ENE is a method or tool within the larger context of Alternative Dispute Resolution. For an excellent dissertation, I refer you to www.library.findlaw.com for an article by John S Blackman entitled “Early Neutral Evaluation – An ADR Technique Whose Time Has Come”.
In the context of construction disputes arising under SB 800; Calderon; NRS chapter 40; Warranty claims and backcharges; or disputed contribution under insurance WRAP-UP policies, an “early” and “neutral” evaluation by an objective third party with relavent experience, should prove highly effective – if not to resolve the dispute, then to quickly posture the matter for meaningful negotiations.
A well reasoned ENE overcomes the endemic distrust that typically exists between and among developer / general contractors, subcontractors, and owners. The “neutral” analysis of the claims and defenses supplants the biased assignment of blame more often imposed by the party with the greater bargaining strength.
Like an express contractual requirement to arbitrate or mediate prior to litigation, a similiar contractual referral to an “Early Neutral Evaluation” will help to create the requisite dialogue and should ulitmately secure desired resolution short of the long and costly litigation process.
We are working to facilitate on-line submittals for ENE. Please, give us your thoughts. MHardy
January 14, 2008 at 10:04 pm
What kind of language could I put in my clients contract to make the ene a prefiling requirement to any lawsuit filed both in subcontracts and contracts with property owners?
January 30, 2008 at 11:30 pm
CC 912 imposes a host of requirements on the builder to supply documents; to give notice of requisite claim filing procedures; and to identify the agent for notice or third party to accept claims. The buyer’s notice of claim then starts the pre-litigation process.
The sales agreement could easily identify Greenfiled Hardy as the “third party” designated to accept – and to evaluate- the claim. The builder could, by express language, simply agree to submit the matter for “neutral” evaluation. With the notification provisions, the sales contract could add a provision to the effect:
“Buyer agrees to provide notice of claims and to submit all claims related to the supply, manufacture, and construction of the home, to Greenfield Hardy for Early Neutral Evaluation. Builder and Buyer agree to cooperate fully in the claims’ filing process and agree that the evaluation to be provided is “neutral”. In the event that the “neutral’ evaluation is unacceptable – for any reason- the parties agree to pursue mediation (or to submit the matter to binding arbitration). Failure, by any party, to mediate prior to filing suit will forfeit that party’s entitlement to attorneys fees, if any, under the terms of this contract.”
Similiar language could be used effectively in the subcontact agreements and in broader based construction claims – not just those brought under SB 800. In particular, subcontractors should insist on language that provides for them a truly “neutral” evaluation under warranty, for backcharges, or under SB 800 and Calderon. The Builder will want to ensure the participation of the subs in the ENE process described in his or her contract with the Buyer.