ENE Dream Will Do

01 October 2015

A host of case management powers is available to the Court by virtue of CPR 3.1.

This provision is neatly concluded with the catch-all power for the Court to "take any… step or make any… order for the purpose of managing the case and furthering the overriding objective" (CPR 3.1(m)), which, as of today (1 October 2015), will go on to say "including hearing an Early Neutral Evaluation with the aim of helping the parties to settle the case".

Early Neutral Evaluation (ENE) is a form of Alternative Dispute Resolution.  It is a process by which a neutral third party (be it a judge or another third party) considers the strengths and weaknesses of parties' cases at that point in time in order to arrive at an informal assessment of the potential outcome, albeit it can take a number of forms.  It is not binding, but affords a platform on which the parties may attempt to procure settlement. 

ENE, whose genesis was in the District Court of Northern California in the late 1980s, has previously made the journey over to the Courts of England and Wales, but has hardly taken off.  Some commentators have dismissed it as a tactical means of avoiding a particular Judge, an unwanted further cost beyond the already extensive case management necessities or an instrument that is only suitable for certain sorts of cases.  Traditionally, ENE has been a creature of the Family, Technology and Construction, or Admiralty and Commercial Courts, the guides for which state that ENE may be conducted with the consent of all parties.

Nevertheless ENE has recently found favour.  In the case of Seals and Seals v Williams [2015] EWHC 1829 (Ch) - a claim brought pursuant to the Inheritance Act 1833 in May this year - Norris J commended the parties for suggesting ENE over mediation because it allows judges the opportunity to evaluate the parties' cases in a direct manner and to provide an authoritative view on the legal issues at the heart of the case. He noted that the process would be particularly useful where the parties have different views on the prospect of success and an inadequate understanding of the risks of litigation.  The Pre-Action Protocol for Professional Negligence endorses ENE (at paragraph 12 on Alternative Dispute Resolution) and the CPR Committee noted in June 2015 that ENE provides "a further opportunity for early settlement, thus freeing up court resources".

ENE should be considered as a means to compliment swift dispute resolution, rather than being treated as a preferable process to, say, mediation, adjudication or expert determination. It is almost certain to be cheaper than these methods and does away with the partisan approach that precipitates many a deadlock in mediations. Given that it is not binding however, the impetus is still on the parties to resolve a dispute after ENE.  As Norris J commented, the ambit of issues in dispute will be narrowed and/or clarified, and certain wayward allegations and/or points of defence can be ironed out at an early phase to prevent costs escalating unnecessarily. If there is a downside, it could be that ENE could focus on the legal issues too greatly while detracting from commercial considerations, which is not true of mediation. There is nevertheless nothing to stop ENE being explored in tandem with other forms of dispute resolution and, for that reason, in principle, the advantages seem to outweigh the downsides.

The vague wording merits thought; since the provision does not state otherwise, the

suggestion is that a Judge could theoretically impose ENE on the parties, whereas it has previously been seen as a voluntary process.  It could well be that Judges start to become more forthright about their opinions on cases from the word go (i.e. at the first Case Management Conference).  ENE's introduction is undoubtedly for the right reasons.  It provides a further option for ensuring that costs do not escalate disproportionately.  It will be interesting to see how significant a role it performs and the form that it takes.

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