it is appropriate to consider whether the defendants’ position – as it was at the time of the hearing before Mr Justice Haddon-Cave on 19 January 2012 - would have been  improved if the order of 22 December 2011 had not been made; or, to put the point the other way, whether the defendants would have been in a stronger position to argue that the default judgment of 14 December 2010 should be set aside if they could  have asserted that, in breach of CPR 23.4(1) they had not been served with the application notice. 
47.	CPR 3.10 makes it plain that the judgment obtained on 14 December 2010 – although “irregular” – was not invalidated by the failure to serve the application notice. Nevertheless, before the introduction of the Civil Procedure Rules it could have been expected that a party against whom an order was made in his absence – in circumstances where he should have been (but was not) given notice of the hearing – would have obtained, as a matter of course, an order setting aside that order. In Nelson v Clearsprings, this Court considered whether that remained the position after the introduction of the CPR: in particular, it addressed the respondent’s contention that it was entitled to have the judgment set aside as of right; as a matter of law independently of the provisions of the CPR; or, in the alternative, that, if the court did have a discretion under the CPR, it was a discretion that could only be exercised in one way. 
48.	The Court acknowledged (at paragraph 19 of its judgment) that that would have been the position before the introduction of the Civil Procedure Rules: 
“It is we think clear that, if this case had occurred before the CPR, the court would have set aside the judgment. In Akram v Adam [2004] EWCA Civ 1601, [2005] 1 WLR 1762, Brooke LJ observed at [32] that under the pre-CPR practice there was a difference between an irregular judgment, which could be set aside as of right, and a regular judgment, where the defendant had to show that he had a defence on the merits before the court would be prepared to have the judgment set aside. This was the practical effect of the pre-CPR cases to which we have referred. The question in this appeal is whether the position is the same or different under the CPR.”
But, as the Court held, the position had been altered by the Civil Procedure Rules. At paragraph 43 it observed that: 

“It does not, however, follow that under the CPR the defendant is entitled to have the judgment set aside as of right, ex debito justitiae, or indeed that, if there is a discretion it can be exercised in only one way. It was pressed upon us that such an extreme approach is inconsistent with the overriding objective of dealing with cases justly and that, on an application to set aside a judgment, (albeit irregularly obtained) a claimant might be able to demonstrate that there would be no point in setting aside the judgment and requiring the claimant to issue and serve new proceedings."
The question was whether the CPR permitted such an approach. The Court held that it did.
49.	It is clear, from the reasoning of this Court in Nelson v Clearsprings, that an application to set aside a judgement or order made against a party in his absence, at a hearing of which he should have been (but was not) given notice, has to be determined in accordance with the provisions of the CPR; and not by reference to some inchoate right to have the order set aside ex debito justitiae; or in the exercise of a discretion which can only be exercised in one way. It is pertinent to have in mind, in this context, the distinction between CPR 13.2 and 13.3.  When the draftsman intended that the court should be obliged to set aside a default judgment, he said so in plain terms. The question, therefore, is whether – under the provisions of the CPR – the defendants would have been in a better position on 19 January 2012 if the order of 22 December 2011 were set aside. 
50.	In my view, the answer to that question is plainly “No”. If the order of 22 December 2011 had not been made - or if it were set aside – the defendants would be faced with the strict time limit imposed by CPR 23.10(2). The effect of the order of 22 December 2011 – whether intended or not – was that CPR 23.10 was no longer in point: the strict time limit was no longer a problem for the defendants to overcome.      
51.	For that reason alone, as it seems to me, we should dismiss the appeal from the judge’s refusal to set aside the order of 22 December 2011. To allow that appeal would be of no benefit to the defendants.
Did the judge err in refusing to set aside the default judgment
52.	For the reasons which I have set out, I am of the view that – on a correct analysis of the position as it had developed - the judge should have approached the application to set aside the default judgment with the provisions of CPR 13.3 in mind. That is to say, he should have asked himself (i) whether the defendants had a real prospect of successfully defending the claims against them; or, if not, (ii) whether there was some other good reason why the judgment should be set aside or varied; or the defendant should be allowed to defend the claim. If he reached the conclusion that one or other of those conditions were satisfied, then he should have asked himself whether, as a matter of discretion, this was a case in which to exercise the discretionary power conferred upon him by CPR 13.3(1); and, in addressing that question, he was required, by CPR 13.3(2), to consider whether the defendants had acted promptly in seeking to have the judgment set aside. 
