FIDIC / Legal Reference: General legal principle
A label applied to communications made in the course of genuine settlement negotiations, indicating that the content cannot be used as evidence of liability or admissions in subsequent legal proceedings. The Without Prejudice rule protects the parties’ freedom to negotiate openly.
What it means in practice
The Without Prejudice rule protects statements made in genuine settlement negotiations. A document marked ‘Without Prejudice’ is not automatically protected — the label alone is insufficient if the communication is not a genuine attempt to settle a dispute.
In construction disputes, Without Prejudice correspondence is common during the amicable settlement period, during mediation, and in the run-up to arbitration hearings. The protection enables the parties to make commercial concessions without those concessions being treated as admissions in the arbitration.
Where disputes arise
Misuse of the Without Prejudice label — applying it to routine project correspondence in the hope of protecting it from disclosure — is a recognised problem in construction disputes. Marking a letter ‘Without Prejudice’ does not protect it if it was not a genuine settlement offer.
UAE Context
UAE law recognises the concept of confidential settlement negotiations, though the technical rules differ from English law. Parties in UAE construction disputes should seek legal advice on the scope of protection available.
Related terms
e-Basel advises contractors and employers on dispute strategy and settlement negotiations across UAE construction disputes.
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