Without Prejudice Letters: Settlement Correspondence (2026 Guide)

In short: A without prejudice letter is settlement correspondence that, under the common-law rule of evidence, stays inadmissible at trial provided a genuine dispute already exists and the letter is a real attempt to resolve it. Add “save as to costs” for a Calderbank offer that the judge can see only on costs after judgment. eLitigant drafts your without prejudice letter from your own facts — or checks the draft you’ve written.

A without prejudice letter is the single most misunderstood piece of paper in English litigation. People stamp the words at the top of an email and assume a magic shield has descended. It has not. Without prejudice is a rule of evidence, not a rule of manners — and it protects only what genuinely belongs to it. Get it right and you can negotiate freely, test figures, float apologies, and settle without any of it being waved at the judge later. Get it wrong and your careful settlement overture becomes Exhibit A.

What “Without Prejudice” Actually Means

Common-law rule of evidence. Communications — spoken or written — made in a genuine attempt to settle an existing dispute are inadmissible as evidence if case later goes to trial. Public policy: courts want parties to talk freely, concede without consequence, explore compromise.

Leading authorities: Rush & Tompkins v GLC [1989] AC 1280 — covers whole negotiation, not just numbers. Unilever v Procter & Gamble [2000] 1 WLR 2436 — list of exceptions. Oceanbulk Shipping v TMT [2010] UKSC 44 — “interpretation” exception. Muller v Linsley & Mortimer [1996] 1 PNLR 74 — facts-in-issue exception.

When the Rule Applies

Two conditions both satisfied: (1) actual dispute must already exist — real disagreement on identifiable issue; (2) communication must be genuine attempt to resolve.

Courts look at substance, not label. A letter marked “without prejudice” containing no settlement content unlikely to attract privilege. An unmarked letter plainly a settlement overture during negotiations may still be privileged. Label helps — not decisive.

How to Label the Letter

“WITHOUT PREJUDICE” in bold capitals at top. For Calderbank: “WITHOUT PREJUDICE SAVE AS TO COSTS”. Do not mix labels on same letter.

Email: subject line + body. Phone: open with “I am speaking to you on a without prejudice basis” and confirm in writing after.

Calderbank Offers (WP Save as to Costs)

From Calderbank v Calderbank [1976] Fam 93. Inadmissible on substantive issues but shown to judge on costs after judgment. Purpose: put other side at costs risk. Offer £20,000, they refuse, court awards £15,000 — show the letter and argue they should have accepted.

Main tool in jurisdictions where CPR Part 36 does not operate — family, certain tribunals. In CPR civil claims, Part 36 offers are primary costs-shifting mechanism with sharper teeth. Calderbank still useful — judges retain costs discretion.

Section 111A ERA 1996 — Protected Conversations

Employment variant. Pre-termination negotiations inadmissible in unfair dismissal claims, even without prior dispute. Key difference: without prejudice needs dispute; s.111A does not.

Limits: covers unfair dismissal only — not discrimination, whistleblowing, breach of contract. Lost where “improper behaviour” — pressure, threats, discrimination during the conversation.

When Privilege Does Not Apply

Unilever exceptions:

• Dispute over whether settlement was concluded
• Evidence of threat, blackmail, or “unambiguous impropriety”
• Interpreting a resulting settlement (Oceanbulk)
• Showing misrepresentation, fraud, or perjury in negotiations
• Necessary to prevent estoppel
• So central that exclusion would defeat justice (narrow)
• Parties agree to waive privilege

When You Cannot Mark “Without Prejudice”

• No existing dispute — initial letter before disagreement is open. Your LBA must be on the record.
• Part 36 offers — own statutory regime. Marking WP may invalidate.
• Case management correspondence — not settlement overtures.
• Disclosable documents — cannot hide a contract by WP cover.

How to Write the Letter

1. Confirm live dispute
2. Choose label — pure WP or WP save as to costs (never both)
3. Open with context — state WP basis, attempt to settle
4. State offer plainly — number, terms, deadline, mechanism
5. Calibrate tone — factual, not rhetorical
6. Set deadline — 14 or 21 days typical
7. Close with openness — invite counter-offer

Strategy

Timing: early cheaper (saves costs), late informed. Level: what the case is realistically worth discounted for risk. Anchoring: first figure shapes range but must be defensible. Courts notice reasonableness.

