---
title: "Flag a settlement negotiation note before it is indexed"
url: "https://ailawframework.com/practice/knowledge-management/flag-a-settlement-negotiation-note-before-it-is-indexed"
type: "task"
site: "AI Law Framework"
id: "KM-MA20261022-12"
practice_area: "Knowledge Management"
tier: "yellow"
lawyer_review: "required"
last_reviewed: "2026-10-22"
---

# Flag a settlement negotiation note before it is indexed

> Before a note, letter or draft is added to the know-how bank, record whether it is a communication made between persons in dispute, or between one or more persons in dispute and a third party, in connection with an…

Canonical page: https://ailawframework.com/practice/knowledge-management/flag-a-settlement-negotiation-note-before-it-is-indexed  
Last reviewed: 2026-10-22

Site index for agents: https://ailawframework.com/llms.txt

## Key facts

| Fact | Value |
| --- | --- |
| Practice area | [Knowledge Management](https://ailawframework.com/practice/knowledge-management.md) |
| Human involvement | Yellow: Lawyer and AI draft together |
| How AI is used | Before a note, letter or draft is added to the know-how bank, record whether it is a communication made between persons in dispute, or between one or more persons in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute, or a document prepared in connection with such an attempt. Record any statement in it that it was not to be treated as confidential. Do not decide that an exception applies. Do not decide that the note may be indexed or that evidence of it may be adduced. |
| What the lawyer must review | The lawyer decides whether section 131 of the Evidence Act 1995 (Cth) applies, where that Act applies, and whether the note may be indexed. Subsection (1) says evidence is not to be adduced of a communication made between persons in dispute, or between one or more persons in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute, or of a document, whether delivered or not, prepared in connection with an attempt to negotiate a settlement of a dispute. Subsection (5) says a dispute is one of a kind in respect of which relief may be given in an Australian or overseas proceeding, and that an attempt to negotiate a settlement does not include an attempt to negotiate the settlement of a criminal proceeding or an anticipated criminal proceeding. A communication by a person in dispute includes a communication by an employee or agent. Consent of a person in dispute includes consent of an employee or agent who is authorised to consent. Commission of an act includes a failure to act. Subsection (6) says power means a power conferred by or under an Australian law. Subsection (2) sets out when subsection (1) does not apply, including consent of the persons in dispute, disclosure of the substance with the express or implied consent of all of them, a statement that the communication or document was not to be treated as confidential, a proceeding to enforce an agreement to settle or in which the making of such an agreement is in issue, relevance to determining liability for costs, and the further cases in paragraphs (c), (e), (g), (i), (j) and (k). Paragraph (j) covers a communication made or a document prepared in furtherance of a fraud, an offence, or an act that renders a person liable to a civil penalty. Paragraph (k) covers the case where a person in dispute, or an employee or agent, knew or ought reasonably to have known that it was made or prepared in furtherance of a deliberate abuse of a power. Subsections (3) and (4) provide for a finding, on reasonable grounds, for paragraphs (2)(j) and (2)(k). The lawyer makes that judgment. The tool does not. State evidence statutes were not opened. This is not a privilege flag under sections 118 or 119, and it is not a check of material produced under compulsion. |
| Written for / versions | 1 jurisdiction versions below |

## Checking plan

**Source-by-source verification**

Trace relied-on content to independent sources and check for relevant material the output has missed.

- What the AI does: Before a note, letter or draft is added to the know-how bank, record whether it is a communication made between persons in dispute, or between one or more persons in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute, or a document prepared in connection with such an attempt. Record any statement in it that it was not to be treated as confidential. Do not decide that an exception applies. Do not decide that the note may be indexed or that evidence of it may be adduced.
- What the lawyer does: The lawyer decides whether section 131 of the Evidence Act 1995 (Cth) applies, where that Act applies, and whether the note may be indexed. Subsection (1) says evidence is not to be adduced of a communication made between persons in dispute, or between one or more persons in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute, or of a document, whether delivered or not, prepared in connection with an attempt to negotiate a settlement of a dispute. Subsection (5) says a dispute is one of a kind in respect of which relief may be given in an Australian or overseas proceeding, and that an attempt to negotiate a settlement does not include an attempt to negotiate the settlement of a criminal proceeding or an anticipated criminal proceeding. A communication by a person in dispute includes a communication by an employee or agent. Consent of a person in dispute includes consent of an employee or agent who is authorised to consent. Commission of an act includes a failure to act. Subsection (6) says power means a power conferred by or under an Australian law. Subsection (2) sets out when subsection (1) does not apply, including consent of the persons in dispute, disclosure of the substance with the express or implied consent of all of them, a statement that the communication or document was not to be treated as confidential, a proceeding to enforce an agreement to settle or in which the making of such an agreement is in issue, relevance to determining liability for costs, and the further cases in paragraphs (c), (e), (g), (i), (j) and (k). Paragraph (j) covers a communication made or a document prepared in furtherance of a fraud, an offence, or an act that renders a person liable to a civil penalty. Paragraph (k) covers the case where a person in dispute, or an employee or agent, knew or ought reasonably to have known that it was made or prepared in furtherance of a deliberate abuse of a power. Subsections (3) and (4) provide for a finding, on reasonable grounds, for paragraphs (2)(j) and (2)(k). The lawyer makes that judgment. The tool does not. State evidence statutes were not opened. This is not a privilege flag under sections 118 or 119, and it is not a check of material produced under compulsion.
- Who reviews: Responsible lawyer with competence in the matter
- Basis: Practical workflow informed by the linked primary sources; the traffic light and working checks are editorial guidance, not a court classification.
- Why: The level reflects what the work is, the consequence of an error, and how much of the output the lawyer must independently re-derive.

## Checks the lawyer makes

1. Flag the note if it is a communication or a document in connection with an attempt to negotiate a settlement. Do not decide an exception.
2. A negotiation of a criminal proceeding, or an anticipated criminal proceeding, is outside the definition in subsection (5)(b). Record that character and leave the conclusion to the lawyer.
3. Consent by an employee or agent counts only if that person is authorised to consent, under subsection (5)(d).
4. Do not treat the note as a privilege review or as a check of material produced under compulsion. Those are separate tasks.

## Notes

- These are suggested working checks. Confirm the required checking with the responsible lawyer before work starts; the checking approach does not establish permission to use AI.

## Sources

- [Evidence Act 1995 (Cth) section 131](https://classic.austlii.edu.au/au/legis/cth/consol_act/ea199580/s131.html) (checked 2026-10-22)

## Jurisdiction versions

| Jurisdiction | Level |
| --- | --- |
| [United States](https://ailawframework.com/practice/knowledge-management/flag-a-settlement-negotiation-note-before-it-is-indexed/united-states.md) | Yellow |

*Practice guidance for planning and review. Confirm current primary sources and the requirements of the actual matter. This is general information, not legal advice.*