In BGC Brokers LP &Ors v. Tradition UK &Ors,[i] the English Court of Appeal unanimously dismissed an appeal against an order to disclose a settlement agreement in an undigned form. The court found that neither the “unprejudiced” privilege nor the procedural privilege had any application of the settlement agreement, although it returned confidential communications that would themselves be directly covered by one or both privileges. The Court held that the reproduction and inclusion of confidential communications in the settlement agreement formed part of a new and separate communication the purpose of which was neither to negotiate a settlement agreement nor to collect evidence for the purposes of the dispute. This decision shows the importance of taking privileges into account in the design of transaction agreements. Caution should be exercised with respect to the reproduction of existing privileged documents as part of a settlement agreement and privilege should not be expected to be maintained. Practitioners should keep in mind that the repetition of a privileged communication is considered a communication in its own right and is judged on its own merits in terms of legal privilege. The Court of Appeal dismissed the appeal (Arnold LJ rendered the main judgment approved by Lewison and Richards LJJ). You can apply to the District Court to cancel the registration of the transaction agreement by registering with CJTS and submitting the necessary online application. Not surprisingly, communications included in a settlement agreement have thus lost their status without prejudice.
It has long been established that when a settlement agreement is concluded by accepting an offer without prejudice, the offer is no longer protected by the indemnification rule, since it is part of the contract. It seems logical that this also applies to communications included in a settlement agreement. Master Davison rejected both privileges and ordered access to the unwarmed transaction agreement and the third email, and Moulder J dismissed BGC`s appeal. BGC appealed to the Court of Appeal. The purpose of the settlement agreement was to record and enter into a transaction, not to negotiate one, and therefore it did not fall under the “unprejudiced” privilege. The Court of Appeal held that the applicant was not entitled to withhold inspection notices that had been included in a settlement agreement with one of the five defendants.