IN THE HIGH COURT OF KIRIBATI
Civil Jurisdiction
(South Tarawa)

MISCELLANEOUS APPLICATION # 2025-03162
(Arising out of HCCiv. Case # 24 of 2023)

In the matter between:

KWONG BWEBWEREITI	 					Applicant

And

BURATAAKE BWEBWENRATU
MARETATI TULAFONO						Respondents 

Counsel:	Ms. Taotere Korimara for the Applicant
		Ms. Elsie Karakaua for the Respondents

DECISION ON APPLICATION TO SET ASIDE DEFAULT JUDGMENT
I. Introduction
1.	This is an application by Mr. Kwong Bwebwereiti to set aside a default judgment entered against him on 27 September 2023, pursuant to Order 29 rule 12 of the High Court (Civil Procedure) Rules 1964.  The judgment was granted in favour of the respondents, who alleged that Mr. Bwebwereiti was party to an oral contract for the sale of goods and that his personal bank account was used in the course of the business.
2.	The applicant denies any involvement in the contract, asserting that his bank account was used without his knowledge or consent.  He claims he became aware of the contract only in February 2025 and contends that his wife, Aribeta, was solely responsible for the business dealings.
II. Procedural Background
3.	The applicant is an instructor at the Marine Training Center and is married to Aribeta Obetaia.  Both were named as defendants in the original suit.
4.	The claim arises from an alleged oral contract between the respondents and them (Aribeta Obetaia and himself) for the provision of goods and services, with $13,000 deposited into the applicant’s personal bank account.
5.	On 29 June 2023, counsel Ms. Kiata Ariera filed a Memorandum of Appearance on their behalf.
6.	There was no defence filed on their behalf thereafter.  On 27 September 2023, default judgment was entered against them for $16,000, general damages to be assessed, interest, and costs.
7.	Following the issuance of a writ of FIFA and an oral examination application by the respondents, the applicant now seeks to challenge the judgment, asserting lack of service, non-involvement in the contract, and a substantial defence.
8.	The respondents filed an affidavit in opposition, reiterating proper service and emphasizing the delay and potential prejudice.
III. Legal Framework
6.	The law of setting aside a default judgment is well established both in the English and our common law.  I note that other regional jurisdictions have developed their own jurisprudence on the subject as well.
7.	In setting aside a default judgment, Order 29 rule 2 of the High Court (Civil Rules) Procedure (1964) provides:
“Any judgment by default, whether under this Order or under any other of these Rules, may, be set aside by the Court, upon such terms as to costs or otherwise as such Court may think fit, and where an action has been set down on motion for judgment under Rule 8 of this Order, such setting down may be dealt with by the Court in the same way as if judgment by default had been signed when the case was set down.”
8.	Indeed, this is a rather broad discretion to set aside a default judgment, but it must be exercised judicially.  The jurisprudence in Evans v Bartlam and Alpine Bulk Transport v Saudi Eagle establishes that the Court must consider:
•	Whether the applicant has a substantial ground of defence;
•	Whether the default was excusable;
•	Whether the respondent would suffer irreparable harm if the judgment is set aside.
9.	These principles have been adopted and applied in Kiribati jurisprudence, notably in Waysang Kum Kee v Abamakoro Trading Ltd, KPA v Obetaia, and most recently in Mwamwa Kotua v Tiarite Kwong t/a Taotin Trading, which clarified the distinction between regular and irregular judgments and the procedural consequences thereof.
10.	Where a judgment is irregularly obtained, for claims not properly classified as liquidated, the Court has no discretion and must set it aside.  This principle is rooted in Anlaby v Praetorius and reaffirmed in George Moundreas v Navimpex Centrala Navala.  In Anlaby, his Lordship, Fry L., J observed:
“There is a strong distinction between setting aside a judgment for irregularity in which case the Court has no discretion to refuse to set it aside, and setting it aside where the judgment though regular, has been obtained through some slip or error on the part of the defendant in which case the Court has a discretion to impose terms as a condition of granting the defendant relief.” (emphasis mine)
11.	In other jurisdictions, authorities have made it clear that where a default judgment is irregularly obtained, the defendant is entitled ex debito justitiae to have such judgment set aside.  
12.	Hence, where a default judgment was obtained irregularly, it is a must for the court to set aside such judgment.
