The words ‘without prejudice save as to costs’ (WPSATC) is a phrase often used by parties in settlement discussions. Opposing parties can make a genuine attempt to resolve a case before proceeding to court as a form of alternative dispute resolution.

The use of the ‘without prejudice’ phrase on documents is a rule that oversees the admissibility of evidence. It ensures such correspondence cannot later shown to the court.

Our costs experts have many years of experience dealing with disputes and understand cost implications that can surround the ‘without prejudice’ term. If you are looking for advice on the subject, then please get in touch with our team to find out more how we can help.

What Does Without Prejudice Save as to Costs mean?

‘Without prejudice’ and ‘without prejudice save as to costs’ mean two slightly different things.

“Without Prejudice” is a legal term used to protect communications between parties that are made with a genuine attempt to settle a dispute. This protection means that such communications cannot be used as evidence in court against the party that made them. 

“Without Prejudice” communication can be admissible in court under two conditions.

First, it must be demonstrated that the communication is not actually “Without Prejudice,” even if it is labelled as such.

Second, there are exceptions to the “Without Prejudice” rule, meaning it may not apply in certain situations. These exceptions generally occur when there is little risk of prejudice from the disclosure. Examples include proving a concluded settlement agreement, interpreting the terms of a settlement agreement, showing the late submission of communications, or providing evidence to set aside a settlement agreement due to misrepresentation, fraud, or undue influence.

On the other hand, the term ‘without prejudice save as to costs’ means the courts cannot look at such documents until they have delivered a judgment on the main issue at hand. It is a term often associated with Part 36 Offers.

Documents under ‘without prejudice save as to costs’ helps the courts decide how to award costs once they have ruled on liability.

Correspondence labelled ‘without prejudice save as to costs’ can be accessed by the judge for them to decide how to award costs.

The courts can look back on the correspondence or communication containing negotiations of settlement which can be brought to the court after a decision is handed down.

The unsuccessful party in the case will usually be expected to pay the opposing party’s legal costs and the court may use the evidence labelled “without prejudice save as to costs” to decide on the costs payable.

The court will consider whether the parties made genuine offers to settle. They will also consider any unreasonable actions during settlement communications when making a costs order.

How Does Communication Qualify as Without Prejudice?

For communication between parties to qualify under ‘without prejudice’, there must be evidence that the communication forms part of a genuine attempt to settle outside of court.

Under the term, any labelled correspondence cannot be used in court. This enables the parties to speak freely about the existing dispute to encourage an out of court settlement.

In some instances, ‘without prejudice’ communication does not need to explicitly be marked as such for it to be considered so. This is because ‘without prejudice’ can be heavily implied, but it is strongly recommended to explicitly state the term to save any confusion or cause of discrepancy.

Similarly, marking a document clearly ‘without prejudice’ does not automatically provide it protection from use in court if it is to be found that the correspondence doesn’t make a clear and genuine attempt to settle the dispute at hand.

It is worth noting that solicitors utilise two main types of correspondence, documents marked ‘without prejudice’ which accepts the dispute at hand and attempts to resolve it through negotiation to save time and money, and also ‘open’ letters.

Open letters would primarily be used to discuss liability itself so if it comes to court proceedings, a judge is able to see a party’s argument before making their decision.

If a case progresses to court, the judge also possesses the power and authority to decide if documents are granted the privilege of ‘without prejudice’ and can ultimately decide if any part of a document that doesn’t attempt to negotiate a settlement can be used as evidence.

It is important to note that the without prejudice rule cannot be used for all areas of the law and all cases, as a general rule, prejudice privilege will not apply for the following:

• Commercial negotiations
• Cases in which communication includes illegal, fraudulent or misinterpreted comments
• Communication which is not genuine
• Documents that have already been exchanged with consent
• Where communication clearly states it is not confidential

How Can Greener Costs Assist?

At Greener Costs, our team of Costs Lawyers and Costs Draftsmen have many years of experience surrounding costs drafting and negotiation. If you need any advice surrounding the cost implications surrounding the term ‘without prejudice save as to costs’ then our team can help.

We are able to assist clients from all backgrounds on a range of cases and can help you recover costs from your case as well assist paying or receiving parties with bills of costs and Points of Dispute/Reply.

In addition to our drafting services, at Greener Costs, we are actively doing everything we can to ensure our business benefits the environment. We are doing this though carbon offsetting of our staff, becoming completely paperless and carbon offsetting through each instruction.

If you wish to speak to a member of the team here at Greener Costs about issues of costs, then please contact us at 01204 263047, info@greenercosts.co.uk or use the online form on our website below.