During the course of most disputes, both written and oral communication passing between the parties may be considered to be ‘Without Prejudice’ or ‘Without Prejudice Save as to Costs’ in an attempt to try to settle the matter. It is important, however, to understand what both of these terms actually mean.
What is the Without Prejudice rule?
When communications between parties are considered as Without Prejudice, this means that they usually cannot be used as evidence or made the subject of a disclosure. In the case of Suh v Mace (UK) Ltd  EWCA Civ 4,  All ER (D) 96 Jan, the Court of Appeal stated that the Without Prejudice rule governs the admissibility of evidence, to exclude all negotiations genuinely aimed at settlement being used as evidence.
How does communication qualify as Without Prejudice?
In order for communication to qualify as Without Prejudice, it must form part of a genuine attempt to resolve a dispute. Therefore, there are two aspects that must be present, namely:
- The genuine dispute that is to be resolved; and
- The genuine attempt to resolve it.
Written communications need not necessarily be marked as Without Prejudice for them to be considered as such, as Without Prejudice privilege can be implied (as shown in the case of Unilever plc v Procter & Gamble Co  All ER 783). However, it would be best to mark or indicate which communication is to be Without Prejudice, in order to express intent. That is because communication that was meant to be implied Without Prejudice may be considered on the subject of costs (as shown in Sternberg Reed Solicitors v Harrison  EWCH 2065 (Ch)).
Can Without Prejudice communication ever be admissible?
The answer to the above question is yes, although it must be clearly shown why the communication is not Without Prejudice (even though it may be marked as such) or that the Without Prejudice privilege should not apply. In the House of Lords case of Ofulue v Bossert  3 All ER, Lord Walker stated:
“As a matter of principle I would not restrict the without prejudice rule unless justice clearly demands it.”
Whilst Lord Hope stated:
“The Court should be slow to lift the umbrella unless the case for doing so is absolutely plain.”
It is also important to ensure that your intended Without Prejudice communication does not fall under one of the many exceptions to the rule, so that the benefit of the Without Prejudice privilege will apply.
What is communication that is Without Prejudice Save as to Costs?
Without Prejudice communication usually cannot be taken into consideration for costs due to the rule in Walker v Wilsher  23 QBD 335 but Without Prejudice Save as to Costs is an exception to that rule.
Therefore, if negotiations or discussions occur on the basis of them being Without Prejudice Save as to Costs they will become admissible when the Court considerers costs (as shown in Reed Executive plc v Reed Business Information Ltd  EWCA Civ 887,  4 All ER 942). It is important to recognise that though the Without Prejudice Save as to Costs communication can be considered on costs, prior to such, it will still enjoy the benefit of Without Prejudice privilege.
How can Nelsons help?
Matthew Clarke is a Trainee Solicitors at Nelsons.
At Nelsons, our expert Dispute Resolution team in Derby, Leicester and Nottingham have extensive experience in a wide area of legal matters. If you require any legal assistance with a dispute, please call us on 0800 024 1976 or alternatively contact us via our online enquiry form.Contact us