When Without Prejudice Isn't
The without prejudice rule has long been part of South African law. This rule provides that statements, including admissions of liability, made in an attempt to settle litigation between parties, are not admissible in subsequent litigation between them. Underpinning the rule is that the parties should be encouraged to avoid litigation by resolving their disputes amicably in frank discussions, without the fear that if negotiations fail, admissions made in the course of their negotiations may be used against them in subsequent litigation.
· The SCA, relying on a previous judgment, Murray & Roberts Construction (Pty) Ltd v Upington Municipality, opined that section 14 of the Prescription Act protects the creditor, and the same considerations that justify prescription also suggest that the time limit should not be absolute. To this end, section 14 provides that the running of prescription is interrupted by an acknowledgment of liability by the debtor. The reason for this is clear – if the debtor acknowledges liability, there is no uncertainty about the debt.
· Underlying the without prejudice rule is the promotion of settling disputes parties without resorting to litigation.
· Where there is an acknowledgment of liability, there is no uncertainty on the part of the debtor as to the existence of the debt and where the debtor removes uncertainty by admitting liability, the running of prescription should be suitably adapted. It is in the public interest that the debtor who acknowledges debt and induces the creditor not to have immediate resort to litigation, should not be able to claim that the debt has prescribed, notwithstanding that the acknowledgment is made in a without prejudice context.
Dispute resolution accredited mediator CEDR construction director aaguiar@ENSafrica.com cell: +27 82 443 3056
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