A case concerning a snippy letter from a lawyer who should have known better to another one, who did, is an odd departure point for an excursion into without prejudice, but here we are.

This is what I would call an “Albert Haddock” case. Albert Haddock was A. P. Herbert’s ornery civilian litigant, always getting himself in trouble, or up the nose of the authority, presenting negotiable cows to the revenue, when on a flooded road arguing that vessels should pass starboard to starboard and so on. Albert Haddock is fictional. His real-life counterpart here is a chap called Dan Neidle. Mr. Neidle should understand I mean “Haddock” in the most reverential way: the JC is a big fan (of both Messrs. Haddock and Neidle). I like people who “poke the Borax” and I have no great fondness for civil litigators. And as we will see, there is nothing quite like a bit of “Neidle needle”.

That said, the ultimate outcome of this case, in which Mr. Neidle’s antagonist was exonerated from disciplinary charges sent his way, seems right. We will come to that in good time. First, the facts.

Facts

In July 2022 Dan Neidle, nowadays something of a public provocateur on matters of tax policy, but for many years Clifford Chance’s head of tax, published some embarrassing allegations about the tax affairs of the then recently-appointed Chancellor of the Exchequer, Nadhim Zahawi.

Unwisely — has no-one heard of the Streisand Effect? — Mr. Zahawi “went to the mattresses”. He engaged a firm of solicitors to shut Mr. Neidle up.

That firm of solicitors was Osborne Clark. Carriage of the matter fell to one Ashley Hurst, a litigation partner.

Mr. Hurst’s first instinct was sensible: he messaged Mr. Neidle suggesting they chat. Mr. Neidle was having none of it. He told Mr. Hurst to put whatever he had to say in writing.

Mr. Hurst replied, “Trying to avoid that. We can speak WP [“without prejudice”] if you like.”

Again, Mr. Neidle declined. He said, “Please note I will not accept without prejudice correspondence.”

Mr. Neidle said this because “without prejudice” communications have a special status in civil litigation. In essence, they cannot be put before the court. Mr. Neidle did not want to cede his right to put anything Mr. Hurst said before the court. “If you are not prepared to say it out loud,” Mr. Neidle implied, “do not say it.”

This did not deter Mr. Hurst. He composed a snippy letter he will have since come to regret.

Snippy letters are part of the stock-in-trade of civil litigation. Much of it is resolved without resort to much else. Most people back down at the first missive they receive on law firm-headed notepaper.

Mr. Neidle is not most people. He is not the backing-down type. Law firm-headed notepaper was not going to cow him: his own name had been on law firm-headed notepaper for many years. He does not frighten easily. He likes a scrap. Mr. Hurst ought really to have known this, from a casual read of the papers. It seems he did not.

Mr. Hurst emailed his snippy letter to Mr. Neidle. It was ill-judged in a few respects, but in one especially: it claimed to be “without prejudice and confidential”.

It said:

It is up to you whether you respond to this email but you are not entitled to publish it or refer to it other than for the purposes of seeking legal advice. That would be a serious matter as you know. We recommend that you seek advice from libel lawyer if you have not done so already.

There was no attempt to settle the dispute at all. Mr. Hurst’s letter was not an attempt to stave off litigation, but a veiled threat to embark on it:

Should you not retract your allegation of lies today, we will write to you more fully on an open basis on Monday.

In the meantime, our client reserves all of his rights, including to object to other false allegations that you have made.

I am available to discuss if you change your mind on having a phone call. That could well save time and expense on both sides.

Even at this stage, Mr. Hurst held out hope that a phone call might de-escalate things. He hoped in vain.

Mr. Neidle gave Mr. Hurst a polite version of what we might call the “Pressdram Salute”. He published Mr. Hurst’s “without prejudice and confidential” letter and, not long afterward, referred Mr. Hurst to the Solicitors Regulation Authority, complaining that Mr Hurst’s use of the “without prejudice” label amounted to, or somehow hinted at, a “strategic lawsuit against public participation”.

