On Jun 23, 6:58 am, peter <peter.jenni...@gmail.com> wrote:
> I supply goods from Europe into the UK, I'm an agent for various
> Europeans suppliers.
Are you the suppliers' employee, or an independent businessman? In either case, if your relationship as a mere agent to the suppliers (who would be the principal party actually contracting with the buyer to sell the goods) was disclosed to the buyer, you probably do not have any personal liability (under USA law at least) for breach of contract, if your supplier/principal fails to fulfill a proper order from a buyer that they had accepted. However, your supplier would. And if you FAILED to disclose to the buyer that you were only acting as agent for your principal, he could sue the principal AND could also sue you directly, at least under USA law.
Before we get into this, though, why are you asking about this here? Most of the netizens on MLM are in USA. If you really think you need legal advice, you need to ask someone on your side of the pond, especially since it seems to require a knowledge not only of UK law but EU commercial law as well and possibly also the domestic civil law of one or more Continental nations. If you are an employee of the supplier, ask to speak to _their_ legal dept. If you are independent, this is a good time to look around and get yourself a solicitor you can put on retainer to advise your business from time to time. That would be a very good investment and a reasonable cost of doing business.
> I received an order from a UK customer for 1 load
> + 1-2 more. The order was verbal. I agreed this with my supplier.
It sounds possibly as though in your usual practice, a customer's order is not "accepted" until you relay it to the supplier for whom you act as agent, and until that supplier says "yes" to the order. In that case you did nothing wrong, if you relayed each order promptly when it came in. In a rising market, it is the buyer who is out of luck, for not placing a definite order for the extra loads sooner than he did. The question that remains is whether the buyer in fact placed a definite order at the old price for future delivery (and future payment) that was accepted by someone with authority to accept it.
> Then
> a formal order came in for the first load and I passed it on to the
> supplier, they supplied, invoiced directly and were paid in full.
The fact that the supplier invoiced the buyer directly makes me think you are _not_ acting as an independent middleman (distributor, jobber, wholesaler) in this transaction such that you would buy goods on your own account from the supplier at your cost and resell them to your buyer at a (hopefully) higher price, taking your own profit and overhead from the difference. How, indeed, do you get paid for what you do? Do you get a commission on completed sales? A salary? In either event it sounds like it is the supplier, not you, who+ has a contract with the buyer, and that you are working for the supplier and paid by him.
> Then I received a second order. The supplier then said that they had
> run out of goods and hadn't reserved goods as they had never received
> a formal order for more than one load! It's a steeply rising market,
> so the customer can't buy elsewhere at the same price and is
> understandably angry. They say that they will look to force me to
> supply two more loads at the same price, but can they?
That depends on all kinds of facts not apparent from your post, and is why you should either consult your own solicitor promptly or, if you are an employee-agent of the supplier, notify the supplier that the buyer is making this claim and let them (and their legal dept.) take care of it.
As other posters' replies have indicated, the bottom line question is, "Does a binding contract exist for the second load?" That answer is probably determined by whether the buyer, and you, reasonably thought at the time of the original conversation about "1 load plus 1 or 2 more" that the "1 or 2 more" was a definite, mutually binding, order for future delivery at the set price. I can't personally see how it was, if the quantity was still indefinite, since what could you have told the supplier to hold aside for future sale at that point -- 1 more, or 2 more loads? But a court may decide differently.
> a) The only formal order was for the first load. This order was
> completed by the supplier. My name didn't appear on any of the
> papers.
> In theory then this order is still unfulfilled and I didn't sign any
> contract/order.
That statement puzzles me (one of many, in your post). Why do you say, "In theory [the first] order is still unfulfilled?" Obviously, it _was_ fulfilled, directly by the supplier as both you and the buyer apparently anticipated.
> b) The subsequent orders were verbally placed and although I'm
> inclined to sympathise with the customer, this doesn't help if the
> customer wants to force me to supply. I had a verbal order with the
> supplier (I've known them for years), but they seem to have forgotten
> the order or have sold the goods in a sellers' market.
OK, now it's sounding like you are NOT directly employed by the supplier. You will have to clarify that if you want any useful responses.
What were the exact terms of your "verbal order" with the supplier? Did you in fact put them on notice you wanted them to set aside at least one, perhaps 2 more loads, for this customer to buy later at the original price? If so, what did they say they would agree to do? There's too much left unsaid in your post to give any definite answer about who is liable to whom even putting aside that we don't know yet which set of law applies.
> c) Although they sent through a formal second order. I came back to
> them immediately with the problem and so didn't accept it.
Now your language again seems to support the view that there is no binding contract formed until your supplier, for whom you are acting as (disclosed?) agent, "accepts" the order and agrees to fulfill it.
> As always I'm trying to supply the goods from elsewhere,
So, are you an agent for a variety of different suppliers? Do you in fact buy on your own account, or simply relay these orders to potential suppliers who then bill directly to the customer (much the way an independent insurance agent does for a variety of companies)? You need to get your facts straight on these issues.
> but I'd like
> to point out to the customer that there is little point in trying to
> force me to supply.
Sir, to the contrary, there is _every_ point in this buyer trying to force you to supply, IF in fact you have a contract obligation to do so. He could either compel performance at the original price or, if that is not possible, he could sue you for the price difference if he has to obtain them elsewhere. In addition, he can also sue (1) for his own lost profits if _he_ was planning to resell them and was unable to do so because you failed to supply; (2) for his incidental expenses (warehousing, transportation, insurance, etc.) to obtain them from an alternate supplier, and (3) for his conseequential damages, if these losses were of the type within the reasonable contemplation of the parties at the time of contracting. Frex, if he had to shut down his entire factory because you failed to supply the widgets he had ordered, and needed, to keep the place running, _you_ could be liable for _all_ his resulting losses, which could run into the millions or more.
Get your facts together, and ask your solicitor for real advice. You could be sitting pretty, with no real liability exposure, OR you could be in a situation where your potential damages you could owe this buyer are far more than the mere price of the goods. Good luck,
--
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Mike Jacobs
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