A v B & C (Practice and Procedure : Admissibility of evidence)

Without-prejudice protection depends on the substance and context of communications, not on whether they are labelled “without prejudice” or “off the record”. It applies to a genuine attempt to compromise an existing dispute where litigation was, or might reasonably have been, contemplated if agreement failed.

A future possibility of a dispute is insufficient. Once a party knew that dismissal was not then contemplated, negotiations about leaving employment did not concern an existing dispute capable of compromise merely because later disciplinary proceedings and dismissal might occur. Documents falling outside the rule were admissible, but could be redacted where necessary to prevent disclosure of an earlier protected offer.

The appellant, a teacher, was subject to disciplinary proceedings. While the first proceedings were pending, his union representative and the respondents discussed a possible compromise agreement. The correspondence began with an email marked “without prejudice” and included attendance notes of telephone calls and a later email.

At a case-management hearing, Employment Judge Brooks held that the documents and the recorded discussions were protected by the without-prejudice rule. The teacher appealed. The respondents accepted that the final attendance note should be admissible. The central issue was whether the other communications concerned an existing dispute in respect of which litigation was reasonably contemplated.

1. Appeal allowed. The email of 13 October 2011 remained protected by the without-prejudice rule. The attendance note of 27 October 2011 and the later documents were admissible, subject to redactions preventing disclosure of the protected earlier offer.

2. The rule protects communications made in a genuine attempt to compromise an existing dispute and avoid litigation. Its purpose is to encourage frank settlement negotiations. Labels such as “without prejudice” or “off the record” are not decisive; the court must assess all the circumstances.

3. Following Barnetson v Framlington Group Ltd [2007] ICR 1439, the relevant question is whether the parties contemplated, or might reasonably have contemplated, litigation if negotiations failed. Following Bradford & Bingley Plc v Rashid [2006] 1 WLR 2066, there must also be a real dispute already in existence which is capable of compromise.

4. Before 27 October 2011, it was open to the employment judge to find that the teacher faced a real possibility of dismissal and might reasonably contemplate an unfair-dismissal claim if no compromise were reached. The email of 13 October was therefore protected.

5. From 27 October, the teacher and his advisers knew that dismissal was not then contemplated because the disciplinary outcome was a final written warning. Possible future disciplinary proceedings and a possible future dismissal did not constitute an existing dispute. The subsequent negotiations were therefore not protected.

6. The attendance note of 27 October and the email of 14 November were to be edited so that the tribunal would not learn of the earlier £20,000 offer or its rejection.

• Employment Appeal Tribunal: allowed the appeal against Employment Judge Brooks’s case-management ruling on admissibility, except that the email of 13 October 2011 remained protected.
• Employment Tribunal: Employment Judge Brooks had ruled that the documents and recorded discussions could not be produced or referred to in evidence.