53.	The judge did not adopt a structured approach of that nature. His reasons for dismissing the application to set aside the default judgment are succinctly expressed in a single sentence of his judgment:
“There is no merit in it whatsoever in circumstances where the defendants have delayed for so long to seek to set aside the judgment (and, having engaged at least in knowledge of the quantum hearing they may have waived their rights in any event).” 
He should have asked himself – at the least – whether the defendants had a real prospect of successfully defending the claims against them; and, if so, whether the defence was of such merit that the defendants should be allowed to pursue it notwithstanding the quite exceptional delays which had occurred in these proceedings. He did not do so: understandably, perhaps, in the circumstances that he had no formal defence before him on 19 January 2012. But, in failing to do so, he fell into error. 
54.	I will assume that the material before the judge included two documents to which reference has been made earlier in this judgment: (i) the undated witness statement, which appears to have been signed by Ms de Ferranti, and (ii) the document described as “Draft Skeleton Argument of the Defendant”, dated 10 October 2011, which appears to have been signed by counsel and to have been prepared at about the same time as the witness statement. The first of those documents contains no reference to, or explanation for, the e-mail of 16 March 2010 on which the claimant founds its claim in respect of solicitation of clients. The draft skeleton argument asserts only that “The case Exn puts forward as to diversion of business is wildly based on outrageous inferences to be derived from that email”. It contains no explanation as to why that email was sent; or why it should not be taken as an invitation to place with Valens Goldberg business which had been offered to the claimant. Nor does it make any reference to the e-mail of 6 May 2010, by which (as the claimant alleges) Ms de Ferranti sent from her e-mail account at Execuzen to the e-mail address which she used as managing director of Valens Goldberg a number of e-mails containing confidential information including client names, client contact details, curricula vitae of executives who were considering career changes, client enquiries and requests and details of meetings and appointments.  It seems to me impossible to avoid the conclusion that, had the judge addressed those documents in his judgment, he would have concluded that the defendants had advanced no credible defence to the claims made against them; or, at the least, no defence which, having regard to the delay which had taken place, should have led him - in applying the approach required by CPR13.3 - to set aside the default judgment of 14 December 2010.
Should this Court allow the appeal from the judge’s refusal to set aside the default judgment
55.	The papers before this Court include a document described as a defence, but undated and endorsed with no signed statement of truth. That document contains a number of passages which are in the same terms as passages in Ms de Ferranti’s undated witness statement; suggesting that it may have been prepared by the same draftsman and at the same time (that is to say, probably in October 2011). Be that as it may, the “defence” contains no reference to, or explanation for, the e-mail of 16 March 2010 or to the e-mail of 10 May 2010. In response to the allegations made in Mr Ezra’s second witness statement, it is asserted that:
“22. The Claimant alleges that both the First and Second Defendants have diverted business away by continuing to work for UBS Wealth Management (the private banking arm of UBS Investment Bank) despite the six month non-compete clause. The First and Second Defendants refute these allegations as have had no dealings with UBS Wealth Management whatsoever and have not benefitted from any revenues that could or would have been generated. 
. . . 	
29.	Following the First Defendant’s termination of employment the First and Second Defendant had no further dealings with UBS Wealth Management due to the ongoing reputational damage suffered by the Swiss bank during the financial crisis. The well publicised tax evasion claims and whistle blowing cases further affected UBS Wealth Management’s ability to hire new employees. UBS Wealth Management (as opposed to UBS’ Investment Bank) suffered a significant outflow of client assets which further reduced the private bank’s hiring budget on a global scale.”

It is striking that there is no denial that Ms de Ferranti did send the e-mail of 16 March 2010 to the Head of Wealth Management UK at UBS AG (an existing client of Execuzen); that she did send that e-mail in her capacity as “Managing Director, Head of Private Wealth Management, Execuzen Limited”; or that the e-mail was intended to divert business from the claimant to Valens Goldberg.  It is striking, also, that there is no denial that, on 6 May 2010, Ms de Ferranti sent from her e-mail account at Execuzen to Valens Goldberg a number of e-mails containing confidential information including client names, client contact details, curricula vitae of executives who were considering career changes, client enquiries and requests and details of meetings and appointments. 
