But privileges only arise when there is a real issue between the parties and the letter (or discussion) is a genuine attempt to resolve it. In Avonwick Holdings Limited/Webinvest Limited (2014), the Tribunal found that the title “without prejudice” had no effect, since there was no litigation or evidence of an agreement at the time of existence, that the terms would not be used in court. So why bother to attract “without prejudice”? Confidential interactions (written and oral) between parties who actually attempt to resolve a dispute are often referred to as “unprejudiced” (WP). It is practically an acronym for the statement: “While I am trying to reach an agreement with you, I am not admitting part of the case or granting any argument or right, or I am waiving that – so my offers to find a commercial case, without prejudice to my primary position, is that I am right and that you are wrong.” “… as a general rule, the unprejudiced rule in a subsequent dispute over the same object renders inadmissible evidence of confessions made in the context of a genuine attempt at agreement. It goes without saying that an agreement with another party in the same dispute is also inadmissible, whether or not a transaction has been concluded with that party. This means that there is an element of protection for the parties to the dispute when they open discussions on an unprejudiced basis. (It is also called “protection against prejudice” or “without prejudice.”) All discussions conducted under the guise of this protection or privilege are confidential between the parties. “contractual obligation” is used to mean that an agreement is not yet binding. A document called “in accordance with the contract” is not subject, in operation, to unprotected protection. In cases where you are in negotiations and therefore you want unprejudiced protected protection, but your transaction offer is further discussed rather than being totally binding on adoption, you should also guide the letter “in accordance with the contract.” This makes it clear to the other party that any regime proposed or discussed still depends on the development of formal, written and agreed terms.
But these two labels achieve completely different things and should not be confused. Without prejudice to protection, protection is generally accepted to be extended to all disputes, whether litigation, arbitration, judicial proceedings5 or out-of-court litigation settlement (ADR).