17 May 2021
The words “without prejudice” are arguably some of the most misused words in business and commercial dealings.
Using those words does not automatically and magically cloak your documents, correspondence or discussions with the protection that it will not be used against you in Court proceedings.
To obtain that benefit, those documents, correspondence and discussions must be made “in connection with an attempt to negotiate a settlement of a dispute”.
The “without prejudice” privilege arises from section 131(1) of the NSW and Commonwealth Evidence Act 1995 and excludes certain communications and documents being used against a party in court proceedings.
That section states:
Evidence is not to be adduced of:
(a) A communication that is made between persons in dispute, or between one or more persons in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute; or
(b) A document (whether delivered or not) that has been prepared in connection with an attempt to negotiate a settlement of a dispute.
It is often preferable to resolve a dispute to save the time and costs involved in extensive litigation.
Parties therefore often make concessions and admissions in an attempt to resolve a dispute.
The “without prejudice” privilege protects those concessions and admissions from being admitted as evidence in court, as a means to promote and encourage genuine settlement negotiations between parties.
For the without prejudice privilege to arise, the document or correspondence must be created:
Lawyers and business people alike frequently fall into the trap of thinking that marking or stating “without prejudice” on communications or documents will magically make them invisible in Court proceedings or that they are “off the record”.
The pure use of the words itself does not attract the “without prejudice” privilege.
Further, a document can be covered by the without prejudice privilege even if it is not expressly marked so, so long as it is in relation to a dispute and is connected with a genuine attempt to resolve the dispute.
The privilege can also be waived with the consent of both parties.
There are however some exceptions to the “without prejudice” privilege which would enable such documents and communications to be disclosed to the Court.
Some of these situations are where the document, correspondence or discussion:
For further information, please do not hesitate to contact Anish Wilson on (02) 8239 6514 or at firstname.lastname@example.org.
This communication is sent by Kreisson Legal Pty Limited (ACN 113 986 824). This communication has been prepared for the general information of clients and professional associates of Kreisson Legal. You should not rely on the contents. It is not legal advice and should not be regarded as a substitute for legal advice. The contents may contain copyright.
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