Results 1 to 9 of 9

Thread: business protection against bad suppliers

  1. #1
    Platinum Member SilverNodashi's Avatar
    Join Date
    May 2007
    Location
    Johannesburg, South Africa
    Posts
    1,197
    Thanks
    12
    Thanked 188 Times in 136 Posts

    business protection against bad suppliers

    I wonder if someone can shed some "legal?" light on this matter.

    Fortunately I've never been down this road but now sit with a situation where I acquired "professional services" of another company but they simply don't deliver and I have signed a 12 month contract. As far as I know, a company can't take another company to the small claims court, nor do I think the National Credit Act will help in this case.
    The agreement was signed between 2 PTY's, if that helps at all. The supplier don't deliver on their promises and I can't get any correspondence from them. The services mount to R400/pm which I could rather add to my marketing or sales budget.

    What recourse can I take?
    Get superfast South African Hosting at WebHostingZone

  2. #2
    Diamond Member AndyD's Avatar
    Join Date
    Jan 2010
    Location
    Cape Town
    Posts
    4,923
    Thanks
    576
    Thanked 934 Times in 755 Posts
    If they're not performing then I assume they're in breach of contract. Can't you just give them due warning and cancel the contract?
    _______________________________________________

    _______________________________________________

  3. #3
    Platinum Member SilverNodashi's Avatar
    Join Date
    May 2007
    Location
    Johannesburg, South Africa
    Posts
    1,197
    Thanks
    12
    Thanked 188 Times in 136 Posts
    Quote Originally Posted by AndyD View Post
    If they're not performing then I assume they're in breach of contract. Can't you just give them due warning and cancel the contract?
    The thing is, I signed a 12 month contract, believing that I'll get a service which I purposefully asked for but found out it's not what I wanted. I don't want to go into details yet since it could turn out bad for either of us.

    But, imagine signing a 24month cellphone contract with a cellular company and after signing the contract you get something else than what you wanted. How does a business, in a case like take, take legal action to have the signup fee refunded and the contract cancelled? Legally I now need to pay for a service which is of no use to me and I didn't even get what I actually need.
    Get superfast South African Hosting at WebHostingZone

  4. #4
    Site Caretaker Dave A's Avatar
    Join Date
    May 2006
    Location
    Durban, South Africa
    Posts
    22,649
    Thanks
    3,305
    Thanked 2,676 Times in 2,257 Posts
    Blog Entries
    12
    Reading between the lines here - are they not delivering what they are contracted to deliver, or is it a case of the contract doesn't deliver what you expected it to deliver?

  5. #5
    Platinum Member SilverNodashi's Avatar
    Join Date
    May 2007
    Location
    Johannesburg, South Africa
    Posts
    1,197
    Thanks
    12
    Thanked 188 Times in 136 Posts
    Quote Originally Posted by Dave A View Post
    Reading between the lines here - are they not delivering what they are contracted to deliver, or is it a case of the contract doesn't deliver what you expected it to deliver?

    Dave, without going into too much details for various reasons,

    I told them I need ProductX, in order to comply with a requirement of another vendor. They said "sure we can do that". I signed a 12 month agreement + setup fee + 2month's security deposit. VendorY then replied and said, "sorry this doesn't comply". I purposefully told SupplierA that I need ProductX to complay with VendorY, but now the product doesn't comply and when I told them this, they stopped all communications.
    Get superfast South African Hosting at WebHostingZone

  6. #6
    Platinum Member sterne.law@gmail.com's Avatar
    Join Date
    Oct 2009
    Location
    Durban
    Posts
    1,332
    Thanks
    38
    Thanked 566 Times in 413 Posts
    Blog Entries
    7
    A contract is breached when they don't deliver or fail to deliver as per agreement.
    Failure to deliver may also be linked to time. Time is sometimes specifically stated, if so that is the date.

    Breach requires notice -
    of the breach and the time to rectify.
    On your facts the following seems what you would want -
    You can seek cancellation of contract. - Probably also deposit returned
    Damages - if there is a price difference in the product and have already quoted, then you could claim that.
    The faulty product can be returned and your money refunded
    Anthony Sterne

    www.acumenholdings.co.za
    DISCLAIMER The above is merely a comment in discussion form and an open public arena. It does not constitute a legal opinion or professional advice in any manner or form.

  7. Thanks given for this post:

    Dave A (19-Nov-13)

  8. #7
    Platinum Member SilverNodashi's Avatar
    Join Date
    May 2007
    Location
    Johannesburg, South Africa
    Posts
    1,197
    Thanks
    12
    Thanked 188 Times in 136 Posts
    Hi Sterne,

    Thanx for the replies. I know they're in breach of contact, but how do I take recourse against them to cancel & refund? The Small Claims Court would only help if I signed the contract in my own personal capacity, but I signed the contract as a company (PTY Ltd) so they won't help me. And a lawyer will cost me much more than the money I spend on the contract.
    Get superfast South African Hosting at WebHostingZone

  9. #8
    Platinum Member sterne.law@gmail.com's Avatar
    Join Date
    Oct 2009
    Location
    Durban
    Posts
    1,332
    Thanks
    38
    Thanked 566 Times in 413 Posts
    Blog Entries
    7
    Send them a letter notifying them of breach by virtue of malperformance and seven days to correct, failing which you are cancelling the contract.(See if the contract has specific terms regarding breach and notice period. there is no set amount of days required - reasonable is the standard.)
    That will take care of the contract. They would have to sue you for a so called breach to claim payment.

    If you are paying more for the product and cant pass the increase on to client, then you will need to weigh up if there is any damages and if so how much. By the sounds of it, the amount may not be worthwhile.(On an aside, damages could included a loss of contract from your client).
    Anthony Sterne

    www.acumenholdings.co.za
    DISCLAIMER The above is merely a comment in discussion form and an open public arena. It does not constitute a legal opinion or professional advice in any manner or form.

  10. #9
    Platinum Member SilverNodashi's Avatar
    Join Date
    May 2007
    Location
    Johannesburg, South Africa
    Posts
    1,197
    Thanks
    12
    Thanked 188 Times in 136 Posts
    Thanx guys. This issue kinda "resolved itself". There was some miscommunication from the "sales rep" to the admin clerk who setup the contract and invoices. We managed to sort it out, but I had to lay some complaints with the management team first.
    Get superfast South African Hosting at WebHostingZone

Similar Threads

  1. looking for cow hide suppliers
    By Niki in forum General Business Forum
    Replies: 0
    Last Post: 21-May-12, 01:36 PM
  2. Business hits back at consumer protection act!
    By garthu in forum Consumer Protection Act Forum
    Replies: 1
    Last Post: 15-Dec-10, 09:44 AM
  3. Evening business forum meeting - Consumer Protection Act - How does it affect you
    By V2B services in forum Consumer Protection Act Forum
    Replies: 0
    Last Post: 03-Jun-10, 08:41 PM
  4. [Question] Can't pay suppliers
    By Conan in forum General Business Forum
    Replies: 10
    Last Post: 22-Sep-09, 05:10 PM

Did you like this article? Share it with your favourite social network.

Did you like this article? Share it with your favourite social network.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •