Beit Midrash

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Disagreements Between a Supplier and a Store


Various Rabbis

Adar 7 5780
Based on ruling 70075 of the Eretz Hemdah-Gazit Rabbinical Courts.

The plaintiff (=pl) signed an agreement with a supplier of produce for a niche clientele (=def) to open a store selling only their produce. There were disagreements about some shipments that def made to pl, and pl was also behind in payments. Def merged with another company (they are joint defendants), and before the merge, pl and def had a meeting to iron out issues, in which pl made certain complaints and gave checks for an amount the sides agreed to. After pl fell further behind in payments, def stopped sending produce. This forced pl to stop his operations; he still had to pay rent. Pl is suing def 100,000 shekels for a unfulfilled promise that he would be def’s sole outlet in his area (def denies such a commitment), 5,000 shekels for making pl do his own deliveries a few times, 9,300 shekels for wasted store rental (def – it was pl’s fault for stopping payment); 24,766 shekels for deliveries with too little produce (def – one charges for stacks of produce based on average weight; sometimes they are less, sometimes they are more); 9,900 shekels for late-night deliveries that were stolen (def – by contract, pl may make off-hour deliveries). Def is countersuing 54,431 shekels for payment due on deliveries. Def is holding a bounced check from pl and a guarantee that is being processed by hotza’ah lapo’al.

Ruling: In general, pl did not provide support for many of his claims. The relevant contract states that pl accepts def’s invoices for deliveries as correct. Furthermore, def is correct that any claims that relate to the time before their meeting are not to be accepted. While pl might not have been happy with all of the "understandings," once they gave checks to a certain amount without clear stipulation, they accepted the compromises regarding all previous disagreements. This includes the matter of exclusivity (about which there is also no hint in the contract and was at most a statement made by an agent of def without authority to obligate them).

A middleman between the two explained (although his testimony is not classically valid because of interests) that the industry standard is that the deliveries are based on number of stacks and average weight. In any case, beit din accepts the contract stipulation that def is believed on such matters (it is impossible to weigh and prove each element of each shipment). According to many poskim, the fact that def is holding a check and guarantee makes them the muchzak (the one who is in control, putting the burden of proof on the other side).

Regarding the off-hour deliveries, although the standard contract between def and his retailers allows this, since pl complained during their joint work that in his commercial area, thefts are common, def should not have made such deliveries. As a compromise, pl will only be charged one third for those deliveries. Regarding the lost rent, def does not have to continue supplying produce to pl when payment is far from assured, and therefore pl is responsible for his own losses.
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