What is the difference between Early Neutral Evaluation and Mediation?
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 with expertise in the substantive area 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.
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.
What are the benefits of Mediation?
The other type of ADR is Mediation. Mediation involves a third party neutral, the mediator, who assists both parties in negotiating a settlement. In essence, mediation brings disputing parties together to explore their understanding of the conflicts and to help both parties decide on a resolution. What are the benefits of Mediation?
There are many benefits to parties selecting mediation. However, the two primary benefits of mediation are time and money.
First, mediation can result in a faster resolution of the dispute. Mediation allows both parties to lay out their issues and start negotiating immediately. It doesn’t require going through the court system, which can be extremely lengthy. If both parties are reasonable, then mediation can result in a fast and quick settlement.
Second, mediation can also be cost efficient. Litigation can be costly. While mediation costs vary, it is most likely going to be cheaper than the expense of litigation.
Mediation can be a valuable tool to use in order to resolve a dispute in a timely and cost efficient manner. However, mediation is not appropriate for every case.