This is a phrase which can be used to safeguard correspondence in which provisional
offers are made which are tentative, and which may need to be withdrawn
later depending upon how negotiations proceed. In this way they differ
from any ‘subject to contract’
offer which remains on the record, although neither party is committed
by such negotiation. ‘Without prejudice’ offers are probing
suggestions for matters yet to be settled during the ongoing negotiation.
If they are later withdrawn they may not be quoted in future negotiations
nor used as evidence in any court proceedings.
The phrase is used more particularly in tenancy negotiations, regarding future rent levels, etc., although it can arise in leasehold negotiations with the landlord, or whoever has to give consent to any assignment.
There are also a few circumstances when the use of ‘Without Prejudice’ can adversely affect the position, for example, where any formal notice required to comply with the specified time-table would not be legally valid, if it were only made in ‘without prejudice’ correspondence.