Denroy Baptiste Claimant v Tortola Yacht Services Ltd Defendant

JurisdictionBritish Virgin Islands
JudgeJoseph-Olivetti, J.
Judgment Date28 May 2008
Judgment citation (vLex)[2008] ECSC J0528-2
CourtHigh Court (British Virgin Islands)
Docket NumberBVIHCV2006/0130
Date28 May 2008
[2008] ECSC J0528-2



Denroy Baptiste
Tortola Yacht Services Limited

John Carrington of Todman & Co. for the Claimant

Tana'ania Small-Davis of Farara Kerins for the Defendant

(Personal injuries - compensation - 42 year old man involved in accident at work - injury to back and shoulder, degenerative disc disease-quantum of general damages Practice and Procedure - 'without prejudice' correspondence exchanged between claimant's counsel and defendant's insurers - whether defendant entitled to rely on such correspondence at trial to support allegations that claim had been settled - principles governing use of 'without prejudice' communications Contract - whether 'without prejudice' correspondence evidence a settlement agreement)

Joseph-Olivetti, J.

This is a claim for damages for personal injuries arising from an accident in the work place. On 29th May 2000 Mr. Denroy Baptiste was employed as a painter with the Defendant, Tortola Yacht Services Ltd ("TYS") at Wickhams Cay. He suffered injuries when a rope on which he had been pulling on to assist in lifting a boat out of the water broke and he was thrown into the water on his back. He is now seeking compensation for his injuries. In defence, TYS says first that the claim was settled prior to suit or alternatively that they are not liable and/or that Mr. Baptiste contributed to his accident.


I now turn to the first and primary issue raised by TYS which is whether or not the claim had been settled. TYS sought to rely on two letters to establish a settlement agreement. Issue was taken at trial as to the admissibility of these documents on the basis that they were made 'without prejudice' and perforce were inadmissible.


However, Mr. Carrington's objections could not withstand the formidable torrent of authorities 1 relied on by Mrs. Small-Davis. This was to the effect that "without prejudice" communications could be relied on to establish a concluded agreement arising therefrom or for the purpose of deciding whether such an agreement had indeed been reached and the letters were admitted. For completion and as the admission of the letters was crucial to the defence I will visit the main authorities on which I based my decision to admit the letters.


The principal case is Tomlin v. Standard Telephones & Cables Ltd.2 where Danckwerts L.J. said referring to dicta of Lindley L.J. in Walker v. Wilsher (1889) 23 Q.B.D. 335:-

"In the course of his judgment, however, Lindley L.J. said, at p. 337:

"What is the meaning of the words "without prejudice"? I think they mean without prejudice to the position of the writer of the letter if the terms he proposes are not accepted. If the terms proposed in the letter are accepted a complete contract is established, and the letter, although written without prejudice, operates to alter the old state of things and to establish a new one."

That statement of Lindley L.J. is of great authority and seems to me to apply exactly to the present case if, in fact, there was a binding agreement, or an agreement intended to be binding, reached between the parties, and, accordingly, it seems to me that not only was the court entitled to look at the letters, though they were described as "without

prejudice," but it is quite possible (and, in fact, the intention of the parties was) that there was a binding agreement contained in that correspondence. This disposes of the first point."…

From those cases it seems to me that the principle which emerges is that the court will protect, and ought to protect, so far as it can, in the public interest, "without prejudice" negotiations because they are very helpful to the disposal of claims without the necessity for litigating in court, and therefore, nothing should be done to make more difficult or more hazardous negotiations under the umbrella of "without prejudice." I am well aware, coming form the Division from which I do come that letters get headed "without prejudice" in the most absurd circumstances, but these letters, in my judgment, are not letters headed "Without prejudice" unnecessarily or meaninglessly. They are plainly "without prejudice" letters, and therefore, the court, in my judgment, should be very slow to lift the umbrella of "without prejudice" unless the case is absolutely plain."


