Dispute Resolution – Aid Funded Business

Overview

We helped a supplier resolve a dispute with the UK’s Foreign, Commonwealth and Development Office (FCDO).

Context and Challenge

Our client was implementing a FCDO funded project in 3 African countries. The parties had fallen out over their interpretation of the scope of work for the project and FCDO had stopped paying our client’s invoices.

Non-payment of invoices is a challenge for any business but in this case our client had significant ongoing costs to cover such as accommodation and subsistence expenses for its staff in-country, project office costs in 3 different locations, equipment and other support expenses.

The client felt that FCDO were in the wrong and asked us to help them draft correspondence that would politely but firmly push back on the points that FCDO were making, assert the client’s position, make FCDO see sense and move on from the impasse so that our client’s invoices could get paid.

Process and Insight

We asked the client to send us the contract with FCDO, all the documentation around the tender that our client had bid for and won and all the correspondence between the client and FCDO around scope of work and delivery of services including reports that our client had submitted. We reviewed all of this material and then set up a meeting with the client’s project manager and the client’s director who was responsible for the project.

When we met with the client we listened to their story about how the project implementation had played out. Having gone through the documents they had sent us we had views around where our client’s position was weak or needed clarity and we tested these views with the client. We played devil’s advocate.

Solution

We concluded that in fact FCDO were not acting unreasonably. Within the tender documentation our client had, in principle, agreed to what FCDO were now asking them to do. Our client had not put sufficient caveats in its original tender proposal to be able to run the argument that the work they were being asked to do was out of scope. When we presented this to the client they accepted the point.

Result

It’s difficult for a project team to admit that when things go wrong it’s their fault rather than their client’s. We gave our client news that they didn’t want to hear but it was the right advice and our client acknowledged this.

Having accepted our advice our client softened their approach with FCDO, accepted that they were going to have to do a bit more work than they envisaged, got the project back on track and their invoices got paid.