What Does Without Prejudice Mean in the UK?

The term ‘without prejudice’ can be confusing if you are unfamiliar with its legal implications. Usually, it is found in letters or documents, and at face value, it is not entirely clear what it might mean. ‘Without prejudice’ has a technical meaning within the law of evidence, and it is often used in legal negotiations. This article will outline what you need to know about the term. It will also explain how using evidence ‘without prejudice’ can help you during a legal settlement.

What Does the Term Mean?

Simply put, the term ‘without prejudice’ means that a party cannot use communication as evidence against the other party during a dispute. It is common when conveying information during settlement negotiations.  The protection extends to both verbal and written communications.

When is it Used?

When a party uses ‘without prejudice’ in written communication, they usually clearly label it at the top of a letter. Generally, an open letter sets out the parties’ legal position. A ‘without prejudice’ letter usually follows an initial open letter, outlining a commercial settlement proposal. 

When parties use the term in a spoken discussion, both parties must know what ‘without prejudice’ means for it to apply. Therefore, as a general rule, it is a good idea to consult a legal professional when engaging the rule during settlement discussions. 

How Can I Use the ‘Without Prejudice’ Rule?

As mentioned, engaging the ‘without prejudice’ rule allows you to reach a concluded settlement agreement without worrying about whether the other party will use your communication against you.

However, simply using the words ‘without prejudice’ will not suffice to engage the rule. You must also:

• make a ‘genuine attempt’ to settle an existing dispute;
• not use any illegal or misleading comments during the negotiation; and
• not use any material that has already been disclosed without the rule.

Making a ‘genuine attempt’ is essential to qualify for the ‘without prejudice’ rule. A disingenuous attempt, even with the words ‘without prejudice’, will not engage the rule. Similarly, if you do not use the words but you make a genuine attempt at settling the dispute, then a court might interpret your communication as nonetheless engaging the rule.

For example, you might combine the open letter and the ‘without prejudice’ letter into one document, with a heading clarifying the ‘without prejudice’ section. In this way, only a section of the document will be ‘without prejudice’. However, we recommend that you separate this aspect of your correspondence from the open aspect. Doing so will minimise the risk of without prejudice communication being disclosed to the court.

When Should I Not Use ‘Without Prejudice’?

The ‘without prejudice’ rule is appropriate for settlement discussions on an existing dispute. For this reason, it is not useful to use it in a communication that is unrelated to a dispute. For example, using “without prejudice” in a routine business communication, such as negotiating the initial terms of a contract or discussing a business partnership, would be inappropriate as there is no existing dispute to resolve.  

Why Can I Not Use ‘Without Prejudice’ Communication as Evidence?

The idea behind the ‘without prejudice’ rule is to encourage settlements instead of going to court. The English courts, for example, encourage parties to attempt to resolve a matter before proceedings are issued because it is usually more cost-efficient for the parties and helps to alleviate the burden on the judicial system.  

Is ‘Without Prejudice Save As To Costs’ the same as ‘Without Prejudice’?

The term ‘without prejudice save as to costs’ adapts the standard ‘without prejudice’ rule. It protects communications during the main proceedings but allows the court to consider them when deciding the issue of costs after judgment has been given. This approach encourages parties to make reasonable settlement offers by enabling courts to examine negotiation conduct when determining how costs should be apportioned. For example, if a party rejects a reasonable offer and subsequently achieves a less favourable outcome at trial, the court may take this into account when deciding how to divide the legal costs between the parties. 

To effectively use the “without prejudice save as to costs” rule, follow these guidelines:

• clearly label your communication as ‘without prejudice save as to costs’; 
• ensure your offer is genuine and reasonable; and 
• keep detailed records of all such communications. 

It is important to remember that this exception only applies after the court has decided on the main issues of the case.

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Can I Use ‘Without Prejudice’ in Digital Communications?

How you should use ‘without prejudice’ depends on the type of digital communication:

• Emails: Clearly mark the subject line and the body of the email as ‘without prejudice’. However, remember that marking alone is not enough; the content must genuinely relate to settlement negotiations.
• Instant Messaging: Establish the ‘without prejudice’ nature of the conversation at the beginning of the chat.
• Video Calls: Verbally state the ‘without prejudice’ status at the start of the call and record this in any minutes or notes.

• Cloud Storage and Shared Documents: Restrict access to relevant parties and clearly mark documents as ‘without prejudice’.

Key Takeaways

Adding the words ‘without prejudice’ to a communication can help you reach a faster settlement. This is because when used correctly, the words will assure both parties that they can negotiate frankly without worrying about future legal implications. You can use the rule in both written and oral communication, so long as both parties know of its legal meaning. For this reason, we recommend that you seek professional legal advice during the settlement process.

Finally, keep in mind that to engage the rule, you must make a genuine attempt at a settlement agreement. If your attempt is not genuine, the courts will not accept the communication as ‘privileged’ within the law of evidence. 

If you need legal advice regarding ‘without prejudice’ and evidence, our experienced disputes lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.

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