In pre-contract negotiations, the parties often direct correspondence « according to the contract. » Any form of communication between the negotiating parties, whether written correspondence, phone calls or meetings, can be considered « without prejudice. » The legal effect depends on the content of the communication. Public policy encourages genuine attempts by the parties to the dispute to negotiate and resolve their differences. The use of « unprejudiced » allows them to negotiate behind a veil of confidentiality, as these communications are legally privileged and generally not admissible in evidence if negotiations fail and the case is tried. If your employer wants to start negotiations on terminating your contract without notice, they usually invite you to a non-prejudiced meeting or ask a meeting if you can talk without prejudice. This has the same effect as the « unprejudiced » offer, but reserves the right to disclose the offer to the court (or to the arbitrator or expert) when it comes to the issue of costs related to the formal settlement of a dispute, even if that specific offer is not accepted. This type of offer is traditionally used in rent assessments (the Calderbank offer). This is increasingly common in court proceedings where the « general objective » of the new Code of Civil Procedure requires the parties to consider costs at all stages. The Court of Appeal found that the correspondence was permissible because at the time of the exchange of correspondence, no dispute between the parties seeking a settlement had been premeditated. Therefore, the use of the term « unprejudiced » is unnecessary and irrelevant, and the prerogative rule does not apply.
These words may also be used in an offer to jeopardize a claim, i.e. the parties are not bound by the terms of the liquidation until a transaction agreement is entered into. Therefore, labelling a contract meeting prevents the involuntary establishment of a contract or an argument that a contract has been established. The most important conditions for the « no prejudice » of the communication or transaction document are: « Without prejudice to costs » (known as the Calderbank offer), the other party had aroused or encouraged an expectation or belief that it would not withdraw in principle from the agreement, which constitutes an extension of the correspondence « without prejudice ». These cases clearly indicate that the parties should ensure the proper use of « unprejudiced » and « contracted » to avoid unintended and potentially harmful consequences. In Avonwick/Webinvest, the use of « contractual subject » meant that the parties could not agree to extend the rule to correspondence before a non-prejudice dispute. On the other hand, in Bieber/Teathers, the non-use of the « contract » led to the « un prejudiced » negotiation of a binding transaction agreement between the parties. The winner of a procedure is generally entitled to the payment of his costs by the loser. Therefore, the Tribunal`s ability to consider offers « without prejudice, beyond costs » has important implications for the exercise of the Court of Justice`s discretion in awarding costs, as well as on the enforcement of disputes by the parties and their willingness to settle the dispute.