Summary of Dispute
The source of the disagreement between Jerry's Pizza and Dazzling Dough Co. is the misunderstanding on the amount of dough and pizza toppings, dessert and soft drinks to be supplied to Jerry’s Pizza by Dazzling Dough Co. Both companies had varying interpretations of the contract, hence the misunderstanding. The deal lacked clarity causing both parties to assume that they had a common understanding, while in the real sense, they did not.
As mentioned before, each party in this dispute had different interpretations of the contract language. The contract instructed that Dazzling Dough Co. supply Jerry’s Pizza with 200 pounds of dough, pizza toppings, dessert, and soft drinks, of which Jerry’s Pizza would pay $30,000. According to Jerry’s Pizza, the contract implied the supply of 200 pounds of dough, and other additional pounds for the pizza toppings, dessert, and soft drinks. Therefore, Jerry’s Pizza expected more than 200 pounds worth of supply from Dazzling Dough Co. Moreover, Jerry’s Pizza was to pay $30,000 for 200 pounds value of dough and extra pounds worth of pizza toppings, dessert, and soft drinks.
Delegate your assignment to our experts and they will do the rest.
On the other hand, Dazzling Dough Co. had its interpretation of the contract. Dazzling Dough Co. interpreted that it was supposed to supply Jerry’s Pizza with dough, pizza toppings, dessert and soft drinks amounting to 200 pounds. According to the company, the weight of the products to be delivered was to be 200 pounds, whereby Jerry’s Pizza would pay $30,000 for the 200 pounds. Dazzling Dough Co., therefore, provided 125 pounds of dough and 75 pounds of pizza toppings, dessert, and soft drinks, all amounting to 200 pounds.
Despite the varying interpretations of the contract, the descriptions were not reasonable. Both companies assumed what the other preferred and avoided seeking clarification before the agreement was signed. Both arguments were based on assumptions instead of factual information. Jerry’s Pizza did not communicate its intent to purchase more than 200 pounds of pizza merchandise from Dazzling Dough Co. On the other hand, Dazzling Dough Co. assumed that Jerry’s pizza wanted a lower amount of the merchandise because other customers may have made the same purchases.
Information that is missing that would be helpful to know how to resolve the dispute is the specific amount of dough to be purchased as well as the particular amount of topping, dessert, and soft drinks. This information would promote clarity thereby ensuring that both companies met each other’s contractual demands.
Proposed Revisions to Contract Language
Solving this dispute would require revising the contract language to provide more specific and informative clauses. Contract language is supposed to be precise to avoid any manner of speculations from either party in the contract. As such, in the agreement, Jerry’s Pizza would have to define the exact amounts of dough it wished to purchase from Dazzling Dough Co. Besides, the deal would specify the number of pizza toppings, dessert and soft drinks that Jerry’s Pizza would require Dazzling Dough Co. to deliver.
Contract language should also be comprehensive. Therefore, the contract would specify each amount of merchandise that Jerry’s Pizza expected from Dazzling Dough Co. and the amount paid for each. Thus said, Jerry’s Pizza would have clarified that it required 200 pounds of dough, as a specific amount of pizza toppings, a particular amount of dessert, and the specific number of soft drinks. Furthermore, it would specify the price it was willing to pay for each of the products, to eliminate misunderstanding.
Ethical Considerations
There are various ethical considerations for a company to enforce specific terms of a contract with another company if the other company is mistaken. Among them is the issue of moral responsibility (Adobor, 2012). The parties in the deal would have to consider who would take moral responsibility for the business transactions. This way, the business partners would know who would take responsibility for any mistake that occurs during the period of the contract.
Another ethical consideration is on corrective action (Adobor, 2012). This issue would present a course of action to correct any damages that occurred as a result of the contract. Both parties would, therefore, be guided on the step to take in case of a breach of contract.
There are also several settlement options and methods of dispute resolution that both parties would engage in to solve the dispute. One settlement option would be to split the difference of the cost not paid for the products delivered to Jerry’s Pizza. This would be a viable option considering both parties were not precise in their specifications on the contract, and both acted out of assumptions.
Another possible settlement option would be to reduce the amount of dough purchased. Therefore, the amount of money Jerry’s Pizza paid to Dazzling Dough Co. would be paid for the mixture delivered. This means that for extra dough, Jerry's Pizza would have to pay an additional amount.
Several methods of dispute resolution exist in Alternative Dispute Resolution. One option is negotiation. Negotiation would require both parties to reach an agreement without involving a third party (Wilcocks & Laubscher, 2017). This strategy is most preferred as it would help preserve the business relationship between the two companies.
Another method is mediation, which would require third-party involvement (Wilcocks & Laubscher, 2017). Mediation is fair because of the impartiality of the mediator. After a decision has been reached, the two companies would have to sign a written agreement.
An alternative to mediation is conciliation that would also require an impartial third party (Wilcocks & Laubscher, 2017). Conciliation results in an interest-based outcome whereby the interest of both companies is taken into consideration. This method is also less time-consuming and less costly.
References
Adobor, H. (2012). Ethical Issues in Outsourcing: The Case of Contract Medical Research and the Global Pharmaceutical Industry. Journal Of Business Ethics , 105 (2), 239-255. doi: 10.1007/s10551-011-0964-0
Wilcocks, T., & Laubscher, J. (2017). Investigating alternative dispute resolution methods and the implementation thereof by architectural professionals in South Africa. Acta Structilia , 24 (2). doi: 10.18820/24150487/as24i2.6
