A judgment or order may be set aside if given, entered or made irregularly, illegally or against good faith: r 36.15(1).

The focus of r 36.15(1) is on the judgment or order that is attacked and the question is whether it was “given, entered or made irregularly, illegally or against good faith”. The focus is on an irregularity in these steps not on the merits of any decision or the irregularity of other steps in the proceedings: Perpetual Trustees Australia Ltd v Heperu Pty Ltd (No 2) (2009) 78 NSWLR 190 at [16].

In that case, it was observed at [17] that r 36.15(1) applies with particular force to default or consent judgments or orders and those given or made ex parte and that it can only have limited application to judgments and orders made or entered after a hearing on the merits at which all parties were represented and fully heard.

For an example of a judgment set aside if given or entered irregularly, see Arnold v Forsythe [2012] NSWCA 18 and Violi v Commonwealth Bank of Australia [2015] NSWCA 152.

For an example of a judgment set aside as entered against good faith, see Chand v Zurich Australian Insurance Ltd [2013] NSWSC 102.

For an unsuccessful attempt to rely upon s 63 of the CPA as giving the court power to set aside a judgment or order: see Perpetual Trustees Australia Ltd v Heperu Pty Ltd (No 2), above, at [20]–[49].

A judgment or order may be set aside by consent order: r 36.15(2).

The court may set aside or vary a judgment or order if a notice of motion for such an order is filed before the entry of the judgment or order sought to be set aside: r 36.16(1).

Such an order is variously referred to as “recalling”, “reopening”, “reviewing” or “reconsidering” a judgment or order.

The following principles are extracted from the judgment of Mason CJ in Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 at 301–303. (His Honour dissented on the ultimate issue in the case but his statements of general principle were not questioned in the majority judgments.) The decision turned on the inherent jurisdiction of the High Court but the same principles would apply to the subrule.

In Wentworth v Woollahra Municipal Council (1982) 149 CLR 672, at 684, it was said that, “[g]enerally speaking, [the power to reopen] will not be exercised unless the applicant can show that by accident without fault on his part he has not been heard.” It was, however, explicitly stated in Autodesk, by Mason J (at 302) and by Gaudron J (at 322), that the jurisdiction to re-open is not confined to such circumstances. No other judge in Autodesk disagreed with those statements.

Since r 36.16(1) requires the filing of a notice of motion, it has no application to a setting aside or variation by the court of its own motion.

In Autodesk Inc v Dyason, above, at 302, Mason J (speaking of the High Court’s inherent jurisdiction) referred specifically to the power of the court to recall a judgment or order on the judge’s own initiative where the judge believed he had “erred in a material matter in his approach to the case”. The Supreme Court would have the same inherent power to recall a judgment or order of the court’s own motion before the judgment or order is entered.

Where an apparent error can readily be addressed without the need to resort to expensive and time-consuming appeal proceedings, that course should be permitted and encouraged: Nominal Defendant v Livaja [2011] NSWCA 121 at [23]. In some cases, for example where a trial judge, without the benefit of transcript, is delivering an oral judgment from handwritten notes, the public interest in the finality of litigation may carry less weight than in other circumstances: Livaja at [23].

It is unclear whether the District Court and the Local Court have a corresponding implied power to recall a judgment or order of the court’s own motion. However, the point is unlikely to arise having regard to the provisions for the almost automatic entry of judgment in the UCPR and the terms of r 36.16(3B) dealt with below.

In Consolidated Lawyers Ltd v Abu-Mahmoud [2016] NSWCA 4, Macfarlan JA (Bathurst CJ and Tobias AJA agreeing) observed at [39]–[41] that where it appears that the primary judge has overlooked a significant point in formulating the court’s judgment, the course that should be adopted in the absence of particular, valid reasons for not doing so, is for an application to be made to the judge pursuant to r 36.16 to set aside or vary the judgment. The ground of the application should be that the judge had not dealt with a significant submission.

For further examples relating to the power to set aside or vary a judgment or order before entry, see Ritchie’s at [36.16.45] and [36.16.50] and Thomson Reuters at [r 36.16.100] and [r 36.16.120].

