Book Review of Early Neutral Evaluation

Vol. 20 No. 4

By

Full disclosure: I came close to embarrassing Wayne Brazil almost 30 years ago. I was following him to the podium at a symposium on the then-new topic of court-annexed mediation. Having started the mediation program for the US Court of Appeals for the Sixth Circuit a few years earlier and become a true believer, I had come to proselytize to what I expected to be a skeptical audience. Brazil gave such a deeply thoughtful and credible explanation of the merits of court mediation that as we passed on the dais, it took all my willpower not to grab and hug him. 

Over the last three decades, few have given as much sincere thought to the merits, risks and best practices of court ADR, and even fewer have expressed those ideas with as much intellectual passion, thoroughness and clarity, as Wayne Brazil. This book is one more example.

Brazil ambitiously proposes this book for “lawyers, litigants, neutrals, judges, court program administrators and public policy analysts” and, remarkably, offers real value to each. In 206 pages (with appendices), former magistrate-judge Brazil recounts the history of Early Neutral Evaluation (ENE) in the US District Court for the Northern District of California starting in the 1980s. He explains when and how litigants, lawyers and courts can maximize the opportunities offered by this unique ADR procedure. He offers advice, procedures and forms to evaluators, 15 specific “practice tips” to lawyers and practical advice to clients on how to use ENE to their full advantage. From blunt admonition for evaluators to follow the rules to nuanced observations on how they can win credibility with lawyers and reflect well on the integrity of the courts, no perspective is unaddressed.

Even the claim that Early Neutral Evaluation was “invented” by the Northern District of California, a claim this reviewer has grown accustomed to hearing about nearly all forms and aspects of ADR, is justified by the precise consideration Brazil gives to distinguishing the functions of ENE from those of mediation. Perhaps more exactingly defined by rule than followed in practice, the rigorous segregation of the neutral’s roles as evaluator vs. mediator nobly aims to protect the values, improve the effectiveness and honor the promises of both ENE and mediation. 

ENE in the Northern District of California

In a nutshell, ENE in the Northern District is presented as a confidential, informal procedure offered by the Court to civil litigants at no charge to assist them in reducing the time and cost of litigation. The procedure clarifies and focuses litigants’ issues, streamlines discovery and presentation of the case to the Court (if necessary), and rationally explores bases for settlement. A judge or volunteer lawyer with expertise in the subject matter of the dispute as well as training in both ENE and mediation typically serves as the neutral evaluator. 

The procedure starts with a Pre-session Conference in which lead counsel and the evaluator review expectations, agree on the content of formal statements and the exchange of information, possibly to include more discovery, and set the ENE Session date. 

The ENE Session is attended by counsel and clients and other critical stakeholders. Following the evaluator’s introductions, parties make uninterrupted substantive presentations of their disputed issues, arguments and evidence. Responsive presentations by the parties and clarifying questions by the evaluator follow until differences are clear and the most important disputed issues of fact and law are identified. 

On the next step, Judge Brazil is emphatic: Following full explication of the issues and arguments, and before discussing the option of mediation, the evaluator “retreats to her private office to draft the evaluation.” The parties can opt to have the evaluation presented on paper, read to the parties or withheld pending settlement discussions. However, the evaluation must be reduced to writing before any settlement talks begin. Brazil insists on fulfilling the Court’s promise to deliver an objective, reasoned opinion on the merits of the case and to maintain an intellectual honesty in the process by which that opinion is formed.

His insistence on reducing the evaluation to writing helps secure what can easily become a meandering boundary between ENE and mediation. Up to this point all presentations and inquiry have occurred with full transparency and no ex parte communications, and the neutral’s role has been limited strictly to clarifying the merits of the parties’ legal positions. More like an informal arbitration or mini-trial than a mediation, this ENE is a process in which the neutral does not explore parties’ motives or underlying interests before writing her opinion.

