Insights

The Without Prejudice Rule: Insights from the Latest Case Law 

Introduction  

In the recent case of Samuel Arthur Jones v Neal Tracey & Ors, a letter marked as ‘Without Prejudice’ came under scrutiny. The judgment handed down by Master Marsh provides insight into the legal interpretation of the Without Prejudice rule in the context of the parties’ engagement with alternative dispute resolution (ADR). 

Overview  

The Without Prejudice principle allows parties involved in a dispute to engage in negotiations and settlement discussions without worrying that anything said or written during those discussions will be admissible as evidence against them in court. This rule aims to foster an environment of openness and encourage parties to resolve disputes amicably and without formal litigation. 

There are, however, certain exceptions to this rule. For instance, if the parties reach a binding agreement during the negotiations, the agreement can be considered admissible evidence. Additionally, evidence of Without Prejudice communications can be used to explain a party’s subsequent conduct, or to determine the legality of an agreement.  

As such, the Without Prejudice label should not be seen simply as a cloak of invisibility. Rather, it is the content of the communications themselves that are key. 

Case law in this area has further defined and clarified the application of the rule. In the case of Rush & Tompkins Ltd v. GLC, the House of Lords held that the rule applies to communications made with the aim of settling existing disputes, as well as those made with a view to preventing future disputes. In Oceanbulk Shipping & Trading SA v. TMT Asia Ltd, the Supreme Court ruled that the protection of the Without Prejudice rule can extend to cover negotiations taking place between multiple parties. 

Samuel Arthur Jones v Neal Tracey & Ors  

The recent case of Samuel Arthur Jones v Neal Tracey & Ors has shed further light on the rules surrounding Without Prejudice correspondence. The case involved a negligence claim against the defendants by the claimant. At trial, the claimant sought to rely on the Without Prejudice communications to support his claim. The defendants argued that the communications were inadmissible. 

The key issue in this case was whether a letter marked as ‘Without Prejudice’ actually fell within the scope of the overarching rule. The judge, Master Marsh, acknowledged that the letter was indeed sent on a Without Prejudice basis and marked as such. However, he determined that it was not a letter relating to a specific offer, but rather a discussion of the use of ADR.  

The judge highlighted the claimant’s failure to engage more positively with ADR and concluded that the letter was “plainly not” intended to be Without Prejudice. The lack of specificity regarding the proposed form of ADR demonstrates the importance of clearly defining the ADR process that parties wish to pursue. 

Conclusion 

The rules surrounding Without Prejudice correspondence in English litigation continue to be vital for parties seeking amicable resolution and settlement. Parties should be aware of the exceptions to the rule and weigh the potential risks before engaging in such negotiations. While marking a letter as ‘Without Prejudice’ provides some level of protection, it does not guarantee that a communication will be treated as such if the intention of the parties or the contents of the correspondence do not meet the essential criteria. For correspondence relating to ADR, the Jones case underscores the importance of defining the type of ADR that parties wish to pursue, recognizing the various approaches available beyond mediation, and actively engaging in the process.

*This article is not legal advice but provides a general overview. The specific details of your case will determine the best course of action.