Default judgment entered against you? You may be able to have it set aside
A default judgment is entered when a defendant does not respond to a claim in time. It can feel final, but Victorian courts can set it aside. Whether you succeed depends on one question first: was the judgment entered regularly or irregularly?
This guide explains how Victorian courts approach applications to set aside default judgment, what you must prove, and what to do straight away. It is general information only.
The legal framework
In the Supreme Court of Victoria, the power to set aside a default judgment comes from rule 21.07 of the Supreme Court (General Civil Procedure) Rules 2025 (Vic). Other Victorian courts, including the Magistrates' Court and the County Court, have their own rules, and the approach in each is similar in principle. If you are dealing with a judgment in a court other than the Supreme Court, check the rules of that court.
Regular or irregular: why the difference matters
Victorian courts draw a basic line between two kinds of default judgment.
Irregular default judgments: set aside as of right
A default judgment is irregular when it was not entered in accordance with the rules of court, or there is some other procedural defect. Examples include:
judgment entered before the time for filing an appearance or defence had expired;
the originating process was not properly served;
a material error in the originating process; or
the judgment recites the wrong type of default.
If the judgment is irregular, the defendant is entitled to have it set aside as of right (the Latin phrase is ex debito justitiae). See Daly v Silley [1960] VR 353. The courts say an irregular judgment should not remain on the court's records (Macquarie Bank Ltd v Beaconsfield [1992] 2 VR 461).
Importantly, you do not have to show a defence on the merits, explain why you did not respond, or show you acted promptly. The court keeps a residual discretion to disregard an irregularity where justice requires, but it uses that discretion sparingly (see Yacoub v Delorenzo [2026] VSC 409).
Regular default judgments: a discretion, guided by four factors
If the judgment was entered regularly, the court decides whether it is appropriate in all the circumstances to set it aside and let the claim be decided on the merits. The test comes from Kostokanellis v Allen [1974] VR 596 and has been affirmed by the Court of Appeal in cases including Lubura v Nezirevic (2013) 42 VR 43 and Lei v Zhang [2020] VSCA 123.
The four Kostokanellis factors
The court looks at:
A prima facie defence on the merits. Do you have an arguable defence?
The reasons for the default. Why did you not respond in time?
Promptness. Did you apply quickly after you found out about the judgment?
Prejudice to the plaintiff. Would the plaintiff suffer prejudice that cannot be adequately compensated by an order for costs?
No single factor is necessary or sufficient. But the Victorian courts treat the first one as the primary consideration: whether you can show an arguable defence on the merits.
1. An arguable defence
If you can show a real defence, the court will not ordinarily want to let a judgment stand when there has been no proper adjudication of the dispute (Lubura v Nezirevic).
To show a defence you should file an affidavit that sets out the defence you intend to rely on. It must explain both the facts and the legal basis for the defence clearly enough that the court is satisfied it is not speculative or lacking in substance.
You do not have to prove that the defence will succeed. The standard is that the defence has real prospects, and the court does not decide disputed facts or the final merits at this stage (see Barker v Commonwealth Bank of Australia [2016] VSC 268).
2. The reasons for the default
The explanation matters, but it is secondary to whether you have a defence. An explanation that shows you missed the deadline through mistake, because you were misled, or because of a solicitor's error can help the court exercise its discretion in your favour.
A weak explanation does not automatically defeat your application if you have an arguable defence. The courts are reluctant to prevent a defendant from defending a claim, especially where the plaintiff suffers no prejudice that costs cannot cure (J.R.C Enterprises Pty Ltd v Zoomlion Australia-New Zealand Pty Ltd [2013] VSC 646).
3. Delay
You should apply as soon as you learn of the judgment. Delay is assessed in context. A delay that might ordinarily look unreasonable may be excused where you have a strong defence and the plaintiff would suffer no irreparable prejudice (Morris v Whitehorse City Council [2023] VSC 336).
4. Prejudice to the plaintiff
The question is whether any prejudice to the plaintiff from setting aside the judgment can be adequately compensated by a suitable costs order, and by security for those costs. The court may impose conditions such as paying the plaintiff's costs or providing security.
What to do if a default judgment has been entered against you
Act immediately. Delay counts against you, so get advice as soon as you learn of the judgment.
Check how the judgment was entered. Look at the dates, how and when you were served, and whether the claim documents were correct. An irregularity can change your whole position.
Gather your evidence. Collect the documents that support your defence and anything that explains why you did not respond.
Prepare an affidavit. It should set out the facts and legal basis of your defence, and your reasons for the default.
Be ready to offer conditions. Offering to pay costs or provide security can help answer a claim of prejudice.
Get legal advice. A lawyer can advise which court's rules apply and the best way to frame the application.
Frequently asked questions
Can a default judgment be set aside in Victoria? Yes. A court can set aside a default judgment. An irregular judgment will usually be set aside as of right, and a regular judgment can be set aside in the court's discretion.
What is an irregular default judgment? One that was not entered in accordance with the court rules, for example because it was entered too early or the originating process was not properly served.
Do I need a defence to have a default judgment set aside? For a regular judgment, an arguable defence is the primary consideration. For an irregular judgment you do not need to show one.
What if I have a poor excuse for missing the deadline? It does not necessarily defeat your application if you have an arguable defence and the plaintiff would not suffer prejudice that costs cannot fix.
How quickly do I have to apply? As soon as possible after you learn of the judgment. Delay is weighed against all the circumstances, including the strength of your defence.
Talk to O'Haire Legal
O'Haire Legal acts for defendants and plaintiffs in debt and civil matters in Victoria. If a default judgment has been entered against you, contact us for advice as soon as possible.
O'Haire Legal 5/21 View Point, Bendigo VIC 3550 (03) 7064 0341 home@ohairelegal.com.au
This article is general information only and is not legal advice. The law changes and every case turns on its own facts. Speak to a lawyer about your situation.
