• THE-COFFEE-GUIDE.gif 
  • QA 101
    Question:
    What to do about a complaint over green bean appearance one month after arrival of the coffee at destination?
    Background:
    What can we do in the event that our customers call us to complain on the appearance of the beans one month after the coffee arrived its final destination? From our view, we are confident about the quality of the coffee we shipped.
    Asked by:
    Grower - Puerto Rico
     
    Answer:

    A clear understanding of coffee quality is imperative for the success of any coffee transaction. Sellers are responsible to adequately describe or present the coffee for sale, whereas it is the duty of buyers to review and evaluate the quality of the delivery in a timely fashion. 

    We do not know on what basis this coffee was sold, i.e. how the quality was stipulated in the contract, something that can be done in different ways. For example, coffee can be sold on description (see topic 04.02.01 of the Guide), or on sample (stock-lot sample, type sample, subject approval of sample etc - see topic 04.02.02). We also do not know the precise nature of your buyer's complaint, except that his concern appears to be with the green appearance rather than the actual cup quality.

    On the basis that the buyer is not the enemy but rather one's transaction partner, one option is to try and reach an amicable settlement of the claim, irrespective of whether it was late or not. Presumably your buyer has submitted an arrival sample, preferably drawn, sealed and dated by an independent third party, to show you why he is complaining. The point here is that, sometimes, payment of a small allowance may remove an issue and could even help to convince the buyer that he has found a good partner for further business.

    If amicable settlement is impossible then arbitration is the only remedy, provided the claim was lodged in time.  Or, alternatively, if both parties agree to extend the time limit…  To remove uncertainty about claim procedures the two main Standard Forms of Contract that govern most of the international trade in green coffee, include time limits for the lodging of claims. The European Contract for Coffee, mostly used for sales to Europe, allows 21 calendar days from the final date of discharge at the port of destination. The Green Coffee Association Contract, mostly used for North America, allows 15 calendar days from date of discharge or after all government clearances have been received, whichever is the later.  Both contracts define the date of discharge as the date on which the coffee became available for delivery. Please see section 04.04 of the Guide for a full review of both contracts whereas chapter 7 of the Guide covers the entire arbitration process for both North America and Europe.

    Finally, we would mention that quality disputes are a fairly common occurrence in the coffee trade. However, most are worked out amicably between seller and buyer, i.e. without recourse to third party intervention or arbitration. In fact fewer and fewer quality claims make it to arbitration because sellers or shippers do not want to risk losing the relationship, whereas especially larger buyers often do not even bother to pursue minor claims, preferring instead to simply strike the offending shipper off their register…

    Posted 20 June 2006

    Related chapter(s):
    Related Q & A:
    QA 006