The defendant, Douglas Hallett, brought a motion to set aside a partial default judgment obtained by the plaintiff, Natural Energy Systems Inc. (NES), for $170,000 related to alleged misappropriated funds.
The court considered the promptness of the motion, the defendant's plausible explanation for default (lack of direct notice, financial and health challenges), and whether an arguable defence existed.
The court found that the defendant had established an arguable defence regarding the financial transactions and that the interests of justice favored setting aside the default judgment.
The defendant's claims for injunctive relief and security for costs were dismissed as abandoned or not established.
The claim for a stay based on an arbitration clause was dismissed without substantive determination, without prejudice to the defendant seeking this relief after the close of pleadings.
The defendant was awarded partial indemnity costs of $12,000.
