In a complex business dispute, Deloitte works with organisations and their lawyers in judicial and alternative dispute resolution forums, across a range of jurisdictions.

A global consumer goods company terminated a contract with one of its suppliers. The supplier (the Claimant) alleged that this was a breach of contract by the company, and it initiated arbitration proceedings at the ICC. The company commissioned Deloitte to provide an expert witness service, to provide an independent estimate of the amount of damages payable and also to rebut an expert report received from the Claimant as part of the arbitration process.

A Deloitte team reviewed the relevant clauses in the supply contract to establish the principles to apply to the calculation of economic loss in the event of a contract breach. It also reviewed management information from the Claimant of weekly supply forecasts and delivery data, to obtain an understanding of inventory movements. It then analysed the Claimant’s expert report to identify weaknesses in its assumptions arguments and calculations. Substantial shortcomings were discovered in this report, including unsubstantiated assumptions, accounting inconsistencies, misinterpretation, errors in calculation methods and a failure to include mitigation of loss. As a result, Deloitte’s estimate of the Claimant’s loss was much lower than the amount put forward by the Claimant’s expert.

The team prepared a detailed rebuttal report for the client, together with a supplementary report addressing the opinions of the Claimant’s expert. The dispute was eventually settled just before the arbitration hearing, for an amount much lower than the claim. Our instructing lawyers told us: “Your expert reports contributed decisively to our client’s success.”

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