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Neutral Evaluation, also known as Early Neutral Evaluation is an advisory and evaluative form of alternative dispute resolution. Neutral evaluation is a process wherein a neutral third party hears the presentations of the disputants, and then provides his opinion regarding the dispute. The neutral third party evaluates the facts, circumstances, and issues of the case, and then renders an insight about the case. In most cases, the evaluator has special knowledge about the subject- matter of the dispute, this makes the evaluation more effective and reliable. The opinion of the neutral third party is non- binding.

Although neutral evaluation can occur at any stage of the dispute, it is the most effective when employed at the early stage. If it is employed at the pre-litigation stage, the parties may get an insight about what should be expected out of litigation, this is because in most cases the neutral appointed is a senior lawyer or a person from a legal background. This assists the parties in resolving most of their disputes. This is a very effective way of reducing litigation costs as most of the disputes can be resolved through early neutral evaluation.

Litigation is a very cumbersome and lengthy process; it is not a suitable alternative if parties require a speedy redressal of their dispute. Meanwhile, early neutral evaluation is a relatively quick process and if successful, the parties can avoid the extensive litigation process altogether.  

It is a well-established fact that the Judges appointed in courts may not have special knowledge in the subject-matter of the litigation. Contrary to this, the parties have the discretion to appoint an evaluator who is aware of the technicalities relating to the area of dispute. This ensures that all the issues relating to the dispute are completely analyzed and evaluated. In certain cases, the courts refer the parties to neutral resolution so that the issues of the dispute can be evaluated in a much proper manner. This procedure also gives an opportunity to the disputants to revaluate their own cases and revise their proposals, which might lead to an early settlement between the parties.  

The procedure under neutral evaluation is confidential and impartial. The evaluator ensures that the information shared by the parties remains undisclosed. The parties are also required to maintain confidentiality. This assurance encourages the parties to reveal issues that concern them. The parties may also reveal important information relating to the case, which they might have been hesitant in disclosing. It also encourages and promotes proper communication between the parties about their claims. This might be a key to settling the dispute.

The early neutral evaluation also reduces the risk of choosing inappropriate dispute resolution methods. Often parties resort to dispute resolution mechanisms that are not best suited for resolving their disputes. If parties resort to neutral evaluation, they gain an opportunity to explore all kinds of dispute resolution mechanisms and then decide the one that is most appropriate for resolving their conflict. 

Thus, it can be concluded that early neutral evaluation may prove to be an effective way of resolving disputes.

  • Neutral evaluation
  • Cost effective procedure
  • Discretion to appoint the evluator

BY : Riddhika Somani

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