Saravanan (Purchase) (36 Points)
11 May 2010Can a Supplier stops supplying the materials ordered to one of his Customers by applying Force majeure clause even though he is ready to supply to his other customers? In other words, Can a supplier apply Force majeure clause selectively to one customer?
Please guide me.
Many Thanks,
CS Mayur Buha
(Company Secretary)
(238 Points)
Replied 12 May 2010
Dear,
He can do only when he did a seperate agreement with particular customer.
Saravanan
(Purchase)
(36 Points)
Replied 12 May 2010
Dear Mr.Mayur Buha,
Thanks for your reply. When a supplier is ready to apply Force Majeure, it means he is not able to manufature any material at his plant. So, how can he stop supplies to one customer and make supplies to other customers.
Is it legally acceptaable?
Awaiting your valuable response.
CS Mayur Buha
(Company Secretary)
(238 Points)
Replied 12 May 2010
Dear,
can you explain me your perticular problem?
Because the force Majeure clause depends on the terms and conditions of specific agreements.
Saravanan
(Purchase)
(36 Points)
Replied 14 May 2010
Dear Mr. Mayur Buha,
We have an agreement with a Supplier A to buy a Material X for a period of 3 years at Rs Z rate.
As per the agreement, Supplier should supply the material at Rs Z rate till the expiry of the agreement period. But, after 2 years from the commencement of the agreement, the supplier demands a higher rate citing his raw material rate increase. As we told him we can not give rate increase as per the agreement, he replied that he is going to apply Force Majeure due to Power disruptions and stop supplies to us.
Under this circumstance, can we ask the supplier that you can not apply Force Majeure selectively for us ?
Awaiting your early response.
CAclubindia