The Rules That Apply

• Common law (judge-made) — primary source
• CPR Part 36 — costs-shifting in civil; overlaps with Calderbank
• ERA 1996 s.111A — protected conversations
• Civil Evidence Act 1995 — admissibility framework
• FPR Part 28 — costs in family, where Calderbank remains primary

Common Mistakes

• Treating label as magic
• Mixing open and WP in one letter — send two
• Writing Part 36 offer marked “without prejudice”
• Threatening conduct = “unambiguous impropriety”
• Forgetting costs sign-off — say Calderbank expressly if that’s what you want
• Admitting things you would not admit openly
• No deadline — gives other side unwanted optionality

How Chris Can Help

Good WP letter is a careful piece of drafting. Frank enough to settle, guarded enough not to concede, labelled correctly, calibrated on number and deadline. Chris drafts to elite drafting standards — picking the right label, pitching the right figure, framing the right tone.

Single settlement letter: Express Document. Sustained negotiation across rounds: Express Case. High-stakes commercial/matrimonial drafting: Draft my papers →.

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FAQ

Can I write “without prejudice” on any letter?

No. Must relate to existing dispute and be genuine settlement attempt. Otherwise label has no effect.

Difference between WP and WP save as to costs?

Pure WP: inadmissible for all purposes. Save as to costs (Calderbank): inadmissible on substantive issues but shown on costs after judgment.

Is Part 36 offer a WP offer?

No. Part 36 is statutory regime under CPR with its own formalities. Marking WP can invalidate it.

Can WP material ever be shown to court?

Yes, in Unilever exceptions — concluded settlement disputes, unambiguous impropriety, interpretation (Oceanbulk), facts-in-issue (Muller).

Does WP apply to spoken conversations?

Yes. All communications if conditions met. Open call: “I am speaking on a without prejudice basis” + confirm in writing.

s.111A protected conversation?

Pre-termination negotiation in employment. Inadmissible in unfair dismissal even without prior dispute, provided no improper behaviour.

Use WP in letter before action?

No. LBA is open letter on record, required by pre-action protocols.

How long for response?

14 or 21 days typical. Shorter where urgency justified. For Calderbank: deadline is date from which costs risk attaches.

Frequently asked questions

Can I write “without prejudice” on any letter?

No. The words only have effect where a genuine dispute already exists and the letter is a real attempt to settle it. Courts look at the substance, not the label, so stamping the phrase on an opening letter before any disagreement has no protective effect.

What is the difference between “without prejudice” and “without prejudice save as to costs”?

Pure without prejudice is inadmissible for all purposes. “Save as to costs” — a Calderbank offer — stays inadmissible on the substantive issues but can be shown to the judge on costs after judgment, putting the other side at costs risk if they refused a reasonable offer. Never mix the two labels on the same letter.

When should I NOT mark a letter “without prejudice”?

Where there is no existing dispute (your letter before action must be on the record), for Part 36 offers (which have their own statutory regime), for routine case-management correspondence, and for documents that are independently disclosable — you cannot hide a contract behind a without prejudice cover.

What is a Calderbank offer?

It is a “without prejudice save as to costs” offer, named after the family case it comes from. It is the main costs-shifting tool in arenas where CPR Part 36 does not operate, such as family proceedings and certain tribunals, and remains useful elsewhere because judges retain a discretion over costs.

Does the protection ever fall away?

Yes. Recognised exceptions include disputes over whether a settlement was actually concluded, evidence of threats or unambiguous impropriety, interpreting a resulting settlement, showing misrepresentation or fraud in negotiations, preventing an estoppel, and where the parties agree to waive privilege.

How does the employment “protected conversation” differ?

Section 111A of the Employment Rights Act 1996 makes pre-termination negotiations inadmissible in an ordinary unfair dismissal claim even without a prior dispute. It is narrower in scope — it does not cover discrimination, whistleblowing or breach of contract, and is lost where there is improper behaviour during the conversation.

Related guides: Letter before action · Form N1 claim form · All civil court forms