This is not to say there cannot be flexibility in the content of the opinion or the way it is presented. The subjects, clarity, and strength of the evaluator’s opinion will necessarily be influenced by the stage of discovery, the status of rulings on claims and defenses and the relative clarity of governing law as well as other variables. In fact, Brazil suggests the evaluator and counsel talk early about just what kind of evaluation will most benefit the parties. It might focus, for example, on “individual claims or individual defenses, how a particular legal doctrine might be construed by the court and applied to the case at bar, the probative power of specified evidence, the relative credibility of competing percipient testimony, the jury appeal of the parties’ competing story lines, the relative strength of lines of reasoning by competing experts, or the range of value a jury might attach to general damages.” The evaluation could assess judgment value (the likely amount of the judgment should one be rendered), or it could focus on settlement value (to include compromises based on estimates of likely success or failure of relevant issues, even those not included in the parties’ presentations). As always, Brazil proposes serving the needs of the parties, preserving intellectual integrity and maintaining transparency as the governing criteria for making these choices. 

Once the opinion has been written, the parties are given the option of engaging in mediation. The parties in 60 percent of cases in the Northern District choose to do so. If any party elects to see the evaluation before mediation, it must be presented to all parties. If not, the evaluator holds the opinion without further modification and switches roles.

Ethical Issues in Transition from Evaluation to Mediation

This transition from evaluation to mediation poses several tricky ethical issues for Brazil. The ENE evaluator in the Northern District is prohibited from “…urging or encouraging or pressuring” parties to mediate. If the parties decide to mediate, the evaluator-turned-mediator must offer format options, including mediation with and without caucusing. If the parties choose mediation prior to presentation of the evaluation, the neutral must serve in a purely facilitative role. As Judge Brazil explains,

She may offer no evaluative feedback and no analytical help, even indirectly – for example, in the way she reacts (verbally, by facial expression, or by body language) to things litigants say or do during the mediated process. She must take care not to betray her substantive views in the ways she poses questions, or even by encouraging parties to look more closely at particular evidence or issues.

Brazil views any hint of an opinion about settlement terms that might flow from the earlier ENE process as clearly improper and damaging to the integrity of the Court. Though there are few topics on which he expresses as strong an opinion, I had trouble understanding this particular ethical concern. I see how disclosing an opinion formed from the ENE process to only one party in a caucus might be seen as a betrayal of the parties’ mutual agreement to waive presentation of the opinion until after settlement talks are finished. And certainly if the evaluator had any power to influence the outcome of the litigation, disclosure to only one party could create an advantage that would be clearly improper. An evaluator in the confidential process Brazil describes, however, has no more power than a traditional mediator to affect the case on its merits. Once the transition is made, why should the behavior of the evaluator-turned-mediator be any more ethically circumscribed than that of a traditional mediator who meets with parties in caucus where she gains insights, forms opinions and coaches the parties in negotiations? To exclude as unethical all hints of opinion as to the wisdom or merits of parties’ settlement positions in mediation is to limit important contributions mediators can make and that parties often want.

I assume the principal reason Brazil does not simply require that a different neutral conduct the mediation is the time and expense involved in bringing a new person up to speed. Some litigants might be less likely to choose mediation if it means starting over. Presumably, they could have chosen mediation to start with but preferred the more rigorous path of developing a detailed understanding of the legal merits of their case. Having once done so however, the advantages of sticking with the ENE evaluator include not just the confidence and credibility she has developed with the parties but her familiarity with the dynamics of the case, including the issues, arguments, evidence, and the merits thereof.

Brazil wisely counsels evaluators-turned-mediators to avoid becoming invested in their opinions. When parties feel a mediator has developed an ego investment in or has become an advocate for a particular position or outcome, the mediator’s perceived neutrality and in some cases effectiveness can be compromised. This can be hard to avoid if the parties chose to hear the evaluation before starting settlement talks. Neutrals need to be able to provide parties feedback on the wisdom or merits of the parties’ settlement positions. The pitfall for neutrals is considering their opinion as the “right” way that the dispute should be resolved. Neutrals need to resist the temptation to push the parties toward a settlement that mirrors the written opinion and instead allow the parties to use the neutrals’ feedback in a way to find their own resolution.

