GOOD MORNING FROM LONDON

BEING AN ADVOCATE – EPISODE 5

EPISODE 4 CONCLUDED;

The Buyer’s advocate has done his homework and provided a schedule of market information to show that the market price on 1 February 2023 was $1000 leading to damages of $3.25m. The Seller’s evidence is less substantial consisting of a contract of quite similar goods dated the 30 January 2023 with a market price of USD 750 pmt.

You have a problem.  How do you handle it?”

You probe. You have suspicions but you don’t voice them. You become forensic and build up a picture. You don’t accuse. You ask questions. “Who negotiated the contract? How was the contract negotiated? Were you involved in the negotiations? How were you – the client – involved in the $750 contract? Was it a speedy negotiation or was it spread over a few days? Did you initiate the contract or did one of your staff handle this? What is the procedure for contract conclusion within your company? Who in your company checked the market position? What are the company’s rules that have to be observed regarding contract negotiation? Run through them for me? Looking back were you content with the manner in which this contract was negotiated?

At this stage the client is a little on edge. You have known him, even traded with him. He is a big character, known in the trade to have “balls”. Self-confident, assured and with a track record of big trades. But things do not add up. You are suspicious. You have doubts. Bells – funereal not celebratory – are beginning to ring.

The negotiation involved two traders in the client’s company. One took the leading role but you are taken aback to hear that the lead Trader has left the company. The client is quick to inform you that the reason for his departure was unrelated to this transaction but that there was an incident on another piece of business that triggered his goodbye. You sense that the departed employee will not be enthusiastic to attend the arbitration hearing and give evidence for the client.

You continue with your forensic approach – friendly rather than confrontational – but persistent nevertheless. It emerges that the client’s office has a staff of 28. The client is ‘hands on’ and rarely delegates. The client – at your request – goes over the procedure to be adopted when business discussions move to business contracted. What documents are sent and by whom and to whom? Is the file opened when the contract is confirmed? And which of the Seller’s departments receive details of the sale and when? Who handles the purchase of the product that comprises the goods to be sold in this contract? When were the goods purchased and from whom and on what date?

When your client exhibits discomfort at your questioning you tell him that your priority is to anticipate the questions that are likely to be asked by the Buyer’s advocate. The advocate will be aggressive and want to dismiss the significance of the Seller’s contract so you put yourself in his/her shoes and work out his likely line of attack so you are not taken by surprise. Forewarned, you tell the Seller, is Forearmed.

Your case depends on your ability to persuade the Tribunal that the Seller’s evidence is true and that it has commercial integrity and the Seller’s market information ticks all the boxes.  But you have quite reasonable doubts – so what is your next step? How do you engage with your client? What do you actually say to him/her?

EPISODE 6 – WHERE DO YOU DRAW THE LINE?