The rule of prejudice is a common protection. This means that only all parties to the undamaged communication concerned can jointly waive it. Without Prejudice (“WP”) is a common law concept and a form of legal privilege whose purpose is to allow parties trying to reach an agreement to negotiate freely. If there is a dispute between the parties, wp discussions (sometimes called “informal” discussions) or correspondence can be used to find a solution. Usually, the “WP” rule prevents statements made in a genuine attempt to resolve an existing dispute from being presented to the court or tribunal as evidence of the confession made. “Unprejudiced” or “WP” is a term that is most familiar to litigators, but is also often used by non-contentious lawyers and laymen. It is often abused and seems to cause a certain amount of mysticism and confusion. The purpose of this guide is to clarify the meaning and effect of the term “without prejudice”, when it should be used and under what circumstances the protection it provides does not apply. Suppose that A, B and C are all parties to the same dispute, with A being the plaintiff and B and C being the co-respondents. If A agrees with B but pursues the claim against C, can the impartial communications leading to the comparison between A and B be considered evidence in the ongoing dispute between A and C? The answer lies in the House of Lords decision in Rush & Tompkins -v- GLC17. Rush & Tompkins (a construction company) was involved in a dispute with the GLC and a second defendant and eventually reached an agreement with the GLC through unbiased negotiations. The House of Lords ruled that the content of these hearings was not accessible to the second defendant. To pretend otherwise would discourage parties to multi-party disputes from attempting a genuine settlement.
Lord Griffiths said: Yes. A court may allow the use of WP material if the fairness of the case so requires, although even then such use is normally limited only to certain purposes (as opposed to the general use of WP material). Conversely, communications that are not explicitly marked as “without prejudice” may nevertheless be protected by a settlement privilege if the communication is part of a genuine comparative discussion. Substance tends to judge form, but it`s obviously safer to mark your communication as “bias-free” if it`s really part of comparison conversations. “Without prejudice” or “WP” is a term that lawyers and non-lawyers use regularly. It is not uncommon for it to be used in the wrong context or not to be used when it should have been used. The term can and should be used when you wish to communicate or respond to a settlement offer, indicate your willingness to negotiate or review your position, and if you wish to make a counter-offer or counter-offer. The assertion that these communications are “without prejudice” brings them within the protected scope of “settlement privilege”, keeps them “off file” and makes them (in most cases) inadmissible, as mentioned above. Less extreme examples of cases where “without prejudice” could be waived are cases where the dispute itself concerns whether a binding settlement or other agreement has been reached, where there are allegations of misconduct such as extortion or fraudulent misrepresentation, and where a limitation period or other time limit has been missed and the party concerned wishes to argue that the reason she did not act earlier is due to a settlement notice she received from her opponent.
The party that marked the notice as “without prejudice” may also waive protection in certain circumstances. The injury rule prevents statements made as part of a genuine attempt to resolve an existing dispute from being brought to justice. But if there is a long period of time after the failure of negotiations and the opening of a legal dispute, does this prevent the parties from claiming that the negotiations were not affected, because at that time it cannot be said that there was an “existing dispute”? How close should failed negotiations be to the start of the legal dispute? In any discussion or meeting, it is best to mention this from the beginning – see also the next section on this subject – and get confirmation from the other party that they accept that the communication is not affected. This approach also extends to cases involving a chain of communication. What happens if the words “without prejudice” are initially used by the parties but do not repeat them in subsequent exchanges? If protection is supposed to apply to the first exchange of communications, all subsequent communications will be covered provided that they are part of the same set of genuine negotiations.4 However, if there is evidence that the chain of communication has been interrupted in such a way that subsequent communications are clearly intended to take place on an open basis (as opposed to without prejudice), then the protection will fall from this point. It is not always necessary for the communication itself to be marked as “without prejudice” for the privilege to be claimed. .