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A

A Bar Brother

Junior Member
Brumby said:
We have already established in post #1754 that the RFP only attributes liability for direct cause for non compliance. I think your post is disingenuous in shifting (again) the narrative on liability where the discussion and evidence suggest otherwise. The Hawk example clearly supports the notion that liability is due and enforceable when direct cause is established i.e. for faulty materials as should be in any sensible commercial contractual obligations.

Please explain where is direct cause to Dassault if and when HAL fails to deliver on assembly. Dassault clearly signed up for primary cause as common sense dictates but not on secondary as with HAL's position.
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As far as we know, Dassault only wants to be liable on the 18 aircraft, not the remaining. And I had already mentioned a long time ago that Dassault and HAL will have to decide what they can be liable for in further negotiations.

And I had also mentioned that the extent of the liabilities are not clear. As far as we know, Dassault wants nothing to do with liability. They basically want to wash their hands off any type of liabilities for the 108.
 
Brumby

Brumby

Major
A Bar Brother said:
As far as we know, Dassault only wants to be liable on the 18 aircraft, not the remaining. And I had already mentioned a long time ago that Dassault and HAL will have to decide what they can be liable for in further negotiations.

And I had also mentioned that the extent of the liabilities are not clear. As far as we know, Dassault wants nothing to do with liability. They basically want to wash their hands off any type of liabilities for the 108.
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I am giving you the benefit of the doubt your statements are simply ignorance of typical business risk and contractual obligations. Even based on simple reading of what is reported as per below article and I quote the last paragraph of it :

"But the sticking point is Dassault's reluctance to accept responsibility for the 108 fighters to be built by HAL as far as liquidity damages and timelines for production are concerned. "It's a contract management issue which needs to be resolved...negotiations are in progress," said a source."

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It is very clear that Dassault has very specific issues on responsibilities over timelines for local production which any clear minded person understands the risk is predicated upon HAL's ability to deliver. This is not something that Dassault can enforce and have control and correspondingly cannot be held accountable contractually. In contrast, the initial delivery of 18 is directly by Dassault and liability is not an issue because Dassault has total control over it.

Your statement that Dassault wants nothing to do with liability is demonstrably false and misleading. It is inconsistent with what has been reported, and logically untenable based on facts on the ground. Personally, I think negotiations are bogged down in terms of specifics with exclusions, limitations and escape clauses concerning liabilities and if both parties are dealing in good faith should be resolved over time.
 
Brumby

Brumby

Major
A more recent article succinctly reported on France's position regarding the liability issue, and I quote from the article "France has said it will help Hindustan Aeronautics Ltd stick to delivery schedules, but that it cannot give guarantees for production of the aircraft made at a facility over which it has no administrative or expert control."

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A

A Bar Brother

Junior Member
Brumby said:
I am giving you the benefit of the doubt your statements are simply ignorance of typical business risk and contractual obligations. Even based on simple reading of what is reported as per below article and I quote the last paragraph of it :

"But the sticking point is Dassault's reluctance to accept responsibility for the 108 fighters to be built by HAL as far as liquidity damages and timelines for production are concerned. "It's a contract management issue which needs to be resolved...negotiations are in progress," said a source."

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It is very clear that Dassault has very specific issues on responsibilities over timelines for local production which any clear minded person understands the risk is predicated upon HAL's ability to deliver. This is not something that Dassault can enforce and have control and correspondingly cannot be held accountable contractually. In contrast, the initial delivery of 18 is directly by Dassault and liability is not an issue because Dassault has total control over it.

Your statement that Dassault wants nothing to do with liability is demonstrably false and misleading. It is inconsistent with what has been reported, and logically untenable based on facts on the ground. Personally, I think negotiations are bogged down in terms of specifics with exclusions, limitations and escape clauses concerning liabilities and if both parties are dealing in good faith should be resolved over time.
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BAE paid liquidated damages because HAL failed to deliver the Hawks in time. Can you explain why BAE paid liquidated damages to the Indian govt when it was clearly HAL which didn't deliver the aircraft in time?

HAL will be heavily dependent on Dassault supplying equipment for manufacturing aircraft. What OEMs do is they supply wrong jigs and fixtures to delay the project. The Russians have done this, the French have done this, and the British have done this.

And I will repeat again, Dassault doesn't want any type of liabilities. They are willing to accept liabilities only if HAL transfers executive powers over to Dassault over Rafale. They want a minimum set of infrastructure built by HAL and power which is unacceptable to India. As of today, they want liabilities only on the 18 aircraft they are to deliver.

