Alli-Balogun v On the Beach Ltd & Ors

Factual and Procedural Background

The Plaintiff, a child who suffered a catastrophic brain injury while on holiday with her parents in August 2015 at a hotel swimming pool in Spain, brought proceedings against multiple Defendants. The injury occurred when the Plaintiff was approximately 8 years old and is now 14. The Plaintiff's claim centers on the alleged negligence of a lifeguard employed by the 4th Defendant, a company providing lifeguard services to the hotel, and the insurer of that company, the 5th Defendant.

The Plaintiff's case alleges that the lifeguard failed to supervise her effectively, resulting in her nearly drowning and sustaining severe brain injuries requiring permanent round-the-clock care. The 5th Defendant, a Spanish insurer, had a default judgment entered against it for failing to acknowledge service. The 5th Defendant now applies to set aside this judgment.

Procedurally, the claim was issued in April 2019 and served on the 5th Defendant in August 2019. The 5th Defendant did not acknowledge service by the deadline, leading to a default judgment granted in December 2019. Subsequently, the 5th Defendant contested jurisdiction based on a territorial exclusion clause in the insurance policy but abandoned this challenge in December 2020 and then applied to set aside the default judgment under CPR 13.3.

The proceedings involve five Defendants: the 1st Defendant, an English tour operator; the 2nd Defendant, a Spanish insurer of the 3rd Defendant; the 3rd Defendant, the hotel owner/operator; the 4th Defendant, the lifeguard services provider; and the 5th Defendant, the insurer of the 4th Defendant. The litigation against the 1st, 3rd, and 4th Defendants remains ongoing, with various defences filed and disputes about liability.

Legal Issues Presented

1. Whether the 5th Defendant has a real prospect of successfully defending the claim on the basis that the 4th Defendant had no liability to the Plaintiff under Spanish law.
2. Whether the default judgment against the 5th Defendant should be set aside pursuant to CPR 13.3, considering promptness and other discretionary factors.
3. The application and interpretation of Spanish law principles, including vicarious liability and burden of proof, in determining the 4th Defendant’s liability.

Arguments of the Parties

5th Defendant's Arguments

• The 5th Defendant contends it has a real prospect of successfully defending the claim because the 4th Defendant had no liability to the Plaintiff.
• The defence would align with the defences of the 1st and 3rd Defendants, questioning gaps and inconsistencies in the Plaintiff’s account requiring further particulars or amendments.
• The lifeguard left the pool at the request of the Plaintiff’s father, and there is no evidence that this caused or contributed to the injuries.
• The burden of proof under Spanish law lies with the Plaintiff, and the case depends on factual determinations to be made at trial.
• The application to set aside was made promptly after abandoning the jurisdictional challenge, which was a justifiable initial approach.
• There are other good reasons to set aside the judgment, including ongoing litigation against other parties and the absence of prejudice aside from losing the default judgment.

Plaintiff's Arguments

• The Plaintiff submits that the 5th Defendant has no real prospect of successfully defending the claim given the severity of the injuries and the circumstances of the lifeguard’s conduct.
• The lifeguard was negligent either by failing to notice the Plaintiff in the pool or by leaving the poolside unattended, both constituting breaches of duty.
• Joint liability applies under Spanish law, so the possible liability of other parties does not absolve the 4th or 5th Defendants.
• The police report indicates the lifeguard’s evidence was unreliable and unprofessional.
• The delay in applying to set aside the default judgment was excessive, as the jurisdictional challenge was abandoned late without explanation.
• The Plaintiff needs the judgment to remain in place to facilitate settlement or interim payments critical for her ongoing care and accommodation needs.

Table of Precedents Cited

Court's Reasoning and Analysis

The court first addressed the issue of promptness and other discretionary factors, concluding that the 5th Defendant acted promptly in applying to set aside the default judgment once the jurisdictional challenge was abandoned. The court found no reason to deny relief on discretionary grounds if a real prospect of defence existed.

Turning to the central issue, the court applied the test under CPR 13.3, requiring the 5th Defendant to show a real prospect of successfully defending the claim. The court noted the absence of a draft defence and the lack of cooperation from the 4th Defendant and lifeguard, resulting in no coherent factual account from the 5th Defendant’s side.

The court examined the Plaintiff’s pleaded facts, supported by a Statement of Truth and contemporaneous evidence including a police report critical of the lifeguard’s conduct and reliability. The court found the 5th Defendant’s proposed defence—largely consisting of putting the Plaintiff to proof and blaming others—lacked any real prospect of success.

The court acknowledged that Spanish law requires fault or negligence to be established and that liability is fact-specific. However, the facts as pleaded and evidence available pointed strongly to the lifeguard’s breach of duty, either by failing to notice the Plaintiff drowning or by abandoning his post. The joint liability principle under Spanish law further undermined the 5th Defendant’s argument that others’ potential liability would absolve it.

Accordingly, the court concluded that the 5th Defendant failed to demonstrate a real prospect of successfully defending the claim and that the default judgment should remain in place.

Holding and Implications

The court’s final decision was to REFUSE the 5th Defendant’s application to set aside the default judgment.

The direct effect of this ruling is that the default judgment against the 5th Defendant stands, affirming the Plaintiff’s entitlement to proceed with enforcement or settlement against this party. The judgment preserves the Plaintiff’s position in securing compensation for catastrophic injuries sustained. No new legal precedent was established; rather, the decision applied established principles regarding setting aside default judgments and the assessment of real prospects of defence under CPR 13.3 in the context of Spanish law on liability.