The defendant, Rock Con Forming Ltd., moved to set aside a noting in default, a default judgment, and a notice of garnishment, and sought leave to file a statement of defence and crossclaim.
The action arose from a construction project where Quadform Ltd. claimed non-payment for services.
Rock Con argued it was never properly served with the statement of claim and had a meritorious 'pay when paid' defence.
The court found that while Rock Con likely had notice of the action, Quadform failed in its duty of full and fair disclosure by not checking Canada Post tracking history for registered mail service when seeking default judgment ex parte.
Given Quadform had already received payment from a co-defendant, the court granted Rock Con's motion, setting aside the default judgment and garnishment, and allowing it to file a defence, but made no order as to costs due to both parties' conduct.