FLOURMILLING CASE

Gisborne Times, Volume LXI, Issue 9852, 3 November 1924, Page 3

FLOURMILLING CASE

OPENING OF THE DEFENCE,

“AGREEMENT NOT CONTRARY TO PUBLIC INTERESTS.”

DUNEDIN, Nov. 1. In tho flour milling case the defence was opened by Mr Myers, who submitted that the agreement was not contrary to public interest merely because it was in restraint of trade. A scheme reasonably necessary Blithe protection of the ' industry and intended to keep up prices, did not constitute an offence unless the price fixed was unreasonably high. Counsel was unable to see how the case came under sections three and four of the Act. These sections were intended to meet the case of certain organisations that bad a partial monopoly., whose system was to sell goods on such terms that after a certain period, if customers had not bought the same class of goods from anyone else he was given a rebate. Section four was to elm is r a converse case, that of refusing consideration. Air Myers continuing said the company at the outset disclosed the nature of its operations to the Board of Trade and the Department of Industries and Commerce, which fully understood the terms of agency of the agreement. This was shown by the answers given by Ministers m the House, it was in the NcvemberDcceiriber period of 3923 that the protests were made by Southland bakers. Some months later action was commenced. There were no disaffected bakers outside Otago and Southland. Counsel contended that tho action against Distributors Ltd. was entirely unnecessary, lhe formation of Distributors Ltd. brought about a. reduction of four sinkings a ton in price of bran and pollard without any corresponumg increase in the price of hour. The formation of Distributors Ltd. had made it possible to stabilise .various allied industries. Had it not been for the establishment of Distributors Ltd. the wheat agreement of 1921-24 would not, ami could not have been made, and chaotic conditions would have resulted. But for the stabilisation of the industry New Zealand would ha veto import most of its wheat bran and pollard from Australia. At the time Distributors Ltd. was formed it was presufed that the embargo on Australian wheat would be removed at the end of February 1923. 'Lhe, agreement contained clauses providing against a general output of poor quality flour. It was not denied that serious inconvenience was caused Southland, but the position would have been as bad under wider price competition. Air Alycrs, in concluding his address. which was on behalf of all the defendants, said, inreply to the Judge, that there was not a. sunstnntial profit made bv Distributors Ltd.

Evidence for the defence will betaken on Monday.—P.A.