Without prejudice privilege: the “unambiguous impropriety” exception

In Henderson & McPherson v Ministry of Defence [2026] EWHC 2645 (SCCO), the Senior Courts Costs Office provides a useful reminder of the strength of without prejudice privilege (‘WPP’). The case concerned costs schedules exchanged during negotiations and whether alleged discrepancies with later bills of costs justified lifting WPP. The Court held they did not. 

The Law in Brief 

WPP protects genuine settlement negotiations from being put before the court. The protection is deliberately strong, providing a “veil or cloak” of privilege, but there are several recognised exceptions to this privilege. One exception arises where “the exclusion of the evidence would act as a cloak for… unambiguous impropriety” (see Unilever v Procter & Gamble [2002] 1 WLR 2436). This prevents WPP from being used to protect genuinely improper conduct. Over the years the English courts have had to grapple on a number of occasions with what behaviour constitutes “unambiguous impropriety”. A high hurdle must be overcome to set aside the privilege on this ground and there are few examples where unambiguous impropriety has been established.  

As noted within the Henderson decision, unambiguous impropriety exception is not “a broad and flexible rule” (see Berry Trade Ltd v. Moussavi [2003] EWCA Civ 715 and SIB Ltd v. Sincken [2003] EWCA Civ 1630) and “deliberately, is difficult to satisfy” (see Motorola Solutions Inc v. Hytera Communications Corp Ltd [2021] EWCA Civ 11). For example, an inconsistency between a without prejudice position and a later open position is not enough; the statement must demonstrably constitute an abuse of the privilege.  

This Case in Brief: lower bills did not establish impropriety

In the case of Henderson, the Ministry of Defence argued that discrepancies between the claimants without prejudice costs schedules and their later, lower bills showed unambiguous impropriety. The Court rejected that argument. It found that the schedules reflected costs actually incurred. The later bills were reduced because costs lawyers exercised professional judgement over what was recoverable between the parties and sought to narrow the issues in dispute. The Court also rejected the suggestion that the schedules had been intended to induce settlement at an inflated value. 

However, this did not mean the costs schedules in Henderson were perfect. The claimants’ solicitors could have done more to address some duplication and disproportionality. But there were no fundamental calculation errors or misrepresentations. The position was therefore “a long way short of any form of CPR 44.11 misconduct” or unambiguous impropriety (see paragraph 17-18). The schedules therefore remained privileged and could not be relied upon at the detailed assessment. 

Compare this with McNamee v LB Brent [2025] EWHC 2612 (SCCO), where the court removed WPP protection where an informal statement of costs had ‘grossly exaggerated’ the claimant’s true entitlement. In that case the ‘degree of misrepresentation was considerable’, representing more than 60% of the defendant’s maximum liability. This was caused by a series of serious errors, including inflated hourly rates, incorrect levels of lawyer seniority and a major overstatement of the time spent on recoverable work.

Key Takeaway: 

WPP is “jealously guarded”, reflecting the importance of allowing parties to negotiate freely and the bar for unambiguous impropriety is deliberately high. A discrepancy alone is not enough. 

Written by Stacie Bourton and Jacob Berger