Early neutral evaluation: A practical guide

Mr Justice Akenhead’s recent piece on early neutral evaluation (ENE) provides some useful observations on the advantages of this process (5 November, page 45). Behind the concept of ENE itself lies the thorny matter of exactly what parties are expecting to get from the courts generally. A simple question serves to illustrate the point: are you going to court to get justice or are you going to court to get your dispute resolved?

As reported in the Law Society Gazette on 18 November, Lord Neuberger, the Master of the Rolls, has commented that mediation “cannot be a substitute for justice” and that “if we expand mediation beyond its proper limits as a complement to justice, we run the risk of depriving particular persons or classes of person of their right to equal and impartial justice under the law”. In these words we get a sense of the tensions that exist.

If you are a commercial pragmatist looking for resolution, then ENE may well be for you. Alternatively, as Mr Justice Akenhead suggests, mediation is another option. If, however, you consider the court to be there to provide you with justice, then both ENE and mediation have their limitations. Neither process delivers a full legal answer to the issues put before the court. Each is therefore open to the challenge that it “cannot be a substitute for justice”. Arguably ENE is better in that sense because at least it is concerned with a process of competing legal arguments leading to an evaluation by a judge.

One of the great advantages of mediation is that all parties can maintain they were right: it was just commercially prudent to settle. ENE involves an expression of who is likely to be right

It would be easy to dismiss this as mere academic debate, but there are some real practical issues to think about if you are considering ENE or mediation. For instance, Mr Justice Akenhead comments on a case handled over a three-day period with actual witnesses. In that case, ENE worked, and saved a party the very considerable costs of a full trial. On the other hand, arguably the same result might have been achieved by a one-day mediation. The costs of the three-day ENE process with witnesses would not be inconsiderable and could have been totally wasted if the parties were not willing to agree to accept the evaluation or at least use it as a basis for settlement.

If one or other of the parties really wants justice, as distinct from dispute resolution, then mediation may be unsuitable and a question mark should be put against ENE. If the parties are commercially pragmatic and want dispute resolution, then mediation is now a well-established way forward.

ENE involves handing over that element of control to the judge who gives the evaluation, whereas mediation allows the control to remain with the parties guided and assisted by the mediator. If you are thinking of commercially pragmatic ways to resolve your dispute, it is worth giving this some thought. Do you or the other party, or dare I say it, one of the parties’ advisers need a third party expressing an opinion, such as a judge in ENE, to move from their position? Is that a help or a hindrance? One of the great advantages of mediation is that all parties can maintain they were right: it was just commercially prudent to settle. ENE involves an expression of who is likely to be right.

There are, of course, instances when ENE may be more suitable. Examples I can think of include where there is a point of principle on which judicious guidance will be valuable or where a party will benefit from knowing that a judge is of broadly the same view as his advisers or the other party in relation to a particular issue.

However, in my view, parties would be well advised to think carefully as to whether these drivers are really worth all of the extra cost that can be involved in ENE. Ultimately, the prospect of success in both mediation and ENE depends in part on good advice, in part on the qualities and status of the mediator or judge but in the greater part on the willingness of the parties to seek amicable dispute resolution as distinct from justice.

James Bessey is a partner in the construction department at Cobbetts

This article was originally published under the headline: If it’s justice your after…