56.	As I have said, CPR 13.3 requires a court, in addressing an application to set aside a default judgment which does not fall within CPR 13.2, to ask itself whether the defendants had a real prospect of successfully defending the claims against them. On the material which has been put before this Court, I am satisfied that the answer to that question is “No”.  I am satisfied, also, that there is no other good reason why the judgment should be set aside or varied or that the defendants should be allowed to defend the claim. If I had thought that the answer to any of those questions was in doubt, I would have reached the conclusion that, having regard to the extraordinary and unexplained delay in seeking to set aside the default judgment after the defendants knew of the order of 14 December 2010 (and, in particular , the failure to take any steps to do so until after the Quantum Trial in February 2011), this was not a case in which the Court should exercise the power to set aside a default judgment which is conferred by CPR 13.3(1) 
57.	Accordingly, notwithstanding that I would hold that the judge erred in his approach to the question whether or not the default judgment should be set aside, I would dismiss the appeal from his order refusing to do so.
 Staying enforcement of the award of damages
58.	On the basis that the default judgment of 14 December 2010 should not be set aside; there is no purpose in staying the award of damages made by Judge Mitchell on 23 February 2011 in order to await the outcome of a trial on liability. The real question is whether, given that the defendants are liable on the claims made against them, the award of damages should be set aside on the ground that it followed a trial on quantum which they did not attend. 
59.	I have explained, earlier in this judgment, that CPR 39.3 provides that a court may proceed with a trial in the absence of a party; and that CPR 39.3(2) provides that where a party does not attend and the court gives judgment or makes an order against him, the party who failed to attend may apply for the judgment or order to be set aside. I have also set out the terms of CPR 39.3(5). Nothing in the judgment of this Court in Nelson v Clearsprings suggests that that rule does not apply in a case (such as the present, in the context of the award of damages on 23 February 2011) where the party which has failed to attend had proper notice of the hearing. In such a case, an application under CPR 39.3(2) may be granted only if each of three conditions is satisfied: (a) the applicant acted promptly when he found out that the court had exercised its power to enter judgment or make an order against him; (b) the applicant had a good reason for not attending the trial; and (c) has a reasonable prospect of success at the trial. 
60.	As I have said,  on 16 March 2011 solicitors then acting for the defendants issued an application notice seeking orders that “(1) All monies ordered on 23.02.11 are stayed.” There was no application to set aside the order of 23 February 2011. The application notice was not served on the claimant’s solicitors until 28 June 2011. It contained the statement that “a witness statement will follow in 14 days which will be supported with evidence of being out of the UK until 12 March 2011 and the steps taken to obtain a copy of the claim form dated 15 September 2010 and order of 14.12.10 never seen prior to 12 March 2011”. The undated witness statement was served, with the draft skeleton argument, on 28 October 2011. There has been nothing from the defendants to explain why the March application notice was not served until 28 June 2011; and nothing to explain why the witness statement was not prepared or served until 28 October 2011 (notwithstanding the assurance in the application notice that it would “follow in 14 days”).
61.	In those circumstances Mr Justice Haddon-Cave was entitled to take the view on 19 January 2012 – as, plainly, he did – that the application had not been made promptly (in the sense that it was to be taken as made when served); and had not been pursued with diligence (in that there was no evidence to support the application for a further four months). The first pre-condition to the exercise of a discretion to set aside the award of damages had not been met.
62.	Nor, as it seems to me, had the second pre-condition to the exercise of a discretion under CPR 39.3 been satisfied. It is plain that the defendants were aware of the date fixed for the hearing of the Quantum Trial: they have provided no credible evidence why they did not attend at that trial or arrange for representation.  
63.	In those circumstances it was unnecessary for the judge to go on to consider whether the third of the three pre-conditions to the exercise of a discretion to set aside the award of damages had been met: that is to say, whether the defendants would have had a reasonable prospect of success at the Quantum Trial. Given that two out of the three pre-conditions set by CPR 39.3(5) were not met, it would not have been open to the judge to set aside the award of damages even if he had thought the defendants would have a reasonable prospect of success if there were a new trial on quantum.
Conclusion
64.	For those reasons I would dismiss these appeals. 
Lord Justice Ryder
65.	I agree.
Sir Bernard Rix
66.	I also agree.