So-called “SLAPPs”, in which the moneyed and powerful use the legal system to stifle fair enquiry into matters of general public interest, have become a bane of public life in the UK. The SRA has been on the warpath against them. It saw in Mr. Neidle just such a “public participant” and, in Mr. Hurst’s letter, an intolerable attempt to muzzle him on Mr. Zahawi’s behalf. It began an investigation that culminated, 18 months later — no-one could accuse it of precipitate action — in a referral to the Solicitors Disciplinary Tribunal, on the grounds that Mr. Hurst was engaged in an illegitimate SLAPP.

Before we get to that, it is worth recounting what happened in the meantime, without the SRA’s intervention.

Firstly, Mr. Neidle did not retract any of his allegations, and in fact doubled down on them.

Secondly, Mr. Zahawi did not exercise any of his “reserved rights”. None of the veiled threats in Mr. Hurst’s letter came to pass.

To the contrary, in January 2023, Mr. Zahawi was reported to have paid a penalty to HMRC. Shortly after that the Prime Minister’s Independent Adviser on Ministers’ Interests identified that he had breached the ministerial code seven times. The Prime Minister sacked Mr. Zahawi from his post as Chancellor of the Exchequer the same month. Within a year, in the face of growing opposition from his own constituency party, he announced he would not stand in the 2024 General Election.

That is to say, thanks in significant part to his misconceived attempt to limit Mr. Neidle’s “public participation” Mr. Zahawi’s political career spectacularly imploded.

We should take heart from this outcome. It feels like a system working well: hubris is rewarded with nemesis. The cosmos has delivered its own savage justice. In its perverse way, a prominent politician’s freedom to detonate his own reputation seems a positive constitutional safeguard. It is not clear what further action is needed.

The Solicitors Regulation Authority did not agree. It came for Mr. Hurst. Two days after the Chancellor’s sacking, the SRA referred him to the Solicitors Disciplinary Tribunal. It accused him of breaching SRA guidance by improperly labelling his correspondence “without prejudice”, “confidential” and “not for publication”, when the conditions justifying those labels were unfulfilled.

This seems a rather timid complaint. SRA guidance cautions solicitors not to intimidate or mislead third parties, and to take particular care with the vulnerable or unrepresented, but the SRA’s focus on these formal indicators, rather than the substantive intimidations in the body of the letter, seems rather, well, formalistic.

It may be because it seemed a “slam dunk” contravention of SRA guidelines. They specifically call the formal labels out:

One way this can happen in this context is by labelling or marking correspondence ‘not for publication’, ‘strictly private and confidential’ and/or ‘without prejudice’ when the conditions for using those terms are not fulfilled.

In any case the SDT heard the matter in December 2024 and, in May the following year, handed down its decision. It agreed that Mr. Hurst had acted improperly and fined him £50,000.

Mr. Hurst appealed. In January 2026 the administrative decision of the High Court upheld his appeal and overturned the SDT’s finding.

In light of the practical resolution of events — Mr. Hurst’s client torching his own political career — and the curiously formalistic approach to the disciplinary breach, this seems the correct outcome.

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Without prejudice

“Without prejudice” is, in JC’s view, a silly frippery of the civil courts. In seeking to imbue a kind of legal privilege to bona fide settlement offers — a privilege they absolutely do not need — the courts have evolved a fiddly, confusing and self-contradictory cranny of procedural jurisprudence. Rather than regarding them simple markers of a constructive approach to dispute resolution, the court is expected to pretend that formal settlement overtures do not exist. They acquire an odd, mystical, Schrodinger’s cat-type status, though, because — sometimes — they can be presented when it comes to arguing about costs.

But that’s as may be, however: the “without prejudice” rules exist and we are stuck with them. So is Mr. Hurst.

A key plank in the SRA’s argument was that Mr. Hurst’s communication was no kind of settlement offer, and that therefore labelling it “without prejudice” was improper and intimidating. This idea is implicit in its guidance, quoted above.

But this gets things exactly backward: a “without prejudice” label (for whatever reason it is applied!) is the opposite of threatening: it signals a settlement offer. One should be overjoyed to receive a without prejudice letter. The “prejudice” it seeks to avoid is to the interests of the sender. Without prejudice is defensive, not intimidatory. It is a white flag, not a black one.

That, indeed, is why the courts developed its silly jurisprudence: to spare the sender’s blushes: to prevent disclosure before court a document which on its face speaks to its author’s weakness.

