The WP rule is to encourage settlement talks without the parties weakening their position in the formal dispute. Basically, when this rule applies, people can speak and write openly without fear that what they say could be used against them in court or arbitration. Impartial is a term used in offers made for the purpose of negotiating a settlement or compromise. It is a convenient abbreviation for “without prejudice to my/our rights” and is used to protect against any argument from those with whom there is an argument that a concession offered in negotiations constitutes a waiver of a right or an admission of responsibility in legal proceedings. Without prejudice, the clauses are most often used in settlement talks in the Commonwealth countries of the United Kingdom. However, they are still found in some U.S. treaties. An example of a no-prejudice clause is that the purpose of the harm rule is to encourage the parties to the dispute to reach an agreement by allowing them and their legal advisers to speak freely and make concessions, knowing that their words can no longer be used against them in court if negotiations do not lead to a settlement. However, protection is not absolute and there are exceptions.
The rule without prejudice is a common protection. This means that only by all parties to the communication concerned can it be waived together without prejudice. An impartial clause in a contract ensures that each contracting party retains its legal rights and privileges.3 min read Therefore, it is clear that the breach rule only applies to discussions that take place with a view to reaching an agreement and therefore does not include general case management discussions. It is important to remember this in order to avoid an informal admission or recognition of a fact in an open and unbiased forum. In short, you shouldn`t say something is “without prejudice” if you want to rely on it in court or any other type of court case. As a basic guideline, this means that you should not use the phrase in a communication that is not part of a comparative discussion or comparison. Anyway, the term “subject” is similar, which is also often used in legal contracts. The main difference between the two is that it is usually used in a superseded clause while the current clauses are submitted. In this sense, here are some examples of cases where “without prejudice” should not be used: A communication (written or oral1) must be made in the context of meaningful settlement negotiations in order to be “without prejudice”. A simple marking of a document “without prejudice” is not enough.
The circumstances must be taken into account in deciding whether protection is applicable. “Without prejudice to any label which may be used indiscriminately to exempt an act from its normal legal consequences in the absence of a genuine dispute or negotiation”.2 The expression “object of the contract” is used to indicate that an agreement is not yet binding. A document marked “subject matter of the contract” is generally not protected. In cases where you are in negotiation and therefore want impartial protection, but want your settlement offer to be further discussed rather than being fully binding upon acceptance, you must also replace the letter “contractual purpose”. This makes it clear to the other party that any proposed or discussed settlement is always subject to formal, written and agreed terms. But these two labels do completely different things and should not be confused. However, the courts treat the impartial veil with some respect, and what has been clarified in recent Court of Appeal decisions12 indicates that “manifest inadequacy” must be demonstrated in order to be lifted. This is behaviour that is somehow “oppressive, dishonest or dishonourable”.13 Courts recognize that, in practice, negotiations often involve a certain degree of posturing and accept that a party may take a position in discussions without prejudice incompatible with its open position. However, there is a line that must be drawn, and the use of the unbiased label does not give a party “carte blanche” to be dishonest.