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What is Early Neutral Evaluation ("ENE")?

Early Neutral Evaluation (“ENE”) is an alternative dispute resolution process in which a neutral third party, the evaluator, provides the parties with a professional and well-founded assessment of their case. This assessment and the associated proposed solution can be binding or non-binding,

The main purpose of ENE is to provide the parties with an objective perspective on their legal position in order to enable a faster and informed decision on a possible solution or the next steps in choosing the appropriate dispute resolution procedure.

The evaluator is an experienced lawyer, expert or former judge who assesses the case based on the evidence and arguments presented and gives a preliminary, neutral assessment of it:

  • what a solution could look like from his point of view
  • how a court or arbitration tribunal would probably rule,
  • how long the respective procedures could take
  • what costs would be incurred as a result

 

Use cases

Some use cases of Early Neutral Evaluation (ENE) in different contexts:

  • Misallocation of fund assets: An institutional investor accuses a fund manager of violating the investment strategy and investing money in unauthorised asset classes. ENE assesses whether an offence has been committed.
  • Construction contract: Dispute over defects in a construction project. An evaluator assesses the situation and provides an assessment of possible liability issues.
  • Labour law: A dismissed employee sues for unlawful dismissal. A neutral body provides an initial assessment of the likelihood of success of the claim.
  • IT project: A software provider and a customer are in dispute over late delivery. The evaluator analyses the contract and assesses whether there has been a breach of contract.
  • Family law: A couple is arguing about maintenance payments. A neutral person assesses the legal situation and recommends a realistic solution.
  • Trade dispute: Two companies are in dispute over a faulty delivery of goods. A neutral expert gives a prognosis on the chances of success of a lawsuit.
  • Insurance law: A policyholder demands a claim payment, the insurance company refuses. The evaluator provides an objective assessment of the contractual situation.

 

Advantages

One of the greatest advantages of the ENE is the rapid clarification of the legal aspects of a case.

Thanks to the neutral and well-founded assessment of the evaluator, the parties know at an early stage how strong their position would be before a court or arbitration tribunal. This can help to regain lost objectivity and support the parties in developing realistic expectations.

Another advantage of the ENE is the cost savings. The objective evaluation means that lengthy processes and unsuitable forms of dispute resolution can be avoided.

 

Costs

The costs of the ENE are generally lower than in court or arbitration proceedings, as the procedure is shorter and less complex.

The most important cost factor is the evaluator’s fee, which is charged at an hourly rate. In general, the ENE is a cost-effective and sensible introduction to other dispute resolution procedures.

 

Process

The CMCC proposes a carefully selected evaluator, who is usually an experienced lawyer or an expert in a particular field.
The evaluator reviews the documents and evidence submitted and hears the arguments of the parties. Based on this review, the evaluator provides an informed assessment of the strengths and weaknesses of the case and communicates this to the parties.

This assessment can help the parties to set realistic goals for further dispute resolution. In many cases, ENE leads the parties to pursue the case in another appropriate procedure, such as mediation or arbitration.

 

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