Early Neutral Evaluation

This is the sixth article in our Coronavirus and ADR Series, in which we will be discussing expert Early Neutral Evaluation.

In our first article in the series, we introduced Alternative Dispute Resolution (ADR). We then looked at mediation, arbitration, expert determination and adjudication.

What is Early Neutral Evaluation?

Early Neutral Evaluation (ENE) is a form of alternative dispute resolution in which an independent and impartial evaluator is appointed to give the parties an assessment of the merits of their case.

The objective of an ENA is to give parties a realistic indication of the strengths and weaknesses of their respective cases to help inform the negotiations between the parties.

Early Neutral Evaluation is typically a non-binding form of alternative dispute resolution which is often without prejudice (in other words hidden from the court) and can help parties avoid further unnecessary stages in litigation.

How does it work?

In Early Neutral Evaluation, an independent party evaluates a case at an early stage and expresses a preliminary view on the case. The independent third party is likely to be a judge, retired judge or QC. They hear each party’s submissions and then state their view on the likely outcome at trial. That view is without prejudice and has no binding effect.

ENE can be pursued through the courts or through an organisation. The court has the power to order an ENE hearing. The idea is that this will then encourage the parties to form a realistic view of the realities of their case and attempt to settle with the other side.

Early Neutral Evalutation can be used as a stand-alone dispute resolution method, where the parties attempt to settle the dispute immediately following the ENE. Alternatively, it can be used as springboard for mediation.

The advantages of Early Neutral Evaluation

Identification of issues

It can help to narrow the issues in dispute, even if it does not result in settlement.

Efficiency

It can be a quick process and less formal than arbitration or litigation.

Reality check

It can provide a reality check for clients and identify any weaknesses in a party’s case and gaps in evidence.

Springboard for settlement

It usually helps to facilitate settlement discussions.

The disadvantages of Early Neutral Evaluation

Potentially one sided

One party may become more entrenched in its position if the evaluation is in its favour, hindering a settlement or becoming more demanding in settlement negotiations.

Not suitable where the dispute turns on issues of fact

The evaluator will not hear all of the factual witness evidence that would be heard at trial. ENE therefore may not be suitable for cases involving large complex factual disputes.

If you would like more information, please get in touch with our team.