Negotiating A Settlement: Without Prejudice Privilege

All disputes can get messy and landlord and tenant disputes are no different. Where the right to occupy a property is critical, either for business or residential purposes, the stakes are high for both sides. Whatever the strengths and weaknesses of a case, litigation can be stressful and costly and sometimes settling a dispute is the best way forward.

Parties can generally rely on "without prejudice privilege" to carry out full and frank discussions with a view to seeking resolution of a dispute in the knowledge that any admissions made will not be used against them at trial. Determining what constitutes a genuine attempt to settle which attracts without prejudice privilege can be a minefield for qualified lawyers and it can be particularly difficult for litigants in person to know what the court is and is not entitled to consider.

In the recent case of Suh and Another v Mace (UK) Limited [2016] EWCA Civ 4, the Court of Appeal considered whether alleged admissions made in meetings between one of the unrepresented claimant tenants and the landlord's solicitor were admissible evidence that could be used by the landlord against the tenants.

Background

The tenants, Mr and Mrs Suh, held a 20 year business lease of restaurant premises commencing in May 1999. The landlord re-entered the property in August 2010 and changed the locks. In January 2012 the tenants issued proceedings for damages for wrongful forfeiture of the lease. The landlord counterclaimed for payment of rent arrears.

The trial was listed for 3 days in March 2014 before Her Honour Judge Baucher in the Central London County Court. In January 2014 Mrs Suh asked to see the landlord's solicitor and arranged to meet her. In the meeting, Mrs Suh said that the purpose of the meeting was to find out how the case was progressing. Mrs Suh was not accompanied by a solicitor or other legal advisor. The landlord then claimed that during the course of the meeting Mrs Suh made admissions that (1) there had been rent arrears (which would have entitled the landlord to re-enter the property); (2) she had not signed certain court documents; and (3) she no longer wished to participate in the proceedings.

Consequently the landlord wished to rely on its solicitor's notes of the meetings with Mrs Suh, which appeared to support its defence and counterclaim. However, Mr and Mrs Suh denied that the admissions had been made and also argued that, in any case, the notes were covered by without prejudice...