Rochester Resources Ltd & Ors v Lebedev & Anor

Without prejudice privilege is governed by English law when admissibility is decided in English proceedings. Foreign law may explain the context or meaning of a foreign-law reference, but it does not determine privilege or public policy. An opening communication can attract privilege even where no previous negotiations exist. The question is whether, viewed objectively, the communication was part of negotiations genuinely aimed at settlement. A draft pleading sent before proceedings may be privileged where its substance, accompanying communications and express description show that it was a preliminary negotiating document. The absence of a specific offer or concession is not decisive. Inconsistency between privileged negotiations and a later case does not itself justify admission; the exception for unambiguous impropriety was not relied upon.

The first defendant applied to exclude a preliminary New York complaint and related communications from evidence in support of the claimants’ application for an anti-suit injunction. The claimants wished to rely on the draft because they said it materially contradicted the complaint later issued in New York.

The claimants also sought permission to adduce expert evidence of New York law. The central issues were whether New York law was relevant to admissibility, whether the documents attracted without prejudice privilege under English law, and whether the application to adduce expert evidence was too late.

1. Expert evidence of New York law. The court refused permission under CPR 35.1. Admissibility in English proceedings was governed by English law as the lex fori. New York law was relevant only to explain the references to CPLR and Federal Rules provisions in the document’s legend; their meaning was agreed and required no expert evidence. Public policy was likewise determined by English law. The position might have differed if a New York court had ruled that the document was not privileged and it had entered the public domain, but that had not occurred.
2. Inconsistency. The alleged inconsistency between the draft and the later complaint did not, without more, defeat privilege. The claimants did not rely on the exception for unambiguous impropriety.
3. Opening shot. A first communication in settlement discussions can be privileged, but protection depends on the substance of the communication and all the circumstances. The communications of 6 and 8 March 2013 were considered together. The draft complaint, its settlement legend and the covering letter showed objectively that it was sent in advance of litigation to provide an opportunity for settlement. It was therefore a preliminary negotiating document, not a letter before action.
4. The absence of a specific offer or concession did not prevent privilege. The draft complaint and its transmission were documents created as part of negotiations genuinely aimed at settlement and fell within without prejudice privilege under English law.
5. The application to adduce the expert evidence was also refused because it was made late and the court could not realistically resolve the conflicting expert opinions on the papers after the hearing.