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Chemical Manufacturing Company V Trader

Date of Claim raised:01/09/2021
Date of Conciliation: 20/09/2021
Date of Settlement: 20/09/2021
Digest: Mediation/Conciliation/Dispute/Claimant/Respondent/Invoice/Settlement
Case Summary

This dispute was between a chemical manufacturing company based in Madhya Pradesh as the Claimant and a trader based in Gujarat as the Respondent. While claimant had supplied materials of a specific dye type to the respondent as they had a working relationship with each other over the past few years, the materials were supplied on a 90-day credit term. The dispute came up when a part of the payment amounting to Rs. 3,09,419/- was not paid even post the credit period.

The Issue

The deal was that the claimant would supply the chemicals of specific specs to the respondent, the order was placed with the purchase order with the particulars and the quantity to be supplied. While the claimant had supplied the materials within the stipulated time period, the respondent denied part of this payment, citing reasons that the specifications to certain parts of the order were not met. Despite several rounds of discussions between the parties, there was no head way, and PrivateCourt was entrusted with the mediation.

The Process

The Mediator studied the documents and established the authenticity of the claim. While discussing the issue with the respondent, what came forth was that the team had overlooked a small nuance in the order, which actually was a clerical error from the side of the respondent in the order form. Somehow, in the whole deal, both the sides had missed out on checking the same, and this, as established by the Mediator, proved that the goods supplied were up to standards, and the onus now lay on the respondent to honour the deal. However, this error also created a loss for the business on the respondent’s side as he could not supply the materials further ahead. Considering these facts, an extended deferred payment term was granted on mutual agreement.

The Settlement Agreement

The Respondent agreed to pay the outstanding amount of Rs. 3,09,419/- by a bank transfer, to be paid on or before April 2022, in 8 monthly instalments.

The Inference

A trained eye of a professional can bring forth what many times people miss in the heat of arguments.