City barrister Professor Mark Watson-Gandy explains about early neutral evaluation


ENE questions

Business Money talks to City barrister Professor Mark Watson-Gandy about early neutral evaluation           

Q) So, early neutral evaluation. What’s that then?

A) It’s a form of alternative dispute resolution, and it’s something you’ll be hearing a lot more about in the courts from now on. Norris J in Seals v Williams [2015] explained ENE thus: As part of the settlement process, a judge is appointed to evaluate the respective parties’ cases in a direct way and may well provide an authoritative – albeit provisional – view of the legal issues at the heart of the case and an experienced evaluation of the strength of the evidence available to deploy in addressing those legal issues.

Q) In other words?

A)You get a non-binding steer from a different judge as to how he thinks the case will pan out at trial.

Q) When is it useful?

A) As Norris J explained in Seals v Williams [2015], the process is useful where the parties have very differing views of the prospect of success and perhaps an inadequate understanding of the risks of litigation itself. 

Q) What were the facts in that case?

A) In Seals v Williams [2015] the claim had generated a great deal of acrimony, and the positions of the parties were in danger of becoming entrenched. An attempt at mediation largely stalled because of differing perceptions of the issues in dispute and of the strength of the respective arguments. Basically, each party was labouring under the impression that they would almost certainly win at trial. 

Q) So why is this a big issue?

A) From 1 October, the Civil Procedure (Amendment) Rules 2015 introduce a new provision at CPR 3.1(2)(m), stating that: “Except where these rules provide otherwise, the court may take any step or make any other order for the purpose of managing the case and furthering the overriding objective, including hearing an ENE with the aim of helping the parties settle the case.”

Q) What does that mean?

A) The judge will now have powers to impose early neutral evaluation in any cases where he thinks it would be appropriate. It applies to all types of court cases.

Q) Is this something new?

A) No. It was pioneered in California in the 1980s, and they have had it for some years in family cases. The guides for the technology and construction court and commercial court both refer to it, but there had been doubts over the court’s powers to order it: Bovale v Secretary of State [2009]. Now it is formally part of the court’s powers for all cases.

Q) How has it worked in the past?

A) If a judge considers that it is appropriate he will give such directions for its conduct as he thinks are appropriate. How ENE is achieved is a matter of considerable flexibility. The general idea is that the court will provide a without-prejudice, non-binding assessment and the judge who conducts the ENE will usually take no further part in the case, unless the parties agree. An ENE may be conducted entirely on paper or after a hearing, with or without evidence, although in general such hearings will not be expected to last more than one day. The judge conducting the ENE will give his conclusion with brief reasons, but this may be done either orally or in writing.

Q) What sort of directions might be given for an ENE?

A) Things you might wish to address include the following:

- A stay of the substantive proceedings while the ENE is carried out.

- Directions that the ENE is to be carried out entirely on paper, with dates for the exchange of submissions, or that there will be an oral hearing, either with or without evidence, with dates for submissions, witness statements and expert evidence needed for that hearing. If there is an oral hearing the ENE will generally not last more than one day.

- Directions that particular documents or info should be provided by a party.

- A statement whether the ENE and the documents, submissions or evidence produced are to be without prejudice, or whether all or part of them can be referred to at any subsequent hearing.

- A statement whether the parties agree that the judge’s evaluation after the ENE process will be binding on the parties or not. Whilst the idea behind ENE is that it is merely a steer, the parties can choose that the ruling when made will be binding in all or only certain circumstances, or temporarily binding subject to a final decision or agreement.

Questions for Counsel’s Opinion should be e-mailed to:

Professor Mark Watson-Gandy is a barrister at The Chambers of John McDonnell QC, 13 Old Square, Lincoln’s Inn, London WC2A 3UA

Tel: +44 (0) 20 7831 4445 Fax: +44 (0) 20 7841 5825