There is a basic principle in Common Law in the UK that a client should be able to consult a legal professional in confidence without fear of having to disclose verbal or written communications between them at a later date to a third party or the court. It can also be used to deny regulators and enforcement agencies access to documents. In other words, it protects the confidentiality of the lawyer/client relationship.
Legal Privilege
‘Legal privilege’ protects all communications – written and verbal – between a professional legal adviser – mediator, solicitor, barrister – and their clients from being disclosed without the permission of the client. ‘Privilege’ applies to the client, not the professional.
The purpose behind ‘legal privilege’ is to protect an individual, and encourage complete disclosure to their legal advisor without fear that any disclosure of those communications may prejudice the client in the future, for example, by being disclosed in court.
Without Prejudice
The ‘Without Prejudice’ rule is to encourage settlement discussions without parties weakening their position in a formal dispute, ie. similar to ‘legal privilege’, people can communicate openly – written and verbal – without fear that what they are saying may be used against them in court or arbitration. ‘Without Prejudice’ effectively means that ‘while I am trying to reach a settlement with you, I am not admitting any part of the case or conceding or waiving any arguments or rights, so my offers to achieve a deal or settlement are without prejudice to my primary position that I am right and you are wrong’.
There are only a few exceptions when ‘Without Prejudice’ material may be used, primarily where the material evidences fraud, undue influence, perjury, misrepresentation or blackmail, etc.