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Engine Oil Super Stockist V Distributor

Date of Claim raised: 18/09/2021
Date of Conciliation: 24/09/2021
Date of Settlement: 24/09/2021
Digest: Mediation/Conciliation/Dispute/Claimant/Respondent/Invoice/Settlement
Case Summary

This was a dispute which occurred between a cycle manufacturer (Claimant) based in West Bengal and a dealer (Respondent) based in Mumbai. This was a unique case as the parties involved were related to each other through family, and the business relationship was also quite old. The dispute occurred when the respondent seized paying the outstanding credit amounts for the products supplied.

The Issue

The distributor's shop was in an old building, and a part of this building had collapsed, which completely destroyed his shop and all the products within it. The unfortunate part was that the insurance was not renewed in time, and there was no way the respondent would have been able to raise any money to pay the claimant. As there was a family relationship through which this cash flow problem would affect the claimant, he was reluctant to talk to the respondent directly so as to avoid any family dispute in his times of difficulty. Considering this, PrivateCourt was approached to handle this sensitive matter.

The Process

Taking cognizance of the situation, the Mediator approached the respondent and tried to understand his situation and also understand his vision of what he intends to do to rectify the matter at hand. Post deliberations, it was established that the respondent would need to be helped to come back into business, and to do so, the claimant was more than happy to help. The respondent had identified a shop in nearby vicinity, and the claimant was happy to help him restock his shop with goods. Post joint deliberation, an agreement was arrived upon.

The Settlement Agreement

An agreement was entered into where the respondent agreed to pay the entire amount of Rs. 4,57,406/- in 12 months. Out of every payment made, 50% would be written off towards old outstanding, and the claimant also agreed to supply goods worth the remaining 50% amount to help the claimant stay in business. The claimant also agreed to set off 10 % from the entire outstanding amount if the respondent would successfully refund the entire outstanding amount from the date of conciliation.

The Inference

Intervention from a professional 3rd party can be useful in avoiding uncomfortable discussions and bringing out positive outcomes for both sides.