August 12, 2020

ODR Would Have Helped Save Swapnil’s Business

Swapnil’s Magic Carpets, a carpet manufacturing firm, hired Fusion Goods, owned by Sinha, to supply raw material. Per the agreement, once an order was placed, Fusion had three days to supply the material.

Swapnil took orders and agreed on delivery dates keeping in mind the agreement with Fusion. However, Fusion delayed several deliveries, causing Magic’s deliveries to get delayed. Many customers cancelled their orders. These delays cost Magic Carpets both money, and it’s reputation in the market.

To recover his losses and keep his business afloat, Swapnil decided to sue Fusion in court. Unfortunately, the court took six years to decide the case. The loss of income caused by Fusion’s delays along with the high legal expenses forced Swapnil to close the business. When the court finally did rule in his favour, it was of little consolation to Swapnil.

As Fusion had very clearly breached the contract, if the agreement had had an ODR clause, the case would have been decided in a few months, at a fraction of the cost. Having an ODR clause would probably have saved Swapnil’s business.

Disclaimer: All characters and names are fictional. This is a public interest story, produced by House Court, an online arbitration platform