What Does Without Prejudice Mean?

In correspondence with legal professionals, you may encounter the terms “without prejudice” or “without prejudice save as to costs” appearing frequently in letters and emails. Understanding this terminology is essential, as it serves an important function in legal communications, allowing parties to communicate freely while preserving their legal rights. This article will outline what these phrases mean in the context of legal communication and set out why they are so important in preserving your rights.

What does “Without Prejudice” mean?

The phrase “without prejudice” is used in legal situations to protect conversations or written messages between parties trying to settle disputes. When someone labels their communication as “without prejudice”, it means that what they say or write cannot be used against them later in Court.

Essentially, this legal principle is a way for people to talk openly about resolving issues without worrying that their words will harm their case if the matter goes to Court.

Is “Without Prejudice” a coverall protection?

The words “without prejudice” do not provide a ‘coverall’ protection. Without prejudice privilege is only effective if it relates to a settlement offer or statement of compromise.

Without prejudice privilege cannot be used to deliberately avoid liability. For example, illegal or misleading comments made in the course of negotiations to settle will not be protected by without prejudice privilege. Further, the privilege can be waived with the consent of both parties.

The decision in Unilever Plc v Procter & Gamble Co [2001] outlines several circumstances under which the “without prejudice” privilege may not be invoked which include:

1. if both parties consent or either party waives their right to object;
2. communications that can be admissible in Court to clarify delays in initiating or pursuing litigation;
3. if a without prejudice communication serves as evidence of an abuse of privilege, such as blackmail;
4. in situations where one party makes representations during the communication that the opposing party relies upon, these communications might be permitted as evidence of estoppel;
5. if an agreement reached through without prejudice communications is later challenged due to undue influence, misrepresentation, or fraud; or
6. if the communication evidences a concluded compromise agreement.

What does “Without Prejudice Save as to Costs” mean?

The term “without prejudice save as to costs” refers to a legal communication that carries certain privileges until a court delivers its judgment. During this period, parties can discuss settlement options without fear that what they say will be used against them in Court. However, once a judgment is made, the content of these communications can be considered when determining which party should pay legal costs.

In general, in legal disputes, the party that loses the case is typically required to cover the successful party’s legal costs. The extent of these costs hinges on how the parties behaved throughout legal proceedings. Notably, Courts often consider whether either party attempted settlement negotiations before resorting to litigation. Thus, labelling a settlement offer as “without prejudice save as to costs” can serve as a strategic tool in settlement negotiations, as rejecting such an offer might ultimately impact the cost assessment after the trial concludes.

Why is it important for communications to be without prejudice?

The protection afforded by without prejudice privilege allows parties engaged in a dispute to communicate openly and honestly during negotiations. This confidentiality ensures that their statements cannot be used against them in court if a settlement agreement is not reached.

Communication with Lewis Kitson Lawyers

At Lewis Kitson Lawyers, we place great importance on ensuring that you fully understand all the terminology used in our communications, as well as in any correspondence we send on your behalf. If you ever have any questions or uncertainties regarding specific legal terms found in our letters or emails, please feel free to contact any member of our team for clarification.