During the latter part of 2015 we were requested to act as mediator between two companies (Company A being an International Trading Company) and Company B (being a small detergent factory).
Company A supplied 3ton of a 99% pure chemical to Company B, who manufactured four batches of liquid detergent using the 99% pure product. All four batches were out of specification. They immediately presumed the product supplied by Company A to be faulty and lodged a claim of R 300 000 for loss of 4 batches of product, loss of man hours and loss of equipment time.
Company A’s Attorneys approached us and requested us to facilitate Mediation.
We contacted Company B and after some discussion, they agreed to mediation. Both companies were very keen to find an amicable solution and to maintain a good working relationship.
In the opening statements it became apparent that:
Company A, being a large organization with well equipped laboratory facilities and 100% traceability of all paperwork, felt that a 99% pure product (vs. a 99.9%) is of a high enough quality to not cause the problem experienced. They were also able to prove that the 99% pure product was ordered.
Company B did not have a proper laboratory to do QC work nor could they do any product development work. Their paper work was not all in order as they could not verify what was ordered to what was received to what was used.
After some individual sessions, it emerged that Company B required some technical assistance.
Company A had the resources and at the end offered Company B the following:
- Company B keeps the balance of the 3 ton
- Company A need not pay any compensation but offered to:
- a. Assist Company B in finding the cause of the out of specification product;
- b. Assist it in working away the faulty product, and
- c. Assist the Company in future development work by assisting them with staff and laboratory facilities.
The settlement agreement was drawn up by Company A’s attorneys and the deal was signed that same afternoon.
A follow-up by us a month later showed that both parties were working well together.
Should you require more information, please go to our website: www.wilbrink.co.za or alternatively give me a call on 031 – 266 9035 or my cell 083 265 3805