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Contracts and infidelity: when to terminate a relationship

March 15, 2012

Dear Tim,

My partner keeps flirting with other men. Should I terminate our relationship?

Well, that wasn’t exactly the question I received today, but it is close. The actual request was:”

“If a buyer enters into a supply contract with a supplier but then solicits bids from other suppliers for every order for items covered under the original contract, would that action void the contract with the supplier?”

In either case, as a trained commercial expert, I would of course seek rather more information about the circumstances. This wa show I replied – but what would you say?

There are several factors that come to mind when I read your note. First, is the contract really a contract, or is it some form of Master Agreement that establishes an ability to buy, but with no specific commitment? In other words, does it depend on individual orders that actually then constitute ‘contracts’? Second, if there is a commitment, what form does it take? For example, has the customer committed specific volumes or revenues at an agreed price over a defined period of time? Are they complying with this commitment, or is the issue that they are constantly coming back and seeking a revised price? Again, in itself, this is not a breach, so would not give grounds for voiding or termination unless there is some requirement to achieve a ‘run rate’ that the customer is not meeting and has indicated they do not plan to meet.
I guess my core question is to understand why this is happening. Is this an especially volatile market where the customer feels a need to check prices constantly? Are they perhaps using this contract to call-off at a fixed price when market prices are higher? Or is the issue that the customer has no confidence in the supplier’s pricing, in which case it seems to me that a different discussion is needed regarding how greater trust and cooperation can be established.
And while the words might be different, the sentiments above apply whether it is your real partner or your trading partner!
One Comment
  1. Hi,
    Commitment in any relationship is how much you are active to maintain a health relation with your partner. You have to maintain love, affection, care and mutual understanding. This all make relationship more healthy and committed.
    Thanks for sharing.

    Jennie Anne

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