Early Neutral Evaluation – Part 1: What, why and how it works
Early Neutral Evaluation is a process used in some divorce cases to help separating couples reach an agreement on financial issues. It is based on the formal court process where – after there has been full financial disclosure and there is a good understanding of the financial circumstances and overall issues in the case – there is what is called a Financial Dispute Resolution hearing (often referred to as an FDR).
At an FDR a judge gives an indication as to the likely outcome of the case to try and help the spouses negotiate an agreement. An Early Neutral Evaluation (also known as a ‘Private FDR’) is the same except that the evaluator is not a judge, but a trusted third party legal professional who has been appointed by both spouses to conduct the evaluation of their case to try and help them settle their dispute.
Financial Dispute Resolution hearings (with a judge) are, in theory, an excellent concept, as they encourage and assist spouses to negotiate a settlement that they can both live with rather than having an outcome imposed on them following an expensive and stressful trial. However, in reality, FDRs are often not as effective as they could be due to the limited resources available within the court system.
For example, it can often take months to get an FDR hearing listed, sometimes the hearing can be cancelled at the last minute due to lack of judicial availability and if it does go ahead the judge on the day may not have sufficient time to deal with your case. It is for this reason that more and more people are now turning to Early Neutral Evaluation.
Early Neutral Evaluation has had support from the judiciary. On his last day in office as President of the Family Division, Sir James Munby expressed his support by saying:
“I hope that the lead and other judges will take the opportunity to develop and encourage the use of ‘private’ FDRs locally. A private FDR is a simple concept. The parties pay for a financial remedy specialist to act as a private FDR judge. That person may be a solicitor, barrister or retired judge. No additional qualifications are required. The private FDR takes place at a time convenient to the parties, usually in solicitors’ offices or barristers’ chambers, and a full-day is normally set aside to maximise the prospects of settlement. It takes the place of the in-court FDR.”
At the same time the pressures on the family courts were acknowledged with Sir James Munby noting that ‘At present, demand on court resources has led to instances of over-listing of FDRs. A high settlement success rate is not likely to be achieved if the district judge’s list for the day has more than five FDRs in it. This has the inevitable knock-on of far more cases being listed for a final hearing than should be so – a classic example of the law of diminishing returns.’
The concept of Early Neutral Evaluation is in effect the same as the court FDR hearing. The key difference is that it takes place outside of the formal court process and the spouses instruct an independent legal professional, often referred to as the ‘judge’ but technically they are the ‘evaluator’ to review their case and give them an indication of the likely outcome to assist spouses to reach a settlement.
The spouses can choose who to instruct to be the evaluator for their case. This could be any of the following who have a specialism in family law financial remedy cases: a barrister, a solicitor, a chartered legal executive or retired judge. The legal professional they choose may also be an arbitrator or judge themselves and although for the purposes of the Early Neutral Evaluation they will not be acting in that capacity, they will have the background expertise in determining cases.
The legal professional may also be trained in mediation and/or the collaborative process and therefore have additional skills that they can bring to assisting the negotiation process. If you and your spouse have a direct involvement in the choice of who is being instructed it can help build confidence in the indication that will be given which in turn can help the negotiation process.
A mutually convenient date and time for the Early Neutral Evaluation can be organised, which can have a significant advantage compared to the long wait you are likely to have for a court listed FDR. Usually, a whole day is set aside for the Early Neutral Evaluation, whereas at court there may only be a few hours available. The location can also be worked out so that it is convenient for all, usually, it takes place at a solicitor’s office or barrister’s chambers. Arrangements can also easily be made for the process to be dealt with remotely using an online video conferencing platform such as Zoom or Skype.
The evaluator on the day will just be there to deal with your case. There will have been plenty of opportunities for all the papers to have been read and considered. As well as providing an indication the evaluator can also get actively involved in trying to broker the deal if necessary to try and assist the spouses to reach an agreement. The Early Neutral Evaluation forum can also be an extremely valuable sounding board where there are factual issues in dispute.
As with the formal court FDR, an Early Neutral Evaluation is ‘without prejudice’. Evidence of anything said or any admission made in the course of the Early Neutral Evaluation will not be admissible in evidence at trial if a settlement can’t be reached (except for in some specific exceptional circumstances). Simply put, neither spouse will be held to the negotiations nor indication given unless an agreement is reached. This creates a safe space for discussions to be had, to explore options, without the fear that they will be used against you if the case can’t settle and goes to trial. If an agreement can be reached then it can be drawn up as a consent order, often on the day, signed and sent to the court for approval to legally finalise matters.
There will, of course, be a fee for the instruction of the evaluator for an Early Neutral Evaluation. However, this can in some cases end up being more cost-effective overall compared to the court system. The fact that the spouses are investing financially into the process often means they take it more seriously.
As we have seen above, one of the key benefits of Early Neutral Evaluation is that it takes place away from the court. In part two of this blog I will go into further detail about the benefits of Early Neutral Evaluation compared to the court process.
Our team of specialist family lawyers are able to help with Early Neutral Evaluation, either offering either legal representation or indeed acting as an evaluator. In particular one of our Founding Directors, Robert Williams, is a qualified arbitrator, collaborative lawyer and district judge and therefore his skillset and specialist training means that he is perfectly placed to be appointed as an evaluator to assist separating couples who have decided that Early Neutral Evaluation is a process that is right for them and their case.
Please contact us for a confidential discussion with one of our experts.