What does “without prejudice & subject to contract” mean?

October 14, 2021

You will often see this heading written on the top of settlement agreements or correspondence relating to negotiations or an offer of a settlement.

a) Without Prejudice

Generally, statements made in an attempt to settle a dispute are “without prejudice”, which means that they cannot be put before a court or tribunal as evidence against either party. 

In essence, it means that the communication is being made “off the record”, allowing the parties to negotiate behind a veil of confidentiality. 

The idea behind this is to allow free discussion to settle a claim without fear that any admissions or concessions made in that discussion could later be used against the parties in court if negotiations break down and a settlement is not concluded. 

The parties need to remember that just marking communications “without prejudice” does not automatically give a communication that protection.

There needs to be a dispute in existence, and the communication must be a genuine attempt to settle that dispute. 

b) Subject to Contract

The wording “subject to contract” means that the parties wish to remain uncommitted until a formal agreement has been finalised and all terms are known and signed off. 

Julian Taylor
Julian Taylor is a qualified solicitor and the founder of JulianTaylorHR, a boutique employment law solicitors firm based in Oxford. Specialising in employment law, Julian has helped countless employees and employers throughout their settlement agreement process.
Julian Taylor

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This website contains a summary of various aspects of employment law. It is not intended to provide legal advice for specific cases. No liability is accepted for reliance on any of the information on this website. If advice is required please contact the firm. Settlement Agreements UK is the trading name of Julian Taylor Solicitors Limited, a company registered in England and Wales with registration number 7171586. Julian Taylor Solicitors Limited is recognised and regulated by the Solicitors Regulation Authority and all of its directors and members are solicitors of England and Wales.

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