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Furniture Manufacturer V Trader

Date of Claim raised:08/07/2021
Date of Conciliation: 15/07/2021
Date of Settlement: 06/08/2021
Digest: Mediation/Conciliation/Dispute/Claimant/Respondent/Invoice/Settlement
Case Summary

This dispute is between a furniture manufacturing company based out of Thane and a trader based out of Mumbai. While the manufacturer, in this case, the claimant, regularly supplied furniture to the trading company and had a long-standing relationship, there was a disagreement in the payments that needed to be made for one of the consignments. The two parties had an agreed 45-day credit period for any materials supplied, and most often, the invoices were settled within the stipulated time period. The disputed consignment was supplied on the 10th April of 2021, and a total invoice of Rs. 1,28,000/- was raised. The respondent made a payment of Rs. 1,08,000/- and refused the payment of Rs. 20,000/- and demanded that a few chairs that were supplied be accepted as a return.

The Issue/Dispute/Argument/Claim/Discourse/Disagreement/Scenario

The respondent, while asking for a return, had breached the agreed 15 day return period and had not communicated the same to the claimant within that time period. The respondent claimed that the chairs supplied were not up to the specifications that were discussed, and he will need to return the same. The claimant's stand was that the delivery was accepted by the respondent, and no complaints were made till the due date of the invoice.

The Process/Undertaking/Action

The negotiator, in this case, looked at the purchase orders and the specs given along with the same. Once the authenticity of the claim was established, a discussion with the respondent was arranged, and the negotiator tried to understand his side of the story. What came to fore was that as the goods were delivered to the respondent, the handover of the same was taken by one of his new employees who was not aware of the specs of the order. The same came to fore when the respondent, in turn sold it to his customer, which had a delay of approximately 35-days, by which time the 15-day return period had expired. Through the discussions with both sides the negotiator convinced the respondent that while the claimant understood his predicament, he would need to honour his side of the agreed terms, and in turn, the claimant agreed to supply new chars with the actual specs with an extended credit period of 60 days.

The Settlement Agreement:

The Respondent agreed to pay the amount of Rs. 20,000/- in two equal of Rs. 10,000/- .

  • The first instalment of Rs. 10,000/- on or before August 25. 2021.
  • The second instalment of Rs. 10,000/- on or before September 29, 2021.
The Inference :

Ensuring business continuity along with settling disputes is a necessary part of the goal in negotiations involving long standing and mutually beneficial relations.