Misunderstanding and technical errors as the reason for dispute

A company applied to Interlegal for carrying out claims handling with their counterparty. Due to a simple misunderstanding, business relations of the parties were in jeopardy, while our Client risked losing a contract amounting to 3,500,000 US dollars. Let us reveal the intrigue right away: professional actions of our law team helped the partners to reach a compromise and to save the deal for a six-figure sum.

The essence of dispute was that the Client, as FOB seller, delivered the goods to the Buyer, handed over all the documents, received payment, but later received a claim regarding quality of the goods, namely, the presence of pesticides that exceed the contract specification and, accordingly, the impossibility of its customs clearance. Due to the violation, the Buyer demanded a large discount, incompatible with the contractual price in whole.

The client carried out its own analysis of product samples to be sure of the goods quality before entry into the contract. There were no doubts concerning quality of the goods.

Having agreed on terms and having entered the contract, the Client conducted analysis of the samples in accordance with the contract. All indicators were normal, except for pesticides. The client asked the laboratory for appropriate explanations regarding the results and asked for additional analysis exclusively for the presence of pesticides. As a result, the Client received three documents regarding the conducted analyses. However, re-analysis did not reveal an excess of pesticides.

In the process of thorough analysis of circumstances, correspondence and documents, Interlegal law team discovered a technical error. The Client turned out to send to the Buyer the results of the first and third tests, of which the first one had an inflated indicator of the pesticide. The second analysis, which reflected the contractual result, remained out of sight of the Buyer, as a result whereof the dispute arose.

Interlegal law team drafted appropriate recommendations for the Client, as well as formulated letters to be sent to the counterparty. It should be noted that the laboratory provided all relevant technical explanations, being also sent to the Buyer jointly with the second document replacing the non-contractual one. After a detailed check and error detection, the Buyer and the Seller reached a compromise, while the disputed issue was closed without discounts.

Therefore, due to professional, thorough and coordinated actions of law team, namely: partner Oleksiy Remeslo and junior lawyer Denys Bakaiev, Interlegal managed to settle the dispute in the process of its genesis, which allowed to save the contract amounting to 3,500,000 US dollars, as well as to save business relations of the parties.