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Agency and Distribution Contract Dispute Claims
If you are involved in a contract dispute related to an agency or distribution agreement, the specialist solicitors at JMW can help you to make a claim. Our experienced legal specialists will help you to come to a solution that has as little impact on your business as possible.
Our solicitors will work to resolve any disputes as amicably as possible and will use alternative dispute resolution to ensure this happens. This is a particularly complex area of the law, and a knowledgeable and diligent solicitor is required.
Contact us today to speak to an experienced contract dispute solicitor by calling 0345 872 6666. Alternatively, complete our online enquiry form and we will be in touch at a time that is suitable for you.
How JMW Can Help
Making an agreement with an agent or distributor is not a risk-free option. It is vital you seek out good information in relation to their plans in the market and ensure you have an ability to exit the arrangement if things do not go as promised. Agents in particular often have legal protection that safeguards the work they have done on your company's behalf.
Our team has vast experience of acting in relation to distribution and agency agreements and issues relating to their termination. We can help guide you through this potentially difficult time, providing you with the advice you need to make the right decisions and giving you the confidence to progress along this route.
About Distribution and Agency Agreement Disputes
Entering a market or territory in which you do not have expertise can be daunting and costly. Using distributors or agents provides businesses with access to local market knowledge and potential customers without having to establish an office or recruit a sales team in a new market.
Appointing an agent allows a third party to sell goods on your behalf. The agent finds the customers and often carries out negotiations before a contract is formed directly between you and the customer.
A distributor will also find customers in the market in which they have responsibility. However, the key difference between a distributor and an agent is that a distributor will enter into contracts with the customer directly.
What is the difference between an agency agreement and a distribution agreement?
An agent is enlisted to act as an intermediary and is granted authority (or ‘agency’) to negotiate and enter into contracts on behalf of the principal party. Liability for any bad debts incurred throughout this transactional process are limited on the basis that it is ultimately the decision of the principal to assess the credit risk of a potential customer.
The agent does not own the products or services in the course of passing them to the end customer. However, it will be paid a commission from the principal, and compensation may be payable if the agreement is terminated.
On the other hand, a distribution agreement does not give the distributor the authority to negotiate or complete sales on behalf of the principal. In this instance, the distributor purchases the products outright from the principal and sells them to the end customer. This means the distributor will own these goods in the interim.
When products are purchased, there are two sales contracts - one when the distributor purchases the products from the principal and the other when the end customer buys the products from the distributor.
What happens if there is no agency agreement in place?
If you do not have a written agency agreement in place, the duties of each party may not be clearly defined, which can lead to disputes. Without a written agreement in place, there is a strong possibility that there will be less control and accountability for both parties.
Whether you are an agent or a principal, we would strongly advise having a written agency agreement in place.
Talk to Us
Speak to JMW’s experienced commercial litigation specialists today if you are involved in a dispute relating to an agency or distribution agreement. We are on hand to guide you throughout the legal process to ensure a resolution is achieved.
Partner and Head of Department
Commercial Litigation/Corporate Recovery and Insolvency