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Computer Peripherals Company V Distributor

Date of Claim raised:01/10/2021
Date of Conciliation: 05/10/2021
Date of Settlement: 05/10/2021
Case Summary

This resolution was sought between a computer peripherals company and a distributor, both based in Kolhapur. The Respondent, in this case, the distributor, had ordered goods worth Rs. 75,000/- from the claimant, who in turn agreed to import the materials for the fulfilment of the same. The article in question was about a 3D printer that is used in very specific industries and is not a widely used product. While the delivery time was 30 days, an advance of Rs. 39,012/- was paid. The remaining amount was to be paid on the delivery of the goods in question. The dispute arose when the order was cancelled by the respondent on the 27th day while the article was already en route.

The Issue

The respondent had lost his order; hence, he decided to cancel the order placed with the claimant. The problem was that as it was a very specific product, the cancellation meant that the claimant would incur a huge loss in the deal. The arguments between both parties intensified with no resolution, and PrivateCourt was entrusted with the job of trying to find a resolution.

The Process

The mediator got in touch with the respondent post validating the claims, and what came across was that though an advance was paid, the article in question could not be paid for in full as he had lost his customer. This meant that whoever held the product would make a loss. However, what was explained to them by the mediator was that as they had paid an advance, both parties were making a loss by their inability to complete the deal. What was agreed upon was that the respondent would make sure to sell the article to an alternate client, and the same would be done within 50 days from the date of settlement.

The Settlement Agreement

The Respondent agreed to refund the entire amount of Rs. 35,988/- in two instalments between the 25th and 50th day from the date of settlement, on or before 31st December 2021.

The Inference

Pointing out collective losses often draws parties to an amicable settlement.