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Early Neutral Evaluation | PhloxADR
by Dr. Justin Wood, Th.D., CJME

Early Neutral Evaluation (ENE) is a form of alternative dispute resolution with in the scope of arbitrationA third party neutral who makes an award or decision on a case.  but less formal than, arbitration where one or both sides in a dispute seek the opinion of neutral third party to evaluate their case.

ENE is typically an informal conference held early in the case where the parties present written and oral summaries of the dispute to a neutral evaluator. The evaluator offers a non-binding opinion of each party’s position and a candid assessment of the possible outcomes of the case, if it were to proceed to trial. The evaluator may also help the parties discuss settlement and provide guidance regarding any additional discovery if the case is settled.

The process is most useful when done early in the dispute before too much time and expense is spent on the litigation process.  The neutral evaluator is typically someone with experience in subject matter of the dispute and can offer an unbiased and informed assessment of the case including relative liability of the parties, estimated settlement value, and the strengths and weaknesses of each side’s position.

ENE may be particularly effective if one of the parties has unrealistic expectations regarding the outcome of the case.

We have experience with a wide range of ADR techniques and would be happy to talk with you about your case. Please contact us today for a free consultation.

We found an interesting article on Early Neutral Evaluations…

Early Neutral Evaluation (“ENE”) and Mediation are both types of alternative dispute resolution (“ADR”) used to help resolve a dispute between parties. It does not involve the use of a Court or Judge.

ENE is a process in which the parties or their counsel present their cases to a neutral third party (usually an experienced and respected lawyer, retired judge or layman with expertise in the substantive area or subject matter of the dispute) who renders a non-binding reasoned evaluation on the merit of the case.

The overriding purpose of ENE is to make litigation less expensive for parties by reducing pre-trial costs and enhancing pre-trial practice. The third-party neutral will give his/her opinion as to the merits of the case, the strengths/weaknesses of each party’s case, what issues each party should be focusing on when doing discovery, what the likelihood of settling would be, etc. The third-party neutral can also give his/her opinion on whom he/she thinks has the better case. Overall, ENE attempts to avoid some of the pitfalls of litigation, such as the failure of lawyers and clients to assess their cases early, the uncommunicative pleadings and unnecessary or unfocused discovery, which lead to unnecessary costs and delays.

What are the benefits of ENE?

ENE is voluntary. It is non-binding on the parties. Each party is free to accept or reject the outcome of the ENE. There is NO judgement or ruling imposed, just the third party’s evaluation.

ENE is informal. There are no fixed evidentiary or procedural rules governing the process. Rather, the parties decide on the governing rules that may be set out in writing in the ENE agreement.

ENE is confidential. ENE is generally a confidential process, unless the parties agree otherwise. The parties should jointly establish the extent of confidentiality in a confidentiality agreement or via a clause in the ENE agreement. If the ENE is confidential, anything discussed during the process cannot be used later in a Court of Law.

ENE provides a third-party’s objective input. The third-party neutral’s role is to objectively identify the main issues in dispute, discusses the strengths and weaknesses of the parties’ arguments, assesses the merits of the claims and renders an opinion on the likely outcome of the case in court. Whenever possible, the neutral helps the parties explore the possibility of a mutually acceptable settlement and may be invited to serve as mediator or facilitator.

What are the disadvantages of ENE?

ENE can be perceived as adding an additional step or layer before getting to court and thus postponing the eventual trial.

Possible overall added costs to litigation if the process does not produce settlement or if the process is pursued in bad faith.

If the third-party neutral finds the opposing party’s case considerably favorable, it could result in the opposing side refusing to settle. The third-party neutral’s decision can be devastating to a party’s case.


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