13.	In contrast, where a judgment is regular, the court may exercise its discretion; whether to set aside the judgment.  It seems from the authorities referred to earlier that an application to set aside a judgment regularly obtained must always be supported by an affidavit relating to a ground (or proposed) of defence, justification of the delay and whether there would be irreparable harm.
14.	The threshold for the required defence in such cases varies across jurisdictions.  In Burns v Kondel, Denning MR articulated a notably permissive threshold for setting aside default judgment, stating that 
“The defendant must show a good defence on the merits. He needs only show a defence which discloses an arguable or triable issue.” 
15.	This formulation reflects the English courts’ emphasis on access to justice and the avoidance of judgment without adjudication, even where the defence may ultimately fail.
16.	Whilst the English threshold emphasized the need for an arguable defence or triable issue, by contrast, the Kiribati jurisprudence seemed to have not made a decision on the threshold.  The High Court seemed to follow the English threshold however the Court of Appeal standard is more stringent, as expressed in Waysang Kum Kee and reaffirmed in Mwamwa Kotua, which requires a “substantial ground of defence”, interpreted as a defence of sufficient substance to warrant judicial consideration. 
17.	These two distinct thresholds need reconciliation.  In my view, the purpose of the threshold is to balance the need for procedural fairness with the imperative of using court limited resources.  It avoids adjudication by default where a plausible defence exists, while filtering out speculative or unsubstantiated claims.
18.	Accordingly, the phrase “substantial ground of defence” as expressed by the Court of Appeal shall be interpreted as requiring a prima facie defence, not merely arguable, but one that:
•	challenges a material element of the claim,
•	is supported by coherent affidavit evidence,
•	would, if proven, defeat or significantly alter the outcome.   
19.	While this Court adopts the “substantial ground of defence” threshold as more appropriate to the procedural and judicial context of Kiribati, it acknowledges that the rationale for departing from the English “arguable issue” standard warrants further articulation.  The English approach, as reflected in Burns v Kondel and Evans v Bartlam, emphasizes early access to justice and the opportunity to ventilate disputes before trial.  These values, while not conclusive, remain relevant to the development of Kiribati’s procedural jurisprudence.  Without a fuller exploration of the comparative policy considerations, the doctrinal shift may appear abrupt.  A clearer justification, grounded in the realities of local litigation and the need for evidentiary coherence, would strengthen the legitimacy of this threshold and assist future courts in applying it consistently.  Perhaps, I will leave this to the Court of Appeal to issue a definitive ruling reconciling the “substantial ground” and “arguable issue” thresholds to strengthen this shift.
20.	But for the purposes of this application, I would apply the “substantial ground” threshold.
IV. Analysis
(i) Proposed Defence
21.	The applicant’s affidavit denies involvement in the contract and asserts that his bank account was used without his knowledge or consent.  A supporting letter from his wife confirms that she alone conducted the business and used the account for convenience.  These form the backbone of the applicant’s proposed defence.
22.	Although the affidavit was not corroborated, this is not the purpose of Order 29 rule 2.  The scrutiny of the evidentiary weight and credibility are all matters for the trial.  What matters at this juncture is whether there is a “substantial ground of defence”.  
23.	Having reviewed the affidavit, I am of the view that it did raise a clear “substantial ground of defence”; it raises a triable issue whether the applicant was a party to the contract or merely the passive owner of a bank account used without his knowledge.  The letter from Aribeta supports the fact that the applicant was never a party to the alleged oral contract.  The distinction between actual participation and mere association is material, which can only be resolved at trial.  The affidavit evidence at this stage is therefore coherent, plausible, and directly challenges the basis of the claim.  
24.	The Court finds that the applicant has demonstrated a “substantial ground of defence”.
(ii) Reasonable Explanation for Delay
25.	The applicant’s explanation for the delay, that he travels to outer islands and was not served, is not persuasive; it is not supported by the record.  The Memorandum of Appearance filed on 29 June 2023 confirms that the applicant was properly served and legally represented.  Whether he was personally served or not is immaterial, as they were legally represented.  No defence was filed after the memo of appearance filed, nor was any extension sought.  Without any justification, the delay of nearly two years is deemed procedurally unjustifiable.