If a notice of motion for setting aside or variation of a judgment or order is filed within 14 days after the judgment or order is entered, the court may set aside or vary the judgment or order under r 36.16(1) as if the judgment or order had not been entered: r 36.16(3A). This power does not extend to a judgment or order that was not specified in the notice of motion: Malouf v Prince (No 2) [2010] NSWCA 51.

Further, the court may of its own motion set aside or vary a judgment or order within 14 days after entry as if it had not been entered: r 36.16(3B).

Despite r 1.12, the court may not extend the time limited by r 36.16(3A), (3B) or (3C).

There is an overlap between r 36.16(3B), and r 36.17, the slip rule (as to which, see [2-6680]).

As a general rule, apart from the exceptions which follow, judgments or orders which have been formally recorded or entered can only be varied or discharged on appeal:

See also Grierson v The King (1938) 60 CLR 431 at 436; Gamser v Nominal Defendant (1977) 136 CLR 145; DJL v The Central Authority (2000) 201 CLR 226 at 245; and Meehan v Glazier Holdings Pty Ltd (2002) 54 NSWLR 146.

Rule 36.16(2) of the UCPR provides that the court may set aside or vary a judgment or order after judgment is entered if the judgment or order is a default judgment other than a default judgment given in open court. That orders have taken effect does not extinguish these powers: Goater v Commonwealth Bank of Australia [2014] NSWCA 382.

The following principles are extracted from the judgment of Hope JA in Adams v Kennick Trading (International) Ltd (1986) 4 NSWLR 503 at 506–507:

The importance of a defence on the merits relative to countervailing considerations (per Evans v Bartlam, above) has been emphasised. In Byron v Southern Star Group Pty Ltd t/as KGC Magnetic Tapes (1995) 123 FLR 352, Priestley JA said at 364:

In Cohen v McWilliam (1995) 38 NSWLR 476 at 480–481, Priestley JA re-affirmed what he had said in Byron and, by way of illustration, quoted with approval from the Full Federal Court decision in Davies v Pagett (1986) 10 FCR 226 at 232, as follows:

On the other hand, the explanation for default may be sufficient. See the passage quoted below from Taylor v Taylor (1979) 143 CLR 1.

The discretionary power of the court to set aside an undefended judgment is contained in r 36.16(2)(b). This provides that the court may set aside or vary a judgment or order after judgment is entered if the judgment or order has been given or made in the absence of a party, whether or not the absent party had notice of the relevant hearing or of the application for the judgment or order. That orders have taken effect does not extinguish these powers: Goater v Commonwealth Bank of Australia, above.

Rule 36.16(2)(b) provides an unfettered, though judicial, discretion. It is unwise to attempt to lay down rules of universal application in the exercise of that broad discretion which necessarily involves the court in making a broad evaluative judgment. The questions posed by Jordan CJ in Vacuum Oil v Stockdale (1942) 42 SR (NSW) 239 about the exercise of a predecessor to this judicial discretion remain appropriate: it is necessary to consider (a) whether any useful purpose would be served by setting aside the judgment, and (b) how it came about that the applicant became bound by a judgment regularly obtained: Northey v Bega Valley Shire Council [2012] NSWCA 28 at [16]; Pham v Gall [2020] NSWCA 116 at [55]; [108], [110]. The party in default needs to explain the reason for the default and the nature of the proposed defence. Those matters inform the exercise of discretion: Pham v Gall at [56]. An applicant under UCPR 36.16(2)(b) must show by evidence that he or she has a reasonably arguable defence on the merits: Ibrahim v Ayoubi [2013] NSWCA 405; Foundas v Arambatzis [2020] NSWCA 47 at [14].

In the absence of urgency or some other reason, a party with an interest in the matter in question has a right to be heard, failing which the judgment or order will be set aside.

The rule is in terms which empower the court to set aside an ex parte judgment or order where a party with notice has failed to attend due to accident or mistake: Wentworth v Rogers (unrep, 28/8/97, NSWSC) Sperling J, pp 36–37; leave to appeal refused Wentworth v Rogers (unrep, 12/6/97, NSWCA).

Mere absence, of itself, is insufficient to justify setting aside an order. There must be some added factor that makes it unjust for the order to stand: Northey v Bega Valley Shire Council [2012] NSWCA 28.

