REPLIES AND DEFENCE TO COUNTERCLAIM: A PRIMER

July 19, 2016 · by · in Civil Procedure, Statements of Case, Uncategorized

Two recent posts* have highlighted the difficulties that can exist with the filing of Replies and Defence to Counterclaim. Here is a short Primer.

A REPLY

If the Defence does not contain a counterclaim a Reply is not mandatory.  There is no guidance in the rules relating to when and whether to file a Reply.

THE RULES RELATING TO A REPLY

CPR 15.8.

“Reply to defence
15.8  If a claimant files a reply to the defence, the claimant must
(a) file the reply with a directions questionnaire; and
(b) serve the reply on the other parties at the same time as it is filed.
(Rule 26.3(1) and (6) requires the parties to file directions questionnaires and specifies the period for doing so).
(Part 22 requires a reply to be verified by a statement of truth)”

CPR .16.7

Reply to defence

16.7
(1) A claimant who does not file a reply to the defence shall not be taken to admit the matters raised in the defence.
(2) A claimant who –
(a) files a reply to a defence; but
(b) fails to deal with a matter raised in the defence, shall be taken to require that matter to be proved.
(Part 22 requires a reply to be verified by a statement of truth)

A DEFENCE TO COUNTERCLAIM

If the Defence contains a counterclaim, however, then a Defence to the Counterclaim is mandatory. A failure to file a Defence to the counterclaim gives the Defendant a right to apply for judgment in default. As we have seen recently there is no guarantee that a court will exercise its discretion to set the default judgment aside.

THE RULES RELATING TO DEFENCE TO COUNTERCLAIM

The rules here are more complex.

Defendant’s counterclaim against the claimant

CPR 20.4

“20.4
(1) A defendant may make a counterclaim against a claimant by filing particulars of the counterclaim.
(2) A defendant may make a counterclaim against a claimant –
(a) without the court’s permission if he files it with his defence; or
(b) at any other time with the court’s permission.
(Part 15 makes provision for a defence to a claim and applies to a defence to a counterclaim by virtue of rule 20.3).
(3) Part 10 (acknowledgment of service) does not apply to a claimant who wishes to defend a counterclaim.

THE OBLIGATION TO FILE A DEFENCE TO THE COUNTERCLAIM

CPR 20.3 states

“20.3
(1) An additional claim shall be treated as if it were a claim for the purposes of these Rules, except as provided by this Part.”

Significantly 20.3(3) states

“(3) Part 12 (default judgment) applies to a counterclaim but not to other additional claims.”

So Part 12 (default judgment) applies to counterclaims.

TIME FOR SERVICE OF THE DEFENCE TO COUNTERCLAIM

A party filing a Defence to a Counterclaim is under more pressure than the original defendant.  There is no acknowledgment of service stage.  The Defence to Counterclaim must be served within 14 days of service of the Counterclaim (20.3.3).

Further it is clear from the judgment of Master Matthews in Muhammad -v- ARY Properties Limited[2016] EWHC 1698 (Ch) that a Defence to Counterclaim is not a formality and a full and detailed Defence to the points made in the Counterclaim is required.

OTHER POINTS ABOUT THE  REPLY AND DEFENCE TO COUNTERCLAIM

Practice Direction 15 contains important provisions about the nature of a Reply and Defence to Counterclaim.

  1. A Reply and Defence to Counterclaim should normally form one document.
  2. There are different time limits for the filing of a Reply and the Defence to Counterclaim. Consequently the court will normally order that the Reply and Defence to Counterclaim be filed at the same time.
  3. However a defendant cannot rely on a court making such an order. Where the court does make an order the Reply and Defence to Counterclaim can form separate documents.

PRACTICE DIRECTION 15

“3.2  Where a claimant serves a reply and a defence to counterclaim, the reply and defence to counterclaim should normally form one document with the defence to counterclaim following on from the reply.
3.2A  Rule 15.8(a) provides that a claimant must file any reply with his directions questionnaire. Where the date by which he must file his directions questionnaire is later than the date by which he must file his defence to counterclaim (because the time for filing the directions questionnaire under rule 26.3(6) is more than 14 days (small claims track) or more than 28 days (fast track and multi-track) after the date on which it is deemed to be served), the court will normally order that the defence to counterclaim must be filed by the same date as the reply. Where the court does not make such an order the reply and defence to counterclaim may form separate documents.”

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