Case of the week: When can the ‘without prejudice’ rule be set aside?

In Brunel University & Schwartz v Webster & Vaseghi, the Court of Appeal analysed the ‘without prejudice’ rule and circumstances in which the rule can be set aside.

The without prejudice privilege attaches to evidence of settlement negotiations aimed at resolving disputes, and prevents such evidence being referred to in proceedings. However, privilege will fall away where both parties waive it, and can also be withdrawn where it would otherwise conceal unlawful behaviour.

Facts

Vaseghi and Webster brought claims of race discrimination against Brunel University. The without prejudice discussions to settle the disputes were unsuccessful and tribunal hearings went ahead. Subsequently, in a university newsletter, the vice-chancellor complained about the cost of defending the claims, and alluded to the fact that the claims had been accompanied by “unwarranted demands for money”. Vaseghi and Webster brought victimisation grievances and tribunal claims on the basis of these comments. An independent panel set up by the university heard the grievances, including evidence about the without prejudice discussions.

The tribunal pleadings and bundle also contained various references to the settlement discussions. However, when Vaseghi and Webster disclosed a statement by a solicitor about these discussions, the university’s lawyers objected on the basis that the evidence was without prejudice.

Decision

The Court of Appeal said that privilege had been waived on the basis that both parties:



  • Gave or called evidence of the without prejudice discussions at the independent panel review (an unusual forum as it was adversarial in nature and a formal trial)

  • Referred to the without prejudice discussions in their respective pleadings.

However, the court said that, in normal cases where without prejudice discussions are mentioned at internal grievance meetings, privilege would not be waived.

While the court declined to comment on whether there was an exception to the without prejudice rule in cases of discrimination to prevent the rule from concealing the “evil” of discrimination, it did say that it could understand that it may be difficult to prove discrimination if the general without prejudice rule applies fully in every case.

Key implications

Be aware that without prejudice protection will not apply in all cases and is not absolute. To protect the without prejudice status of communications:



  • Consider whether there is a dispute before speaking on a without prejudice basis. The rule only applies where there is a dispute between the parties and the discussions are a genuine attempt to end the dispute.

  • Label settlement documents ‘without prejudice’, although remember that a document will not become privileged merely because of its label.

  • Only refer to without prejudice communications during internal grievance proceedings where absolutely necessary, and make it clear that privilege is not being waived. Where independent panels are set up to determine grievances, beware that adducing evidence of without prejudice communications is likely to waive privilege.

  • Do not refer to without prejudice documents or discussions in pleadings, witness statements or any other tribunal documents.

  • The privilege may not cover communications that disclose evidence of discrimination. There remains a risk that the without prejudice rule will be set aside to allow a claimant to prove discrimination.

By Judith Harris, professional support lawyer, Addleshaw Goddard

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