Judge Brazil tackles for the ENE evaluator another ethical dilemma that mediators have struggled with for decades: what to do with independent personal knowledge that could significantly affect the merits or likely outcome of the case. In a “Practice Tip,” he suggests to practitioners that they decide and communicate to the evaluator in advance what they want her to do if she thinks of a claim, defense, legal theory or pertinent case that neither party has raised. But what if there are no instructive directives from the parties or the sponsoring court? Again, Brazil distinguishes ENE from mediation in which parties expect leeway to find their own solutions. He advises that in the absence of prior instruction, reasonable party expectations, clear local culture or other contextual factors, evaluators are there to offer their expert opinions and would be shirking their responsibilities not to do so. His regard and expectations for this unique role are high. He notes this “quasi-judicial” role goes even farther than the role of a judge, since a trial judge isn’t expected to articulate the relative strengths and weaknesses of parties’ positions, how the plaintiff might meet his burden of proof if he explored additional sources of evidence, or how evidence might be presented more effectively. An evaluator, to fairly qualify an opinion based on tentative information, may have to do any or all those things.

The Value of ENE

I admit I have been somewhat skeptical of the viability of ENE as a productive form of ADR. On several occasions, while mediating with good lawyers in high-stakes cases with pivotal technical legal issues, I convinced the parties to invest in an outside expert opinion from someone whom all sides trusted and respected. In each case, the lawyer against whose side the expert opined could not let go of his convictions. In the end, they maintained their own opinions over the experts’ and would yield little. It eventually became my practice as a mediator, when counsel asked me to read their briefs and say what I thought of their case, to ask them first to consider honestly how their settlement position would be affected if I found particular arguments of their opponents persuasive. When pressed with specific scenarios, they almost always conceded their position would not change. What they really wanted was a credible opinion that agreed with theirs. Admittedly, the appellate context in which I worked may not offer a fair comparison, since by the appellate stage lawyers are more deeply steeped in their arguments and less likely to be influenced by others. 

Despite the careful crafting, enumerated benefits and long history of ENE in the Northern District, like arbitration it has been surpassed in popularity there and throughout the country by mediation. Brazil discusses this candidly, suggesting that lawyers might pick mediation more often because it is familiar and more flexible or because it is “…visible, readily available, fashionable, and easy to sell to clients. Moreover, mediation appears to the superficial eye to be the least demanding, least threatening, and most manageable or manipulable form of ADR.” Some, he suggests, might “…believe that it is easier to disguise a weaker case in mediation than in some other types of ADR. In sharp contrast,” he notes, “ENE, at least as it has evolved in the Northern District of California, is less flexible in form…and less amenable to adjustments to cater to the emotional, informational, or situational needs of litigants and lawyers.”

Brazil catalogues the problems ENE seeks to address and the benefits it offers over other ADR forms, particularly mediation. Real distinctions seem limited, however, due in part to the way most court mediation is practiced. First, court mediation typically occurs early in the case, so opportunities to assess and focus issues for discovery and briefing can save litigants time and money if they are so inclined. Also, clients in both programs can hear their beliefs and their lawyers’ arguments tested, and both programs, when initiated by the court, open settlement discussion without either party having to propose it first. Finally, purely facilitative mediation, in which the neutral gives no hint of personal opinion is, I believe, rare. Just as ENE evaluators end up offering to mediate, most mediators subtly or not so subtly end up offering agent-of-reality advice on the merits of legal arguments and the settlement positions they spawn. Nearly all court-based litigation mediators are lawyers, and most are very experienced ones. To expect any but the most disciplined neutrals to not offer what they think parties need to solve their problem, which sometimes includes a nudge toward a more realistic appraisal of their position, is probably unrealistic…and arguably unnecessary.

What ENE as Brazil describes it does uniquely offer, for those with the courage to invite it, is a competent, unambiguous, transparent, informed third-party opinion on the merits of whatever questions the parties submit. For parties whose goal is to reach for compromise solutions that fairly match the merits of their factual and legal positions and for lawyers who are confident they can address any weakness in the case that the process or the neutral might uncover, ENE can be an excellent tool.

Robert Rack served as Chief Circuit Mediator for the US Court of Appeals for the Sixth Circuit from 1981 to 2011. He has assisted in the design and implementation of mediation programs in state and federal courts in the United States as well as in Asia and the Middle East. He is co-founder and president of Beyond Civility: Communication for Effective Governance and compulsively plants trees. He can be reached at rack47@gmail.com.

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