Where proceedings are by necessity heard ex parte, a high degree of candour is required, including disclosure of facts adverse to the moving party. Breach of that obligation will almost invariably result in the determination being set aside: Garrard v Email Furniture Pty Ltd (1993) 32 NSWLR 662 per Mahoney AP and Clarke JA at 676–677.

Rule 36.16(2)(b) and other provisions of the UCPR do not apply where the court is exercising Federal jurisdiction and the Constitution or the relevant Commonwealth law “otherwise provides”. For example, in Grant Samuel Corporate Finance Pty Ltd v Fletcher (2015) 89 ALJR 401 it was held that the rule could not enable time to be extended beyond the period provided by s 588FF of the Corporations Act 2001.

Rule 36.16(2)(c) provides that, in the case of proceedings for the possession of land, the court may set aside or vary a judgment or order after the judgment or order has been entered if the judgment or order has been given or made in the absence of a person whom the court has ordered to be added as a defendant, whether or not the absent person had notice of the relevant hearing or of the application for the judgment or order.

Rule 36.16(3) provides that, without limiting subrules 36.16(1) and (2), the court may set aside or vary any order except so far as it determines a claim for relief or a question arising on a claim for relief or determines part of a claim for relief.

Orders relating to practice and procedure will be freely reviewed in the light of changing circumstances but not otherwise: DPP (Cth) v Geraghty [2000] NSWSC 228; Hillston v Bar-Mordecai [2002] NSWSC 477.

The court may, on application or of its own motion, correct a clerical mistake or an error arising from an accidental slip in a judgment, order or certificate: r 36.17. A “party” in this rule means any person who has an interest in the proceedings and is not limited to persons formally joined as parties to the proceedings: JP Morgan Chase Bank, National Association v Fletcher (2014) 85 NSWLR 644 at [100]–[147], [149], [162]–[164].

By reason of the overriding objective in s 56 of the CPA (to facilitate the just, quick and cheap resolution of the real issues in the proceedings), words such as “error” and “correct” in the slip rule should not be given a narrow interpretation: Newmont Yandal Operations Pty Ltd v The J Aron Corp & The Goldman Sachs Group, Inc (2007) 70 NSWLR 411 at [116]. Some earlier authorities should now be treated with caution: Newmont Yandal, above, at [117].

Commonplace applications of the rule include correcting an arithmetical mistake in the calculation of interest or a wrong figure or date in an order.

The rule extends to matters overlooked, such as specifying a date for compliance with an order (Re Walsh (1983) 83 ATC 4147), or adding an amount for interest to the judgment (L Shaddock and Associates Pty Ltd v Parramatta City Council (No 2) (1982) 151 CLR 590), or where the judge has misunderstood the evidence (Hall v Harris (1900) 25 VLR 455 at 457); or counsel’s submissions: Yore Contractors Pty Ltd v Holcon Pty Ltd (unrep, 17/7/89, NSWSC).

The rule also extends to a correction made in order to carry into effect the actual intention of the judge and/or to ensure that the order does not have a consequence which the judge intended to avoid adjudicating upon: Newmont Yandal, above, at [114], [116], [185], [194].

The rule does not extend to correcting a deliberate decision (Expo Aluminium (NSW) Pty Ltd v Pateman Pty Ltd (No 2) (unrep, 29/4/91, NSWCA)) or to making further orders on a point not in issue at the hearing: Lauer v Briggs (No 2) (1928) 28 SR (NSW) 389; D’Angola v Rio Pioneer Gravel Co Pty Ltd [1977] 2 NSWLR 227.

In the Supreme Court at least, the inherent jurisdiction of the court extends to correcting a duly entered judgment where the orders do not truly represent what the court intended: Newmont Yandal at [74], [79], [83], [185], [194].

The court has power to make an order for restitution of an overpayment made in consequence of the error corrected under the rule: Prestige Residential Marketing Pty Ltd v Depune Pty Ltd (No 2) [2008] NSWCA 341 at [9].

The judge who made the orders is not disqualified from correcting them under the slip rule and should not recuse himself or herself: Newmont Yandal, per Spigelman CJ at [181] and Handley JA at [195], [196].

For an example of refusal to make an order on the ground of delay, see Georgouras v Bombardier Investments (No 2) Pty Ltd [2013] NSWSC 1549. See also Maclean v Brylewski [2023] NSWCA 173 at [34] where the court held that the correction of orders made in December 2022 and not corrected until June 2023 was appropriately made and obvious on the face of the orders and did not in any way prejudice the applicant or cause serious delay.

