CaseStudy

Case Summary

In the year 2012, Furnishing Private Limited was established as a leading manufacturer, supplier, and exporter of various types of curtain fabrics, including Jacquard Curtain Fabric, Mosi Curtain Fabric, and Cotton Curtain Fabric. Based out of Vasai, Thane, they quickly gained a reputation for their premium-quality collection of curtains.

A dispute arose when Furnishing Private Limited found themselves entangled in a non-payment issue with a furnishing house based in Bihar. The Respondent, a customer of Furnishing Private Limited, had failed to make a payment of the disputed amount, which totaled Rs. 2,00,000/-. This non-payment became a cause of concern for Furnishing Private Limited, as it significantly impacted their cash flow and hindered their ability to conduct business smoothly.

However, despite Furnishing Private Limited's diligent efforts, the Respondent failed to fulfill their payment obligations. This led to frustration and financial strain for the Claimant. Recognizing the need to resolve the dispute and recover the outstanding amount,the Claimant decided to seek the assistance of PrivateCourt, to facilitate the settlement process.

The Issue

The dispute between the Claimant and the Respondent in Bihar arose when the Respondent failed to make the payment of the disputed amount. The Claimant had provided the Respondent with high-quality Jacquard Curtain Fabric, Mosi Curtain Fabric, and Cotton Curtain Fabric as per the agreed terms. However, despite the satisfactory delivery of the goods, the Respondent neglected to fulfill their payment obligations.

The Claimant made repeated demands for payment, providing evidence of the delivery and the agreed-upon amount. The Respondent, on the other hand, claimed that they had faced financial difficulties due to unforeseen circumstances and were unable to make the payment in full. They expressed willingness to settle the dispute, but required a structured payment plan.

More factors that contributed to the dispute between Furnishing Private Limited and the furnishing house in Bihar:

• Miscommunication regarding payment terms: One of the key issues that led to the dispute was a miscommunication or misunderstanding between the parties regarding the payment terms. It is possible that the terms and conditions for payment were not clearly defined or agreed upon in the initial agreement. This lack of clarity may have caused confusion and disagreement when it came to fulfilling the payment obligations.
• Financial difficulties faced by the Respondent: The Respondent claimed to have faced financial difficulties due to unforeseen circumstances. It is possible that they encountered unexpected challenges or a downturn in their business, which made it difficult for them to fulfill their financial obligations. This financial strain may have resulted in the delayed or non-payment of the disputed amount.
• Failure to resolve the dispute independently: Prior to approaching PrivateCourt, the Claimant attempted to resolve the dispute with the Respondent directly, but their efforts were unsuccessful.

The PrivateCourt Proceedings:

PrivateCourt, known for its expertise in resolving disputes through ADR methods, took charge of the case. The PrivateCourt team diligently requested and examined all relevant documents from both parties. Following the established protocol, the team ensured a fair and unbiased approach in understanding the dispute.

The lead Sole Conciliator from PrivateCourt scheduled a Conciliation via Zoom and audio calls conference as per the Notice of Conciliation. However, during discussions with the PrivateCourt team, the Respondent expressed their desire to settle the issues by paying the the claim amount on or before July 2023 in instalments. This development indicated a positive inclination towards resolution and highlighted the effectiveness of PrivateCourt's intervention.

The Settlement Agreement:

To formalise the settlement between the Claimant and the Respondent, a settlement agreement was drafted. According to the agreement, the Respondent agreed to pay the disputed amount in six instalments, starting from February 2023 and ending in July 2023. The first five instalments were set at Rs. 33,000/- each, with the final instalment amounting to Rs. 35,000/-. The Respondent committed to making these payments to the Claimant on or before July 2023.

Furthermore, the settlement agreement stated that any future claims or disputes arising from the agreement would be resolved through e-arbitration, adhering to the rules of PrivateCourt. This clause ensured that any potential disagreements regarding the settlement would be handled efficiently and in a legally binding manner.

The Inference:

The agreed-upon payment plan allowed both parties to find a mutually acceptable solution, thus avoiding a protracted and expensive legal battle. The involvement of PrivateCourt showcased the importance of unbiased conciliation and the value of ADR in resolving commercial disputes efficiently and effectively.