This quote...
But the sticking point is Dassault's reluctance to accept responsibility for the 108 fighters to be built by HAL as far as liquidity damages and timelines for production are concerned. "It's a contract management issue which needs to be resolved...negotiations are in progress," said a source.
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...is exactly what I have been saying.

Basically, all the rules and regulations were available in open source for years. When Dassault signed up for the MRCA deal, they accepted all the rules and regulations. The liabilities were part of that.

Now they don't want liabilities because it is convenient to them and you are blaming us?

If they didn't want liabilities, they shouldn't have been part of the RFP process since the beginning. LM did not participate with the F-35 because the timeline and ToT obligations were impossible to achieve, so why didn't Dassault? They probably though they will negotiate and get away with it because the IAF will pressure the MoD to give concessions.

All of it is right here.
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Liquidated Damages (LD) - In the event of the Seller's failure to submit the Bonds/Guarantees/
Documents or/and supply/perform the items/services as per Delivery schedule specified in the contract,
the Buyer may, at his discretion, withhold any payment until the completion of the contract. The Buyer
may also deduct LD to the sum of 0.5% of the contract price of the delayed/undelivered stores/ services
mentioned above for every week of delay or part of a week, subject to the maximum value of the
Liquidated Damages being not higher than 5% of the value of delayed stores / services.
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You can look for "Liquidated Damages" and it will take you to all the sections.
 
Brumby

Brumby

Major
A Bar Brother said:
BAE paid liquidated damages because HAL failed to deliver the Hawks in time. Can you explain why BAE paid liquidated damages to the Indian govt when it was clearly HAL which didn't deliver the aircraft in time?
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Simple. You should remember what you write.

A Bar Brother said:
BAE provided defective tools for manufacturing the Hawks which led to delays, and BAE paid for it.
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In your own words, BAE paid not because there was manufacturing delays but BAE provided defective tools that led to manufacturing delays. In this case specific performance breach was established and hence BAE paid for liquidated damages.

A Bar Brother said:
HAL will be heavily dependent on Dassault supplying equipment for manufacturing aircraft. What OEMs do is they supply wrong jigs and fixtures to delay the project. The Russians have done this, the French have done this, and the British have done this.
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This type of commercial arrangement is normal supplier relationship and when there is failure to deliver on time or there is failure to meet prescribed quality standard with the product, the negotiated penalties kick in. It is an everyday business relationship within a supply chain around the world. There is nothing unique in any structured business arrangement that legal safe guards cannot be negotiated and build in provided the terms establish what actions or failures to act constitute a breach


A Bar Brother said:
And I will repeat again, Dassault doesn't want any type of liabilities.
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Can you reference to a link or statement that Dassault actually said that without some form of proviso attached to that statement.

A Bar Brother said:
Basically, all the rules and regulations were available in open source for years. When Dassault signed up for the MRCA deal, they accepted all the rules and regulations. The liabilities were part of that.
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This point has already been addressed in post #1754. You should directly rebutt the facts as laid out in that post.
 
A

A Bar Brother

Junior Member
Brumby said:
Simple. You should remember what you write.



In your own words, BAE paid not because there was manufacturing delays but BAE provided defective tools that led to manufacturing delays. In this case specific performance breach was established and hence BAE paid for liquidated damages.



This type of commercial arrangement is normal supplier relationship and when there is failure to deliver on time or there is failure to meet prescribed quality standard with the product, the negotiated penalties kick in. It is an everyday business relationship within a supply chain around the world. There is nothing unique in any structured business arrangement that legal safe guards cannot be negotiated and build in provided the terms establish what actions or failures to act constitute a breach




Can you reference to a link or statement that Dassault actually said that without some form of proviso attached to that statement.



This point has already been addressed in post #1754. You should directly rebutt the facts as laid out in that post.
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Dassault will commit to liabilities only with certain provisions that HAL won't accept. Otherwise Dassault will not commit to liabilities, which MoD won't accept.

Basically, Dassault wants to rewrite the RFP to favor them. Or they won't sign the contract. That's why the MoD says the contract has to stick to the RFP.

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Asked about the long stuck deal for buying medium multi-role combat aircraft (MMRCA), the minister, in an interview to Headlines Today, said: "Ultimately, it has to fit the RFP... if it does not fit the RFP, nothing can be done."
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It means Dassault wants no liability.

OTOH, BAE has signed the same liability clauses.

You are talking about contract obligations and commitments that one European country has no problems with, but another does, and you are favoring the one that has problems. If Britain had no issues, they why should the French?
 
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