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Commercial Litigation and Early Neutral Evaluation

2020: Commercial Litigation Just Became Much More Affordable with Early Neutral Evaluation

The cost of commercial litigation can be prohibitive for companies as well as individuals. In many cases, justice cannot be obtained simply due to the costs associated with legal proceedings. This situation is made worse where one party to litigation is financially stronger than the other. In this article, our commercial litigation specialists look at how Early Neutral Evaluation, a form of Alternative Dispute Resolution, can be used to make the whole process much more affordable.

Alternative Dispute Resolution is Encouraged by the Courts, but Can Increase Costs if it Fails

The courts actively encourage parties to litigation to engage in Alternative Dispute Resolution (ADR) a method of trying to settle disputes without legal proceedings. However, most forms of ADR (for example mediation) do not impress upon the parties the strengths or weaknesses of their case. Accordingly, ADR rather than resulting in settlement and avoiding the costs of lengthy Litigation, only adds to the overall cost if ADR fails and the matter continues to be litigated.

Early Neutral Evaluation (‘ENE’) is a form of ADR which in which parties are told quite clearly who appears to have the stronger case.

What is ENE?

In an ENE, an independent evaluator is appointed by the parties to give an assessment of the merits of their respective cases. The evaluator provides an authoritative view of the issues at the heart of the case and an evaluation of the strength of the evidence.

In effect, the independent evaluator provides an indication as to who they believe has the stronger case and is likely to succeed at trial.

When is ENE Useful?

ENE is useful where:

  • The parties to litigation are significantly apart in their positions.
  • One of the parties has a wholly unrealistic view of their prospects of success.
  • Confidentiality is essential. Unlike a trial, ENE is not public and does not produce any publicly available Judgment or decision.

What are the Advantages of ENE?

  • ENE is far quicker and less expensive than traditional commercial litigation.
  • At an early stage, ENE demonstrates the limitations of each party’s case.
  • Assists in settlement negotiations by persuading parties to view the litigation and the merits of their case more realistically.

ENE and Other Forms of ADR

ENE does not necessarily have to stand alone. Quite often the parties attend an ENE as part of an ongoing ADR process. For example, an initial ENE decision could be given, followed by a mediation.

Having an indication of the strengths and weaknesses of each party’s case can be a powerful tool in obtaining settlement between the parties.

Commercial Litigation is time consuming and expensive and any step which can reduce the time spent and the expense should be welcomed. Obtaining a neutral evaluation at an early stage of litigation (possibly even be before proceedings are issued) can result in a significant saving to all parties.

Cutting the Cost of Commercial Litigation with ENE. Talk to our Commercial Litigation Specialists

Our Commercial Litigation Specialists have extensive experience of Alternative Dispute Resolution, in general, and Early Neutral Evaluation, in particular, with the team being led by Andrew Wylde. If you are involved in a commercial litigation process and are interested in finding out more About ENE, please contact us or call us on 0121 200 7040 for a FREE initial discussion.