The court is not always obliged to give notice to the parties before exercising its powers of its own motion under UCPR r 36.17 to correct a mistake/error: see Decision Restricted [2018] NSWSC 4 at [32]. Consideration must be given to whether procedural fairness requires notice to be given to the parties: Decision Restricted, above, at [33]–[42].

Courts are empowered to correct obvious drafting errors in all legal documents, including primary and delegated legislation: Coal & Allied Operations Pty Ltd v Crossley (2023) 112 NSWLR 130 at [43]–[54]; Director of Public Prosecutions (Nauru) v Fowler (1984) 154 CLR 627. In Coal & Allied Operations Pty Ltd v Crossley, the Court of Appeal was not required to quash the decision and remit the matter but was empowered to correct an obvious drafting error by reading $36 as $3 per scanned page in the scale of costs: at [69].

A judgment or order against a person under a business name may be varied to make it a judgment or order in the person’s own name: r 36.18.

An appeal in criminal proceedings may be re-opened, notwithstanding that judgment on appeal has been entered, if there has been a denial of procedural fairness, for example, where it is found that the appeal has not been determined on the relevant evidence: R v Burrell [2007] NSWCCA 79 at [41]. The rationale is that, in such a case, there has been no hearing on the merits and, accordingly, the matter has not been finally determined: Burrell at [22] and [41].

In relation to civil proceedings the same principle applies: DJL v The Central Authority, above, per Callinan J, at [189]; Miltonbrook Pty Ltd v Westbury Holdings Kiama Pty Ltd (2008) 71 NSWLR 262 at [85]–[87]. But with the qualification that different considerations may arise in civil proceedings, as where questions of status or the rights of third parties are involved: R v Lapa (No 2) (1995) 80 A Crim R 398 at 403, cited in Burrell at [25].

Regarding denial of procedural fairness by failure to disclose judicial reasoning, see Lichaa v Boutros [2021] NSWCA 322 at [48]–[50]. See also Williams v Harrison [2021] NSWSC 1488, where a self-represented plaintiff was denied procedural fairness because he was not heard when he had a right to be heard and, as well, the magistrate failed to give reasons when obliged to do so: at [28].

That the judgment was obtained by fraud is a further exception to the general rule: DJL, per Callinan J at [189]. However, in this instance, the judgment should be impeached in independent proceedings: DJL, n 258 at p 291.

The principles as to the usual scope of liberty to apply were stated in Abigroup v Abignano (1992) 112 ALR 497 at 509 as follows (per Lockhart, Morling and Gummow JJ):

Their Honours went on to cite with approval the following passage in Ritchie’s at [36.16.65]:

A self-executing order consists of an order that a party take a specified step in the proceedings by a certain date and that, failing compliance, a specified final order (such as for the entry of judgment or that the proceedings stand dismissed) will come into effect.

Earlier authorities held that the courts had no power to circumvent such an order once it came into effect, for example, Whistler v Hancock (1878) 3 QBD 83; Bailey v Marinoff (1971) 125 CLR 529. These authorities should now be disregarded. The court has power to extend the time for compliance with a self-executing order notwithstanding that the time for compliance has passed and the order has come into effect: FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268.

The Supreme Court may in the exercise of its inherent jurisdiction set aside consent orders if the underlying agreement upon which they were based is void or voidable: The Owners Strata Plan No 57164 v Yau [2017] NSWCA 341 at [72], [76], [80], [195] and [226]. Such relief is discretionary even if some basis for setting aside the order has been established: The Owners Strata Plan No 57164 v Yau, above, at [81]–[83], [195], [226].

Section 73 of the CPA provides that the court may resolve any dispute as to whether and on what terms proceedings have been compromised or settled, and may make such orders as it considers appropriate to give effect to such a determination.

A consequential order giving effect to such a determination could include an order setting aside or varying the order or judgment ostensibly implementing a compromise or settlement.

For examples of the application of s 73, see Yule v Smith [2012] NSWCA 191 and Mills v Futhem Pty Ltd (2011) 81 NSWLR 538 at [42]–[43].