And, see also Halsbury's Laws of England Vol. 17 at page 152:-

" 213. Limits of the rule.The contents of a communication made "without prejudice" are admissible when there has been a binding agreement between the parties arising out of it, or for the purpose of deciding whether such an agreement has been reached, and the fact that such communications have been made (though not their contents) is admissible to show that negotiations have taken place, but they are not otherwise admissible. Thus they cannot be used as admissions, or as acknowledgements to prevent a debt from coming statute-barred, or, normally, for the purpose of deciding the question of costs, or to show malice, although it has been held that they may be admitted to prove matters not connected with the merits of the dispute.

The consent of both parties to the dispute is required for the privilege to be waived, even if there has been only one communication." (Emphasis added)


Save with one exception I accept the evidence of Mr. Graham Wickens, the Adjuster for TYS' insurance company, Royal and Alliance Insurance (Puerto Rico) Inc. as to the circumstances in which these letters were written. That is, that the first letter dated 19th November 2001 from Mr. Baptiste's solicitors, McW Todman & Co. was in response to a letter of 2nd February 2001 from Caribbean Adjusters Ltd (this letter was not produced) and that the second dated 11th October 2005 from McW Todman & Co to Caribbean Insurers Ltd was a follow up to a telephone conversation between the writer, Ms. Melanie Williams of Mc W. Todman & Co. and not Mr. Wickens as he testified but to the addressee, Ms. Bernadine Thomas (of Caribbean Insurers Ltd).had it been otherwise in my view it would not have been addressed specifically to her.


The first letter, admitted as "GW 1" is written by Mr. Hayden St. Clair Douglas. The letter on its face is a quantification of the claim for loss and damage suffered by Mr. Baptiste as a result of the said accident. It set out the background to the claim and detailed the injuries sustained and made reference to various cases. 3 Finally, Mr. St. Clair Douglas claimed:-


as general damages

$ 5,500.00

cost of reconstructive surgery

$ 1,653.80

special damages

$ 2,798.07




The letter of 11th October 2005 (four years later) admitted as "GW 2" is brief and is set out hereunder in full:-

"Further to our telephone conversation of 6 October, I confirm that my client has instructed us that he is now prepared to accept your offer to settle this matter, by paying the sum of $20,422.80, inclusive of legal costs.

I also confirm that our client has not received any payments form his former employers for the injuries which he sustained as a result of their negligence and failure to provide a proper work environment.

We look forward to the receipt of your further correspondence in relation to this matter."


Can these letters be said to amount to a binding contract or evidence of settlement without more? First, I note the length of time which has elapsed between the two letters. Next I see that one was sent to Caribbean Adjusters Limited and the other to Caribbean Insurers Limited. No explanation has been given by TYS as to whether or not the addressees are in fact the same entity, but in all the circumstances it seems so. The second letter bears no reference to the first and specifically the figures are different though not significantly so. It refers to a telephone conversation of 6th October with the addressee. Mr. Wickens in his witness statement said that he spoke to Ms. Williams on the 6th October 2005 and she told him that her client had agreed to accept the sum of $29,422.80 inclusive of costs and that she wrote to that effect on the 11th October 2005. Did he make this offer to her prior to 6th October so that she had her client's instructions when she spoke to him on the 6th October? And, if he made the offer why did she not direct her confirmatory letter to him? It also raises the question whether that sum was to be in full and final settlement of the entire claim. I find that the offer was made prior to the second letter, not by Mr. Wickens but by Ms. Thomas.


Furthermore, the second paragraph raises the clear inference that this offer was in some way conditional upon whether Mr. Baptiste had received any payments from his employer for his injuries and if so how was that to be dealt with. And, the last sentence of the letter clearly anticipated further correspondence between the parties. We have seen none.


Mr. Wickens explained that they had discussed whether Mr. Baptiste had received any payments from his employer as that would have impacted on his offer. He testified that he subsequently learnt that Mr. Baptiste had been paid the difference between his wages and what he received from Social Security in respect of his earnings and that the intention of the parties was to set off those sums paid by the employer from the sum of $20,422.80 agreed on. Based on that he made no payments to Mr. Baptiste as Mr. Baptiste had already received more than $20,422.80 from TYS. Yet, Mr. Wickens did not see fit to correspond with McW Todman to explain this course of action and to obtain McW Todman's confirmation that they accepted that full and final payment on behalf of their client had been made by way of this set off.


Further, Mr. Baptiste did not sign the usual release which Mr. Wickens referred to in para 8 of his...

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