Dealing with problems

In ideal business conditions everything should be done carefully — details of offers and orders checked, manufacture of the goods carried out properly, packing and marking verified. However, in spite of every possible care and attention that is given to contracts letters of complaint happen to arrive rather frequently because of various infringements.

There are various reasons for complaints. The following kinds of claims are often made by Buyers:

1. claims arising from the delivery of wrong goods or substandard goods;

2. Claims connected with delays of any kind. (In this case the Buyers can claim agreed and liquidated damages for delay in delivery);

3. claims owing to goods missing from delivery (i.e. short-shipment or short-delivery);

4. Claims that concern errors in carrying out an order. These may be caused by mistyping of gures, misreading of numbers, misdirection of goods, wrong packing and so on.

Sellers most frequently make claims on Buyers because of default of payment.

As a rule a customer will not complain unless he has a good reason. If the customer's complaint is well-grounded, the settlement is comparatively easy: the error will be admitted and the responsible party will meet the claim fully or partially. In other words, the dissatisfied party will get full or partial compensation for the losses which they suffered. Thus the matter is settled amicably).

Much more difficult is the case where the customer's complaint is not justified. It would be wrong policy to reject the claim off-hand. The responsible party must carefully explain why the claim is declined and try to persuade the dissatisfied party to withdraw the claim.

If a com^promise cannot be reached the parties_, in dispute have to resort to litigation. Litigation can be wry expensive, very slow and it causes antagonism. Often, in business the client has to continue to deal with the person with whom he is in dispute. Therefore it is not always in the best long-term interests of the parties to enter into such hostile relations as are involved in court procedure. In recognition of this fact, a number of procedures of alternative dispute resolutionhave been developed.        

Alternative dispute resolution is a means of resolving disputes by using an independent third party who may help the parties to reach their own solution, but who cannot impose a solution. It is voluntary. The parties choose the process and either of them can withdraw at any time.

The most effective of these alternative procedures is arbitration. This is the procedure whereby parties in dispute refer the issue to an arbitration court. In arbitration a dispute is decided by one or more arbitrator(s) who are usually experts chosen from a particular field or professional body. The decision of the arbitration court is called an award. The award is made by a majority vote. The award of the Arbitration Court is final and binding upon both parties and enforceable through the courts. It is not subject to appeal.