Privilege in lawyer communications, including without prejudice offers, can be a somewhat complex legal issue on occasion and this blog is a brief overview of the topic.
Middlecamp v Fraser Valley Real Estate Board 1992 CarswellBC267 ( BCCA) cited R. v. Fosty (1991) SCR 263 wherein the Supreme Court of Canada described the two principal kinds of privilege. At p. 303 :
1) Public Policy
… The first four terms are used to refer to a privilege which was recognized at common law and one for which there is a prima facie presumption of inadmissibility (once it has been established that the relationship fits within the class) unless the party urging admission can show why the communications should not be privileged (i.e., why they should be admitted into evidence as an exception to the general rule). Such communications are excluded not because the evidence is not relevant, but rather because there are overriding policy reasons to exclude this relevant evidence. Solicitor-client communications appear to fall within this first category: see Geffen v. Goodman Estate (1991), 81 D.L.R. (4th) 211, 80 Alta. L.R. (2d) 293, 127 N.R. 241 (S.C.C.); R. v. Solosky (1979), 50 C.C.C. (2d) 495, 105 D.L.R. (3d) 745, [1980] 1 S.C.R. 821.
2) The term “case-by-case” privilege is used to refer to communications for which there is a prima facie assumption that they are not privileged (i.e., are admissible).
The case-by-case analysis has generally involved an application of the “Wigmore test” (see above), which is a set of criteria for determining whether communications should be privileged (and therefore not admitted) in particular cases. In other words, the case-by-case analysis requires that the policy reasons for excluding otherwise relevant evidence be weighed in each particular case.
Wigmore’s four tests are the standard by which case-by-case privilege will be measured.
They are found in the McNaughton revision (1961), vol. 8, p. 257, para. 2285, as follows:
(1) The communications must originate in a confidence that they will not be disclosed.
(2) This element of confidentiality must be essential to the full and satisfactory maintenance of the relation between the parties.
(3) The relation must be one which in the opinion of the community ought to be sedulously fostered.
Without Prejudice Communications
(4) The injury that would inure to the relation by the disclosure of the communications must be greater than the benefit thereby gained for the correct disposal of litigation.
Without Prejudice
The public interest in the settlement of disputes generally requires “without prejudice” documents created for or communicated in the course of settlement negotiations to be privileged. It is a “blanket,” “prima facie,” “common law” or “class” privilege because it arises from settlement negotiations and protects the class of communications exchanged in the course of that worthwhile endeavour.
Belanger v. Gilbert (1984), 14 D.L.R. (4th) 428 (B.C. C.A) held that just because a document is marked without prejudice does not mean that is privileged.
in Schetky v. Cochrane et al., [1918] 1 W.W.R. 821, 24 B.C.R. 496, and the judgment of Mr. Justice Martin at p. 827. On that page Mr. Justice Martin referred to the case of Re Daintrey, Ex p. Holt, [1893] 2 Q.B. 116, in which he said:
… it was held that an admission of bankruptcy may be proved in a letter from the debtor to the creditor, though marked “without prejudice” …
Before the privilege arises two conditions must exist,
(a) a dispute or negotiation between two or more parties; and
(b) in which terms are offered
