Some legal terms of art trickle down from the lofty arenas of legal disputes to the public roads and streets, where they are thoroughly conflated, confused, and corrupted by the general public, who know just enough to get them completely wrong and perpetuate the error.

A common one for which there is widespread abuse is the phrase without prejudice. There is a notion that whatever we say or write after that phrase will not bind us. It won’t count when without prejudice is raised. Or we can pull back from it. Whatever the case, it’s an abracadabra for not committing to something. After a while, nobody even remembers why it is there, but since it’s probably a legal thing, best just keep it there.

The worst of it is when the phrase is inappropriately used in correspondence or discussions by the legally educated or lawyers, who should know better. I have seen some use the phrase indiscriminately, thinking about it like a layperson would. That just should not happen with lawyers. Knowing how without prejudice works is part of the basic structure of any lawyer. It’s a necessary brick in a lawyer’s foundation of legal knowledge.

The leading case about it remains the Federal Court decision of Malayan Banking Berhad v Foo See Moi [1981] 2 MLJ 17.

It is settled law that letters written without prejudice are inadmissible in evidence of the negotiations attempted. This is in order not to fetter but to enlarge the scope of the negotiations, so that a solution acceptable to both sides can be more easily reached. But it is also settled law that where the negotiations conducted without prejudice lead to a settlement, then the letters become admissible in evidence of the terms of the agreement, unless of course the agreement has become incorporated in another document which would then be the evidence of the agreement.

Chang Min Tat FJ, Malayan Banking Berhad v Foo See Moi [1981] 2 MLJ 17

Without prejudice is relevant within the context of negotiations to settle a dispute between parties. The court will not consider correspondence exchanged during negotiations of a settlement marked without prejudice. The court takes this position to encourage parties to settle amicably with each other. Privileging such documents enables the disputing parties to negotiate freely. They do not have to fear being held in court to an admission or concession made during negotiations to facilitate a settlement.

But just because a correspondence is marked without prejudice does not automatically make it a privileged communication: see Wong Nget Thau & Anor v Tay Choo Foo [1994] 4 CLJ 617, HC. The court would consider the correspondence and their context to decide if a communication is privileged.

Two elements must be present for privilege to attach to a without prejudice communication. The first is the existence of a dispute which led the parties to negotiate a settlement. The second is the communication contains proposed terms toward a settlement: see Dusun Desaru Sdn Bhd v Wong Ah Yu [1999] 2 CLJ 749, HC. If these two elements are present, those communications are privileged.

But just because a correspondence is not marked without prejudice does not necessarily mean it is not a privileged communication. So long as a communication takes place within a settlement negotiation, it is privileged whether or not the correspondence or the communications are marked without prejudice: Rush & Tompkins Ltd v Greater London Council [1989] 1 AC 1280, HL.

The ‘without prejudice’ rule applies to exclude all negotiations genuinely aimed at settlement whether oral or in writing from being given in evidence. A competent solicitor will always head any negotiating correspondence ‘without prejudice’ to make clear beyond doubt that in the event of the negotiations being unsuccessful they are not to be referred to at the subsequent trial.

However, the application of the rule is not dependent upon the use of the phrase ‘without prejudice’ and if it is clear from the surrounding circumstances that the parties were seeking to compromise the action, evidence of the content of those negotiations will, as a general rule, not be admissible at the trial and cannot be used to establish an admission or partial admission.

Lord Griffiths, Rush & Tompkins Ltd v Greater London Council [1989] 1 AC 1280

The privilege over without prejudice communications end when there is a settlement between the parties. If there is later a dispute about the settlement, the court will determine whether those communications resulted in a settlement, and if so, what the settlement was. If no settlement was reached, without prejudice communications remain privileged. The court will deny attempts to introduce privileged communications as evidence.

The primary relevance of the legal phrase without prejudice relates to the settlement negotiations, not all and sundry. If a communication lacks those two elements for privilege to apply, it may be admitted as evidence (provided it is relevant). Similarly, the court might admit them if the negotiations were not genuine, either on the part of one party or in collusion with others.

The law on this has little changed since 1981, 44 years ago. And even then, as Chang Min Tat FJ remarked it was already settled law. It is ironic that misconceptions about without prejudice still remain in the public despite the law remaining settled for a long time. It is tragic that there are lawyers as ignorant as the public.

The prejudice about without prejudice looks set to remain as unchanged as the law on this issue. This state of affairs recalls the Lindy effect, which proposes that the longer something exists, the longer it is likely to continue to exist. This applies to ideas or concepts, including prejudice and without prejudice and, perhaps, a touch of pride. Like that timeless rojak recipe which no one dares to alter—without prejudice misconceptions seem destined to remain on the menu of legal misunderstandings, perpetually ‘settled’ yet strangely never settling down.