Settling Out Of Court...'without prejudice'

djsunset_2

A creditor issued a bankruptcy petition against me, I filed a notice to oppose because I disputed the debt, and I have been in discussions with the petitioning creditor's solicitor since to try and settle out of court. They have now made an offer, "WITHOUT PREJUDICE", to accept part of the initial claimed amount as full and final settlement.

To end this once and for all, I am prepared to accept the offer. My question: Is their offer legally binding?
i.e. if I reply to them and say I accept the offer, can they then turn around and say no, we actually want the full initial claimed amount - does 'without prejudice' protect them in this way?

tyllwyd

I thought it was the other way round - if it went to court with them asking for the full amount, they don't want you to be able to produce the letter and use it to prove that they have agreed that their claim is only worth a lower amount.

(I could be wrong though, don't quote me on it!)

Norfolk_Jim

They just dont want you to be able to be able to show this offer in court as part of your case. You can accept the offer but if things dont work out for whatever reason you wont be able to stand up in court and say "They were willing to take X ammount X days ago your honour" as part of your defence.

djsunset_2

OK, but if I accept the offer and communicate this to them, and arrange to make payment, can I consider the matter definitely closed, or are they allowed to change their mind about the offer they made?

debtdesperado

if you get a binding agreement (eg they send you a letter setting out what you need to pay, and you sign it and send it back), they shouldn't be able to go back on it, unless you break it, eg you miss a payment.

If that happens, they will take you to court for the full amount, and the reason for writing 'without prejudice' on this correspondence is that it means that in any subsequent action, the court won't see the discount that they offered you and therefore that you can't argue that because previously they were prepared to accept a lower offer, they can't chase you for the whole lot now.

gratefulforhelp_2

"without prejudice" just means they are making an offer that you can't bring up in court. You are free to reply "without prejudice" just head your letter with that phrase.

djsunset_2

ok thanks for your responses, was actually keen to fight the whole thing in court, might well have had to pay nothing that way - but really can't be bothered with the whole process now. So I don't mind settling for the agreed amount. Just want to be sure that they won't take my payment for the agreed amount, and then later try to pursue me for the rest.