Admissions without prejudice. – Confidential overtures of pacification and any other offers or propositions between litigating parties expressly or impliedly made without prejudice, are excluded on grounds of public policy. Without this protective rule it would often be difficult to take any steps towards an amicable compromise or adjustment.
Lord Mansfield has observed that all men must be permitted to buy their peace without prejudice to them should the offer not succeed, such offers being made to stop litigation, without regard to the question whether anything is due or not. If, therefore, the defendant, on being sued for $ 100, should offer the plaintiff $ 20, and at the same time state that such offer was “without prejudice” this is not admissible in evidence, for it is irrelevant to the issue. It neither admits nor ascertains any debt, and is no more than saving that he would give $ 20 to be rid of the action. [Tailor, p. 795].
The true reason for excluding from evidence such overtures and offers is that they do not ordinarily proceed from and imply a brief that the adversary’s claim is well founded, but rather a belief that the further prosecution of that claim whether well founded or not, would in any event cause such annoyance as is preferably avoided by the payment of the sum offered. The offer implies merely a desire for peace, not a concession of wrong done [Wigmore, p. 1061], and is, therefore, not an admission of liability at all. [Section 23, Evidence Act, 1872].