26.	However, this unjustifiable delay cannot automatically bar relief.  As held in Evans v Bartlam, and applied in Obetaia, the Court retains discretion to set aside a regular default judgment where a prima facie defence exists, and no irreparable harm is shown.
(iii) Prejudice to Respondents
27.	The respondents assert prejudice in the form of litigation costs and delay.
28.	While such inconvenience is acknowledged, it does not rise to the level of substantive prejudice.  As clarified in Sundarjee Bros, prejudice must affect the fairness or viability of the proceedings, not merely prolong them.
29.	The respondents have not demonstrated that setting aside the judgment would result in irreparable harm, such as loss of evidence, compromised witness availability, or procedural disadvantage that cannot be remedied merely by costs.
30.	Accordingly, the Court finds that while the delay is inexcusable, it is not fatal to the application.  The applicant’s right to be heard, supported by a “substantial ground of defence”, outweighs the procedural inconvenience to the respondents.  Relief can be granted on terms, including a costs award, to mitigate delay-related effect.
V. Irregularity of Default Judgment
31.	The default judgment was entered on 27 September 2023.  It was titled as the Default of Defence in case of Liquidated Demand, and it was entered under Order 27 rule 6.  The order states:
“The Defendant not having filed and serve a Defence to the Plaintiff, it is this day adjudged the Plaintiff recovers against the said Defendant:
1.	The sum of $16,000.00, 
2.	General damages to be assessed, 
3.	Interest and 
4.	Costs.”
32.	Reviewing the High Court (Civil Procedure) Rules, the default judgment was erroneously entered under Order 27 rule 6, which governs demurrer proceedings and contains no provision for default judgment.  The correct procedural basis for such entry lies under Order 29, specifically rules 2, 4, 6, or 8 as the case may be.  This is a procedural misstep that, in my view, renders the default judgment void ab initio.
33.	Even, if the error can be treated as a clerical one, the default judgment awarded the sum of $16,000.00, general damages to be assessed, interest, and costs.  Order 29 rule 2 clearly states that the plaintiff can only enter final judgment for the amount claimed and costs.  The inclusion of other elements, namely the general damages and interest, in the default judgment exceeds the scope of a liquidated demand; they require judicial assessment and are therefore unliquidated.
34.	As established in Mwamwa Kotua, general damages are not liquidated and cannot be summarily awarded without evidentiary hearing.  The inclusion of such elements renders the judgment irregular.
35.	Accordingly, the default judgment is void ab initio due to procedural misapplication and substantive overreach.  The Court is bound to set aside the judgment in its entirety pursuant to Anlaby v Praetorius and George Moundreas v Navimpex Centrala Navala, which affirm that irregular judgments must be vacated ex debito justitiae.
36.	The respondent’s praecipe for writ of fieri facias notably excluded the general damages, implicitly acknowledging the irregularity.  However, there has been no corrective application filed to date, which is required in this kind of situation.
37.	Accordingly, I find the default judgment improperly entered and must be set aside in its entirety.
V. Conclusion
38.	The Court finds:
(a)	The applicant has a substantial ground of defence.
(b)	The delay is inexcusable but does not override the irregularity of the default judgment.
(c)	The said judgment was improperly entered for an unliquidated demand.
(d)	The Court is bound to set aside the said judgment in its entirety due to procedural irregularity.
VI. Order
(1)	The default judgment entered on 27 September 2023 against Mr. Kwong Bwebwereiti is hereby set aside in its entirety.
(2)	The matter is to proceed to trial on the merits.
(3)	The applicant shall file and serve a formal defence within 21 days of this order.
(4)	Given the procedural delay and inconvenience caused to the respondents, irrespective of the irregularity, the applicant shall pay costs in the sum of $1500.00, calculated as follows:
•	$500 for legal representation during the oral examination and FIFA proceedings;
•	$700 for preparation and opposition to the present application;
•	$300 as a discretionary penalty to reflect the inexcusable delay and promote procedural diligence.
Costs awarded are to be paid within three months of this order.  To avoid confusion, the award is compensatory and not punitive.

Delivered at Betio, Kiribati
This 25th day of September 2025

…………………………………
HON. AOMORO T. AMTEN
Judge of the High Court