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Jo C.
Jo C., Barrister
Category: Law
Satisfied Customers: 70633
Experience:  Over 5 years in practice
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i have a business supplying cars to far east. a supplier has

Customer Question

i have a business supplying cars to far east. a supplier has failed to supply cars on which i had placed deposits.

he claims mercedes cancelled the orders and is offering to re-order the cars or supply something similar.

my customer will not agree to this and is unlikely to buy from me again - over the next year this will cost me around £100,000.
Submitted: 3 years ago.
Category: Law
Expert:  Jo C. replied 3 years ago.
Hi.

Thank you for your question. My name is Jo and I will try to help with this.

How can I help with this please?
Customer: replied 3 years ago.

what i really need to know is if i can claim damages against my supplier for the losses relating to losing this client.

Expert:  Jo C. replied 3 years ago.
The supplier is in breach of contract.

What you are trying to claim is called consequential loss or also in this case called pure economic loss.

That is indirect losses relating to the breach of contract.

For consequential loss to be recoverable it has to be "within the contemplation of the parties" so you would have to prove that the supplier knew that if any cars were not delivered on time and to the order specification, you would lose the customer and suffer extreme consequential loss.

Apart from the "within the contemplation of the parties" issue there is also the burden of proof on you to prove that you have lost all this profit as a result.

You are not entitled to recover turnover but only loss of profit.

To prove the loss of profit, you would need to get an experts report from a forensic accountant and base that upon the previous three years turnover and profit and produce some kind of proof that would have continued

If you went to court on this, and you lost for any reason, you could face substantial solicitor's costs if the supplier decided to defend it.

If the supplier is not in the United Kingdom you then have certain logistical problems in suing someone in another jurisdiction.

There is another issue which is that the supplier is not responsible for anything which is outside his reasonable control and if what he is telling it is true and he can prove that the manufacturer cancel the order or let him down, you have no claim.

All this should be covered in your terms and conditions and you may want to have them looked at for the future to avoid this happening again.

Solicitor will probably charge between £1000 and £2000 for reviewing your existing TCs and amending them to cover these kind of eventualities

Can I clarify anything for you?

Jo
Customer: replied 3 years ago.

thank you Jo. that is very clear and makes sense.

Expert:  Jo C. replied 3 years ago.

No problem and all the best.

Remember that I am always available to help with your questions. Even if I am in Court I will usually pick up a question within 12 hours. For future information, please start your question with ‘For Jo C’. You can also bookmark my profile http://www.justanswer.co.uk/law/expert-remus2004/