Minnesota courts have implemented a system to help divorcing parties resolve financial issues through a process called “Financial Early Neutral Evaluation”.  This process has resulted in settlements in a significant number of cases and therefore presents an important opportunity early on in the divorce process to resolve difficult financial issues.

An FENE is usually a 3 to 4 hour session with a court appointed neutral who is either an experienced family law lawyer or a CPA.  The neutral will meet with both parties and their lawyers.  The process begins with an exchange of information including income, assets and liabilities.  Creation of a balance sheet takes some time and frequently involves discussion concerning valuation techniques for particular assets.  Once the balance sheet is completed, the cumulative value is divided equally except in unusual circumstances.  The FENE process can also address the issue of child support and/or spousal maintenance.  In most cases, child support is relatively easy to calculate.  However, spousal maintenance tends to be more controversial and involves the incomes or income potential of both parties as well as their respective budgets projected for after the dissolution process is concluded.  Various options are discussed, including the process by which a judge will likely evaluate and determine the issue of the amount and duration of spousal maintenance.

The relative success of the FENE process can be attributed to one or more of  the following reasons:

1.         The neutral tends to facilitate a conversation that eventually becomes more comfortable for both parties.

2.         Issues are fully discussed without regard to rules of evidence or other protocols that can otherwise complicate the process.

3.         The process is generally less emotional because both parties understand that they are trying to achieve a settlement as expeditiously and efficiently as possible, and because both parties realize that, in the event they do not reach an agreement, the process is confidential and does not bind them in any way.

4.         In the best circumstances, the evaluators rather than the lawyers control the agenda.  Lawyers help provide relevant information to the evaluators, and help point out important facts that have an impact on how an issue may be resolved.  Otherwise, the conversation tends to involve more the parties and the evaluator.

5.         A good evaluator builds credibility with the parties, so that both tend to gain confidence in the opinion of the evaluator, and that helps guide the litigants to a resolution.

6.         Most evaluators have a way to demonstrate their opinions in a quantative manner.  For example, power point presentations or the assistance of a laptop facilitates the creation of balance sheets and spreadsheets that illustrate the points that the evaluator is trying to make or the information that the parties are gathering and presenting.  There is a direct connection between the issues and information that is being discussed, the opinion shared, and illustrations that can be developed throughout the meeting.