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  • 7.3-ARBITRATION-TYPES OF DISPUTE AND CLAIMS

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  • Types of dispute and claims

     
     
    • Quality disputes - resolved through quality arbitration
    • Technical disputes  (any other dispute) - resolved through technical arbitration

    Because quality disputes affect the fate of a parcel of coffee (delays are costly and at the same time the quality deteriorates) the rules and time limits for lodging a claim are different from those for technical disputes:

    ECF contracts: Quality claims must be lodged within 21 calendar days from date of final discharge at port of destination. All other claims (technical): not later than 45 calendar days from discharge provided the documents were available to the buyer, or from the last date of the contractual shipping period if the coffee has not been shipped.

    GCA contracts: Quality claims must be lodged within 15 calendar days after discharge or within 15 calendar days after all Government clearances have been received. All other claims (technical): no time limit for lodging the claim but, a demand for technical arbitration must be lodged within one year from the date the issue first arose.

    Either party to a contract can lodge a claim, preferably in writing, by notifying the other party within the stipulated time limits, that a dispute has arisen. Should amicable settlement prove impossible then the claimant can proceed to arbitration. Suppliers must carefully consider their handling of claims: it is almost inevitable that forcing a claim to be settled through arbitration will signal the end of the relationship with the buyer in question.

    Buyers are most likely to claim on matters of quality, weight, delayed or non-shipment, incorrect or missing documentation etc. Suppliers' claims are more likely to center on late, incomplete or even non-payment or, for example, frustration of a contract by a buyer who fails to provide shipping instructions.

    Fewer and fewer quality claims make it to arbitration because the supplier/shipper does not want to risk the relationship, whereas especially larger buyers do not bother to pursue relatively minor claims, preferring to simply strike the offending supplier off their register, sometimes even without notification.