“Without prejudice” seeks to avoid misconstrual as a concession of weakness from the sender, not aggression. The SRA guidance in this regard seems off-base.

The SRA asserted Mr. Hurst’s communication was no kind of settlement offer. It may not have been, but it was — arguably — an attempt to resolve the matter: a “confidential and genuine attempt to resolve a dispute with you before further damage is caused”, in Mr. Hursts’ own prose.

On the face of it, the email was plainly and indisputably aimed at securing the retraction of the allegations of lying as an alternative to the possibility of defamation litigation.

Attempts to resolve disputes by demanding retraction are not really what the “without prejudice” rule is about, though — where is the potential prejudice in that? — and, in any case, not being allowed to show your letter to a judge if you are sued is hardly as grievous an intimidation as, well, actually being sued — and, ipso facto, there can be nothing wrong with a citizen its exercising legal rights to do that. Which, in any case, Mr. Zahawi did not ultimately do.

Mr. Hurst’s real mistake was to confuse his labels. “Without prejudice” does not come into it. What he really wanted to say — and did also say — was that Mr. Neidle must be silent about his letter: that it was protected by legal obligations of confidentiality.

Unfortunately for his client, Mr. Hurst was wrong about this, too.

Confidentiality

Every commercial lawyer knows a bit about confidentiality. You can hardly miss it: every commercial relationship — every exploratory discussion, however offhand — will be prefaced with an NDA.

All NDAs say the same few essential, uncontroversial things. There are about five main points. Everyone knows them. No-one argues about them. But most NDAs also try to crowbar in a couple of inessential, stupid and outrageous things. These are less predictable, but come from a stable roster of about ten inessential, stupid or outrageous commercial positions that are commonly said in the context of an NDA negotiation.

Lawyers, since time immemorial, have argued these same theoretically, but not practically, risky elements. This is a sociological conundrum in need of explanation: no-one enjoys doing NDAs, they serve no particular purpose beyond stating the obvious, no-one ever sues on them, but no-one has quite yet figured how not to do them.

It is a small mystery that no standard conceptualisation of how one should behave when collaborating has emerged, but that is another story. Good people have, with only moderate success, tried.

Generally, if you want to tell someone a secret, and want them not to blab about it, you need a contract.

Still, there is a sense that lawyers are somehow different. We have a vague sense that if a solicitor writes to us on notepaper headed “confidential” then this must mean something. It does work the other way: what you tell your solicitor she must keep confidential: what she tells you, you need not. All the more so, a third party’s solicitor.

Our vague sense here, that is to say, is wrong. The SRA is sufficiently worried about it to issue guidance and — in this case — to launch disciplinary proceedings about it. This seems uncalled-for to me: it is one thing to wrongly threaten people to keep quiet. It is another thing to try, wrongly, to use the justice system to make them be quiet. Mr. Hurst did not do the second thing. There was no strategic lawsuit.

In any case, the lesson for Mr. Hurst, his client and the rest of us is this: the way to enforce confidentiality is, first and foremost, to keep your own mouth shut, rather than blabbing your innermost thoughts to unencumbered members of the general public. If you do, you really have only yourself to blame. Especially if you blab to a member of the general public as joyfully unencumbered as Mr. Neidle.

The High Court ruling

Mr. Neidle is disappointed about the court outcome, but really has no need to be. As the celebrated non-case of Arkell v Pressdram ably illustrates, commercial litigators write clumsy letters from time to time. We should expect the odd mis-step, but calling Matron every time a litigation lawyer gets over the front of his skis will have its own chilling effect on legal practice. And after all, if this level of misstep deserves SDT censure, especially given its ultimate outcome — if anyone here has a grievance, it is Mr. Zahawi, who might still have his seat had Mr. Hurst given him more forthright advice — then we should expect a lot more commercial litigators in the village stocks.

Mr. Hurst’s letter was silly. He should not have sent it. But it had none of its intended effects. Quite the opposite: there was no litigation, Osborne Clark quickly de-escalated and, in due course, the aggrieved Chancellor was drummed from office, partly because of his unsatisfactory tax affairs. Mr. Neidle was entirely vindicated and his reputation accordingly burnished.

We may summon a pained expression, but it is hard to see a need for further action against Osborne Clark or Mr. Hurst.

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