Written by Team Farallon
A without prejudice letter is a legal term that is usually used to settle legal disputes. These letters are protected by the Evidence Act, which states that such letters cannot be considered evidence in court. This means that if the case goes to court, both parties would not be able to use these letters against either party.
It is important to note that if you have received such a letter, it was probably written by a lawyer and you might wish to consult with one as well. This article will guide you through understanding these letters and what you can expect.
Such letters function as a way for both parties to openly communicate and negotiate with each other. This would allow both parties to come to a mutual resolution by making fair compensations where applicable.
For example, to avoid going to court, Party A sends Party B a without prejudice letter. In this letter, Party A offers Party B a certain settlement. This without prejudice rule would allow Party A to make a sincere offer without the fear that their offer would be used against them in court as a benchmark number. This allows the chance for peaceful conflict resolution.
If the letter is without prejudice save as to costs, this means that the letter cannot be produced until after the court has decided the outcome. After the court has decided on the outcome, the letter can then be produced for the sole purpose of the division of legal costs.
This is only applicable in the scenario whereby one party had previously made a generous offer to the other party in hopes of a resolution. However, the party rejected the offer and instead, the court awarded the party an amount that is lesser than the offer.
In this particular scenario, the writer of the letter may argue that the legal costs that both parties have spent were unnecessary. The court may then order the party to absorb the legal cost of the other party.
It is worth noting that the words “without prejudice” need not be clearly stated in the letter for it to apply. This rule applies as long as these requirements are met:
As long as the requirements mentioned above are not met, either party might argue that the rule should be admissible. There are also a few technical exceptions to this rule. Some exceptions include false evidence or claims, where the court may decide to then remove such protections.
Another exception could be through mutual consent to waiver this protection, where both parties agree that the letters can be used for evidence.
If you do receive such a letter, keep in mind that your response is extremely important. If you do not respond accurately, your response could be used against you in court. To avoid such circumstances, we highly recommend you consult a lawyer for legal advice.
Here are the general guidelines for responding to a letter:
You should respond to the letter as soon as possible to indicate your receipt of the letter and indicate your general stance. You should do this through a lawyer if you have one.
You should attempt to negotiate with the other party to try to achieve a peaceful conflict resolution without going to court. Should this fall through, you may seek mediation through a neutral third party to try and negotiate a settlement.
Should all attempts at negotiation and mediation fall through, you may consider taking legal action.
While the purpose of a “Without Prejudice” letter is an attempt at peaceful conflict resolution, if you do not respond correctly, your response may be used as evidence against you in court. It is best to avoid such circumstances which can be easily done with the support of a good and reliable lawyer.
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