Early Neutral Evaluation ("ENE") and mediation are two forms of Alternative Dispute Resolution ("ADR") that can be deployed by parties to resolve commercial disputes, either outside of or alongside Court proceedings or arbitration proceedings.
ENE and mediation share a number of similarities – both processes are private, without prejudice (so cannot be used as evidence in Court proceedings) and non-binding. They will consider the commercial issues and risks of any dispute, and place the management of the dispute within the control of the parties. Each process offers an alternative to Court proceedings which can serve to limit the parties’ costs, and may enable an earlier resolution than litigation or arbitration.
The key difference is the role of the evaluator or mediator: a mediator will not impose his or her views on the parties, focussing instead on trying to facilitate an agreement between them, whereas the evaluator’s role is to provide a considered view on the issues submitted to him or her. Whilst the opinion of the evaluator might provide a greater incentive for the parties to find agreement, the evaluator will play no part in actually facilitating any agreement. Neither will he or she give a binding decision on the legal issues or advocate a way of resolving the matter. Mediation could still therefore follow an ENE, and many ENE agreements will include provision for a post-ENE mediation or settlement meeting.
Whilst ENE may arguably add a further "layer" of ADR (and associated costs and delay) - it can be a very useful tool in particular circumstances. For example, where there is a significant disparity between the parties’ positions, where the parties have reached an impasse and/ or where one party has an unrealistic view of the case. In these circumstances an unbiased, neutral view of the likely outcome if the matter were to proceed to trial may serve to break the deadlock and encourage settlement. ENE does, however, risk undermining the negotiating position of the "losing" party and/or strengthening the "winner’s" resolve, which can serve to make settlement more difficult.
If you require help to address a commercial dispute, our Dispute Resolution team can advise on the options available to you. We understand that avoiding, rather than encouraging, conflict usually delivers a better outcome for our clients and we will always advise on the most appropriate, pragmatic forums for seeking to resolve a dispute.