The ‘without prejudice’ privilege refers to the inadmissibility of any party communications targeted toward settlement. The objective of this privilege is to encourage parties engaging in settlement consideration, by ensuring any information disclosed in the pursuit of settlement cannot be submitted in litigation proceedings (see Lord Griffiths in Rush & Tomkins v GLC [1989] 1 AC 1280).

The application of the without prejudice privilege came into question in the recent Court of Appeal case of Suh & Anor v Mace (UK) Ltd [2016] EWCA Civ 4.

The claimants were commercial tenants of one of the defendant’s properties. In August 2010, the defendant changed the locks of the property and asserted that he was discontinuing the lease. The claimants, a now-estranged couple, commenced proceedings against the defendant for damages for unlawful forfeiture.

The point of contention at the centre of the present appeal regarded the admissibility of two communications between one of the claimants, Mrs Suh, a litigant in person, and the defendant’s solicitor, Ms Jackson. These communications took the form of two separate meetings between the two parties at Jackson’s office.

During the first meeting, Jackson alleged that Suh conceded that there was unpaid rent at the time of the defendant’s forfeiture of the lease, that she had not signed certain court documents that bore her signature, and that she wished to remove herself from the proceedings. As a result, the defendant wished to submit as evidence the notes taken during these two meetings and Jackson’s statement about the meetings. The claimants argued that these alleged admissions had not occurred, and requested that Jackson’s statement and the supporting documentation from these meetings not be admitted, as any such communications were covered by without prejudice privilege.

At first instance, the judge determined that the communications did not qualify as settlement discussions. The judge held that the communications in question did not fall within the parameters of without prejudice privilege, allowing them to be submitted as evidence in the case. This decision led to the case being dismissed in favour of the landlord’s counterclaim.

Granting the claimant permission to appeal, Lewison LJ observed that the judge’s decision to waive without prejudice privilege was procedurally unsound. The leading judgment was given by Vos LJ (pictured) with whom Beatson LJ agreed.

The defendant’s counsel submitted that Mrs Suh’s admissions were made prior to her expressed desire to remove herself from the proceedings, so even if this subject commenced a without prejudice discussion, anything discussed beforehand was not privileged. Vos LJ, however, held that ‘the only sensible purpose for such a meeting must have been to seek some kind of solution to the litigation for Suh. That is what a settlement is’.

Vos LJ then noted that attempting, as the defendant’s counsel was, to separate the communication into statements with and statements without privilege contradicted the broad view, as set out by Lord Neuberger in Ofulue v Bossert [2009] 1 AC 990. In this case, Lord Neuberger stressed, with reference to a similar determination by Robert Walker LJ in Unilever Plc v The Procter & Gamble Co [2000] 1 WLR 2436, that it is impractical and undermines the very nature of without prejudice discussions to give certain statements within the without prejudice communications immunity from privilege. As such, Vos LJ decided that the contents of the entire first and second interview, as well as Jackson’s statement and any related correspondence, qualified under without prejudice privilege.

The defendant’s counsel further submitted that Suh was using privilege to cover up dishonesty in her own statement, which would fall under the ‘abuse’ exception to without prejudice privilege outlined in Walker LJ’s judgment in Unilever Plc. However, Vos LJ rejected this claim because there was no evidence that Suh had any understanding of without prejudice privilege or its applicability to her communications, nor was the defendant submitting that she was dishonest within the privileged communications themselves.

Finally, the defendant’s counsel submitted that any privilege that applied to the communications between Suh and Jackson was waived by Suh’s witness statement, which denied the contents of the communications, but did not expressly deny their admissibility; the claimants’ application notice to cancel the hearing that would have determined admissibility of the communications in question; and an email from the claimants saying that they did not wish to engage in a case management hearing, as the documents’ admissibility was for the trial judge to determine.

Vos LJ relied on an assessment of Suh’s conduct, which indicated that she did not know her discussions may have been covered by privilege, and that the events the defendant alleged to constitute a waiver of privilege were made both in ignorance of any potential privilege, and in response to documents from the defendant that made no explicit mention of without prejudice privilege. Allowing the appeal, Vos LJ declared all privileged communications inadmissible.

As this case illustrates, encouraging free communication is paramount in settlement discussions, and as such, save for any legitimate instances of abuse, privilege will be afforded to settlement communications in their entirety. The judgment also establishes that, when there is a question of whether a party has waived without prejudice privilege, the party’s conduct must be considered within the context of the purpose of the privilege. Attempts by a party to circumvent the without prejudice privilege by claiming partial privilege immunity, or to claim the other party has waived this privilege, will be considered subject to these standards.

Masood Ahmed is also a member of the Civil Procedure Rule Committee. Claire Pennells, University of Leicester, assisted in the writing of this article

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