"Without prejudice" is one of the most misused phrases in everyday legal correspondence. Writing it on a letter does not automatically protect you. Understanding what it actually does — and when it does not apply — matters before you use it.

What "without prejudice" means

The without prejudice rule is a rule of evidence. It prevents a court from seeing communications made in a genuine attempt to settle a dispute. The purpose is to encourage parties to negotiate freely, without fear that a concession or offer will later be used against them if negotiations break down. The rule derives from the decision in Cutts v Head [1984] Ch 290 and is confirmed in rule 36 of the Civil Procedure Rules.

When it does NOT apply

Simply writing "without prejudice" on any letter does not trigger the protection. The rule only applies where: (1) there is an existing dispute, and (2) the communication is a genuine attempt to settle it. A letter asserting your position for the first time, threatening litigation, or making a demand is not an attempt to settle — labelling it "without prejudice" has no legal effect. Courts will look at the substance, not the label.

"Without prejudice save as to costs"

This phrase, common in formal offers, means the letter is protected during the main case but can be shown to the court when it decides who should pay costs at the end. This is the basis of a formal Part 36 offer. If you beat the offer at trial, costs consequences follow automatically.

When to use it correctly

Use "without prejudice" — or better, "without prejudice save as to costs" — when you are making a genuine settlement offer in an ongoing dispute and you want to negotiate freely. If in doubt, consult a solicitor before writing it. The Citizens Advice guide to taking a case to court explains how settlement offers work in practice.