THE ADMISSIBILITY OF WITHOUT PREJUDICE DOCUMENTS UNDER THE DELAY/ACQUIESCENCE EXCEPTION OF THE BROAD APPROACH
The term “without prejudice” is commonly used in the course of settlement negotiations, but what does it really mean in law? Does it really mean that everything discussed can never be disclosed?
Broad approach. In CSO v CSP and another [2023] SGHC 24, Andre Maniam J held that we adopt the common law approach to “without prejudice” privilege (the “Broad Approach”), which protects the whole of such communications and not just admissions (at [4] – [6]).
And Section 23(1) of the Evidence Act 1893 (2020 Rev Ed) (the “Evidence Act”), which only protects “without prejudice” admissions (at [3]), does not oust the Broad Approach (at [5]).
“Admissions in civil cases when relevant
23.—(1) In civil cases, no admission is relevant if it is made —
(a) upon an express condition that evidence of it is not to be given; or
(b) upon circumstances from which the court can infer that the parties agreed together that evidence of it should not be given.”
However, as this case will show, this Broad Approach is subject to exceptions.
Brief facts. In this case, the plaintiff filed an action for an injunction to, among others, restrain the second defendant bank from paying on the guarantee and the first defendant from receiving payment (at [11]).
The plaintiff made two assertions (the “plaintiff’s Assertions”) in its supporting affidavit (at [12] – [13]):
(a) that the first defendant did not take any steps to extend a letter of credit (“LC”) (the “first Assertion”); and
(b) that the first defendant did not take issue with the retention money being returned to the plaintiff (the “second Assertion”).
It suffices to say that the first defendant filed an affidavit to respond to the plaintiff’s Assertions (at [15]). In doing so, the first defendant referred to five emails (the “Disputed Emails”) (at [17]).
The plaintiff then sought to strike out these Disputed Emails on the basis that they were covered by “without prejudice” privilege (at [18]).
The plaintiff’s application failed both at first instance and on appeal before Andre Maniam J (at [19] – [20]).
The decision. In essence, Andre Maniam J decided that (at [20]):
The first defendant was entitled to put portions of the Disputed Emails into evidence to rebut the plaintiff’s Assertions.
While these portions were covered by “without prejudice” privilege, the first defendant was entitled to rely on a “Delay/Acquiescence Exception” to “explain delay or apparent acquiescence”.
Andre Maniam J also limited the portions of the Disputed Emails that the first defendant can refer to (at [21]).
In this article, we focus on the Delay/Acquiescence Exception.
However, readers are encouraged to read the full judgment for the reasoning of why the Broad Approach is the position in Singapore.
The Delay/Acquiescence Exception. So, what is the Delay / Acquiescence Exception? Andre Maniam J laid out the scope of this exception at [28] – [30] as excerpted below.
“28 The Delay/Acquiescence Exception was stated by Walker LJ in Unilever at 2444–2445: that a party could refer to “without prejudice” communications “to explain delay or apparent acquiescence”. In this regard, I considered that the concept of “delay” included not only belated action, but also complete inaction: here, the non-extension of the LC, which the plaintiff alleged to be due to the first defendant not taking any steps to extend it.
29 Those pages of Walker LJ’s judgment in Unilever were cited by the Court of Appeal in Nicky Quek at [23] as setting out “the most important instances” of the exceptions to “without prejudice” privilege.
30 Walker LJ noted that in Walker v Wilsher (1889) 23 QBD 335, Lindley LJ (at 338) had regarded the Delay/Acquiescence Exception as limited in its effect, as excepting the fact and dates of negotiations from being privileged. However, Walker LJ doubted the generality of this proposition, commenting that “occasionally, fuller evidence is needed in order to give the court a fair picture of the rights and wrongs of the delay”. The Court of Appeal in Nicky Quek accepted the exceptions as formulated by Walker LJ in Unilever.”
This broader formulation in Unilever hence excepted not just the fact and dates of negotiations from being privileged, but also the contents of such negotiations if it is necessary to give the court “a fair picture”.
The plaintiff tried to rely on the case of Soon Peng Yam and another (trustees of the Chinese Swimming Club) v Maimon bte Ahmad [1995] 1 SLR(R) 279 (“Soon Peng Yam”) to say that a narrower formulation should apply (at [31]).
However, this was rejected by Andre Maniam J, who stated that (at [31] – [32]):
In Soon Peng Yam, the court agreed that the appellants could adduce certain “without prejudice” letters for the mere fact that negotiations had taken place;
Whether the contents of the “without prejudice” negotiations were admissible was not in issue; and
That decision “predates the formulation of the exceptions in Unilever and the endorsement of that formulation in Nicky Quek”.
Application. Returning to the present case, while the first defendant “could minimally rely on the narrow form of the Delay/Acquiescence Exception” to say that in the relevant period there were “without prejudice” negotiations taking place, Andre Maniam J found that the broader form of the exception applied as “[t]his was … a case where (as Walker LJ put it in Unilever) fuller evidence was needed to give the court a fair picture of the rights and wrongs of the delay (or inaction, I would add).” (at [33] – [34])
This is because, among others, the plaintiff had, by its first Assertion (at [36]):
“… put in issue the reason for the LC not being extended (ie, the rights and wrongs of the delay/inaction), [so] the first defendant should be allowed to respond by showing that in the course of “without prejudice” negotiations it had proposed to extend the LC, but the plaintiff had opposed that extension, and that is why the LC was not extended. If the first defendant were limited to referring to the dates and fact of negotiations about payments, the court would not have a fair picture of why the LC had not been extended.”
(emphasis in original)
Andre Maniam J stated that in a similar case, the court in McFadden v Snow (1952) 69 WN (NSW) 8 (followed in Pitts v Adney [1961] NSWR 535 at 539) admitted a letter (and its contents) into evidence to “negative the inference that otherwise might quite erroneously have been raised in [the] claimant’s favour” as the court “refused to allow “the cloak of ‘without prejudice’” to be “abused for the purpose of misleading the court” (at [37] – [38]).
Andre Maniam J also noted that allowing the contents of the Disputed Emails to be put in evidence “would not offend the public policy underlying the “without prejudice” principle” as the communications would be “relevant for the mere fact that they were made, and not because of the truth of what was stated” (at [39] – [41]).
Hence, ultimately, Andre Maniam J found that “the first defendant should be allowed to rely on the fact, dates and contents of the Disputed Emails”, limited to the Relevant Portions (at [45]; emphasis in original).
Significance. An important basis of the “without prejudice” privilege under the common law is the policy of encouraging settlements.
Hence, protecting the whole of “without prejudice” communications, as opposed to merely admissions against interest, would encourage settlements.
However, there are exceptions, such as the Delay/Acquiescence Exception.
So, what does this mean?
This means you should still be careful about what you say in without prejudice communications.
If, for example, you tell the other party that they do not need to carry out a certain obligation by a certain date in without prejudice communications, and then turn around and claim that the other party was for no good reason in delay for not carrying out the said obligation by that date in court proceedings, your without prejudice communications may not be fully “immune” from disclosure to the court.
This publication is not intended to be, nor should it be taken as, legal advice; it is not a substitute for specific legal advice for specific circumstances. You should not take, nor refrain from taking, actions based on this publication. Chancery Law Corporation is not responsible for, and does not accept any responsibility for, any loss or damage that may arise from any reliance based on this publication.