The phrase “without prejudice” is commonly overused and misunderstood. When using the phrase, people should be mindful that simply labelling communication “without prejudice” does not automatically guarantee the privilege. Rather, the surrounding circumstances and the content of the communication will be taken into consideration when determining whether the privilege applies.
Section 131(1) of the Evidence Act 2008 provides that any communication between any parties to a dispute that occurs during negotiation, or any document prepared in connection with the negotiation, cannot be adduced as evidence in court. This confirms that the “without prejudice” privilege is established not simply by the inclusion of the words “without prejudice”, but rather by the parties intentions which are to be ascertained from the nature of the communication.
Similarly, if the communication is labelled “without prejudice” but its content does not reflect a genuine attempt at settlement, the privilege may not apply. There are also numerous exceptions to the “without prejudice” privilege outlined in the Act. The misuse of the privilege can result in potential cost implications and legal argument.
Anyone seeking to rely on the “without prejudice” privilege should always give consideration to the content and purpose of the communication that they wish the privilege to attach to.
If you have any further questions, or for further information, please contact:
03 9611 0148