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Label Supplier V. Fashion Brand

Date of Claim raised: 29/04/2023
Date of Conciliation: 02/05/2023
Date of Settlement: 02/05/2023
Digest: Mediation/Conciliation/Dispute/Claimant/Respondent/Invoice/Settlement
Case Summary

In the bustling city of Thane, Maharashtra, a dispute arose between a reputable label supplier, the Claimant, and the Respondent, a midsize fashion garment store owner. The Claimant, located in the industrial town of Ambernath, had established itself as a leading seller of high-quality labels. They prided themselves on providing top-notch products and services to their clients.

The disagreement stemmed from the nonpayment of a disputed amount of Rs. 3000/- by the Respondent to the Claimant. Despite multiple attempts by the Claimant to collect the outstanding payment, the Respondent failed to fulfill their financial obligation. Frustrated by the lack of cooperation, the Claimant sought resolution through alternative dispute resolution methods.

Recognizing the need for a fair and impartial resolution, the parties turned to PrivateCourt to find an amicable settlement and avoid lengthy court proceedings. Both parties hoped to bring an end to the dispute swiftly and restore their business relationship.

The Issue:

The dispute between the Claimant and the Respondent revolved around the nonpayment of a disputed amount totaling Rs. 3000/-. The Claimant, a prominent label supplier, had provided a bulk order of labels to the Respondent's fashion garment store. The goods were delivered as per the agreed-upon terms and conditions.

However, upon receiving the labels, the Respondent claimed that the quality of the products was subpar and did not meet their expectations. Consequently, they refused to make the full payment, citing the alleged inferior quality of the labels as their justification.

The Claimant vehemently disputed these claims, asserting that the labels supplied were of the highest quality, consistent with their usual standard. They argued that the Respondent's dissatisfaction stemmed from unrelated factors, such as a decline in their store's sales or a change in their marketing strategy.

There were additional reasons that led to the dispute as follows:

Delayed Delivery: The Respondent claimed that the label supplier, the Claimant, failed to deliver the ordered labels within the agreed-upon timeframe. The delayed delivery allegedly caused significant disruptions to the Respondent's business operations, leading to financial losses and customer dissatisfaction. As a result, the Respondent believed they were justified in withholding the full payment until the delivery issue was adequately addressed.

Communication Gap: Both parties identified a breakdown in communication as a contributing factor to the dispute. The Claimant argued that they had provided clear specifications and details regarding the labels, and any alleged quality issues were a result of the Respondent's failure to communicate their specific requirements effectively. Conversely, the Respondent claimed that the Claimant did not adequately address their concerns or provide satisfactory solutions when they raised the issue of label quality. The lack of effective communication exacerbated the dispute, making it more challenging to find a resolution without third-party intervention.

The PrivateCourt Proceedings:

PrivateCourt, as the trusted conciliator, swiftly intervened to address the dispute. They sent a formal notice to both the Claimant and the Respondent, outlining the conciliation process and the required documentation. The PrivateCourt team meticulously vetted the case, ensuring the proceedings adhered to established protocols and maintained an unbiased approach.

As per the Notice of Conciliation, the conciliation process was scheduled via Zoom and audio calls conference. However, before the scheduled conciliation, the Respondent reached out to PrivateCourt, notifying them of positive discussions held with the Claimant regarding a potential amicable settlement. The Respondent expressed their willingness to resolve the dispute without the need for formal conciliation.

The Settlement Agreement:

Building on the positive discussions between the parties, a settlement agreement was drafted. The Respondent, acknowledging their obligation, agreed to pay the settled amount of Rs. 3,000/- to the Claimant. The payment was to be made on or before May 17th, 2023.

To safeguard their interests, both parties agreed that any future claims or disputes related to this settlement agreement would be resolved through e-arbitration, following the rules and procedures of PrivateCourt. This provision aimed to provide a mechanism for efficient resolution should any disagreements arise from the settlement.

The Inference:

This case demonstrates the effectiveness of ADR, specifically conciliation, in resolving disputes in a timely and amicable manner. PrivateCourt's intervention provided a platform for the parties to engage in constructive dialogue and reach a mutually beneficial settlement.