What does “without prejudice” mean and why is it on the top of so many letters my lawyer gets from my husband’s lawyer?
A British Columbia Supreme Court decision released last week looked at the definition and meaning of without prejudice and applied it to the family law context.
There are lots of differently worded definitions of “without prejudice”.
I like to think of it generally as meaning:
What happens in settlement negotiations stays in settlement negotiations. A settlement offer cannot be brought up in court, put in an affidavit or used as evidence in proceedings (unless both parties agree).
What makes something without prejudice?
The Honourable Mr. Justice Cole cited a previous decision of the court, setting out the requirements for correspondence to be without prejudice:
The words “without prejudice” are not necessary to invoke the privilege. The privilege is determined by the circumstances. There are only two requirements:
1) A litigious dispute exists or is contemplated; and
2) The purpose of the communication is to buy peace or effect settlement or respond to such a communication.
So how does without prejudice work? Can you provide an example?
Here is a hypothetical example – My husband are recently separated. Our lawyers have organized a four-way meeting to see if we can resolve our disputes through negotiation. At the four-way meeting we discuss two hotly contested issues: who keeps the family dog and who gets to stay in the Sunday running group. I offer to give my husband the family dog if he will agree to move to Fort McMurray (so I won’t bump into him at the Running Room).
We cannot resolve our disputes and go to court. My husband tries bring up my earlier offer to give up the dog in court. Lucky for me, this offer is not admissible in the court proceeding because it is made in a settlement negotiation. Further, my husband could not use my offer to give up the dog as evidence that I did not want the dog or that I was a bad dog owner.
Why do we have “without prejudice”?
We have the concept of without prejudice to encourage settlement and the early resolution of disputes outside of the court process. If offers people made to try and settle matters could be brought up in court, far fewer offers would be made.
As a note, some feel that “without prejudice” is over used – and that if you make an offer it should be a reasonable one that you believe in. My thought on this is that it is useful to have without prejudice discussions and offers, as it helps move things forward. That being said, the phrase can be overused.
Are there limitations to something being “without prejudice”?
Yes, there are. You cannot use “without prejudice” to get away with/hide from misleading the court or perjury. As stated by Mr. Justice Burnyeat in the case of Berry v. Cypost:
While it generally the case that the public interest in encouraging settlements will not be served by making without prejudice statements or documents admissible, I am satisfied that the overriding public interest to discourage perjury will not be served by protecting potential evidence of perjury behind without prejudice settlement discussions. In the words of Tysoe, J.A. in Greenwood, the protection of without prejudice settlement discussions was “… never intended to give protection to this sort of thing” (at p. 268). As was stated by the authors of “The Law of Evidence in Canada”:
The privilege cannot be used as a means to deceive the courts as to the facts, by excluding evidence which would repel a charge of fraud made by a party or who is shown by the impugned communication to have effected a waiver or made an election (at p. 729).
Additionally, a party can make their offer “without prejudice” except to costs. As JP Boyd summarizes (in his 2009 blog on the topic of “without prejudice”):
Proper “without prejudice” letters can’t even be put into evidence to argue costs after trial, unless the letter contains a statement saying that the author intends to reply on the letter for the purpose of arguing costs.
Some helpful tips:
- Do not rely on something being without prejudice – it is important to make your intention abundantly clear at the beginning of a discussion (preferably record in writing that your negotiations are without prejudice. You do not want to later end up in a discussion/court hearing focused on if your communication was intended to be without prejudice (there are better ways to spend your time and money);
- Check with your lawyer before you shoot off an offer (your lawyer will have useful feedback on the offer you are making and if it is an appropriate time to make it);
- Do not use disrespectful/offensive language even if you think that you are using it in a “without prejudice” context (you never know where the correspondence will show up – being without prejudice does not mean people cannot read it;
- If you make a demand it may not be considered without prejudice; and
- If you are not sure if something is without prejudice, ask your lawyer.