ALLEGED PROFITEERING

Southland Times, Issue 18849, 15 June 1920, Page 6

ALLEGED PROFITEERING

THE CHRISTCHURCH PROSECUTIONS. (Per United Press Association.) CHRISTCHURCH, June 14. The charges instigated by the Prices Investigation Tribunal against several commercial linns came up for hearing before Mr 8. E. McCarthy, S.M., at the Magislrate’s Court to-day. Hastio, Bull and Pickering, of Christchurch, were charged with having sold to Ceorgc Hart Christie, the Prices Investigation Tribunal's investigating ollicer, a “Big Ben” alarm clock at the price of 255, which was unreasonably high. Similar charges were laid against the following Christchurch firms; —G. W. Drayton and Co., Ltd., Mason, Struthers and Co., Ltd., and E. Recce, Ltd. The offences were alleged to have occurred on April 20. A. J. White, Ltd., were charged with offering for sale on tire dale mentioned a “Big Ben” alarm clock at 255. The Drapery Importing Company of Christchurch were charged with having offered for sale on April 27 to George Hart Christie, a coat at 455, which price was unreasonably high. Brown and Bureau, Ltd., of Wellington, were charged with having unlawfully counselled another linn, viz. Hasl-ic, Bull and Pickering, Ltd., on March 1, to commit an offence under Section 32 of the Board of Trade Act, 1919, by asking and advising Hastie, Bull and Pickering, Lid., to offer for sale alarm clocks at a price which was unreasonably high. Brown ami Bureau were charged with a similar offence on the same date, it being alleged that they asked anti advised A. Minson, of Christchurch, to offer alarm clocks at an unreasonably high price. Mr \V, C. McGregor, K.C., of Dunedin, anti Mr A. T. Donnelly appeared for the Crown. Sir John Findlay, K.C., appeared alone for E. Recce, Ltd., Mr T. C. Skerret, K.C., appeared alone for Drytons, and they appeared jointly for A. J. White, Hastie, Bull and Pickering, and Mason Struthers and Co,

The rase against Hastie, Bull and Pickering was taken first.

Mr Macgregor, in opening for the Crown, said that in addition to local cases there were two charges against A. Brown and Bureau, who controlled trade in “Big Ben” alarm clock.' in the dominion, of counselling and procuring the sale at, unreasonably high prices. He defined the Act, and said that, for its put pose a price was unreasonable if it produced more than a fair and reasonable rate of commercial profit. The purchasing and selling prices and profit, in each ease were a-s follows;—Mason,Strut hers and Co., 12s and 255, and 108 per cent; Ilastic, Bull, and Pickering the same; A. .1. White, Ltd., 14s and 255, and 78 per cent.; K. Reece Ltd., 15s 9 and 25s , and 78 per rent.; Draytons 14s 3d and 255, and 75 per cent. His Worship would doubtless be told all about the cost of replacement, average profits, and (he hardship of isolating particular articles, but (he meaning of Section 32 was plain, and a wider relation of business custom ought become applicable only in considering the penalty. Evidence as to the purchase of clocks was given by George 11. Christie, secretary of the Christchurch Price Investigation Tribunal. Sir John I-indlay, for the defence, said that if the Crown’s contentions were right, then Sec;ion 32 had brought commercial chaos and the end of legitimate business;. The fixation of prices was no new scheme. It was done in connection with motor cais with beneficial results. He contended that the effect of fixing prices had been (o keep the price of “Big Ben” clocks at a lower price in the market, notwithstanding all the war conditions, than all other clocks competing against it. lie detailed the rise in the price of ‘'Big Ben,” and said that at 25s the profit was les - s than before the war. No increase' had been made in the price till stocks bought- at a low figure had been depleted. The question why did Mason, Struthers, who bought at 12s sell at 255, seemed difficult to answer, but the firm had bought, under a moral and legal obligation to sell at the price fixed by the manufacturer, and the only honourable course open to them was to comply with that obligation. Only by so complying could the firm be assured of getting further supplies. That was what differentiated the present cases from ordinary cases of profiteering. The Courts had already laid down (hat such contracts were legally unassailable, and that any departure from the conditions irajxised could bo made the basis of an action for damages. The net profits made by hardware merchants in the period 1914-19 ranged to 71 per cent. Counsel went into the questions of replacement values and depreciated currency, and in his concluding remarks said that somehow or other it suited a certain class of public man to make profiteer hunting the true and radical remedy for the cost of living. If they wanted to cure the high cost of living they must get down to fundamental causes. He had a profound resect for Mr W. G. McDonald, of the Board of Trade. Let such a man as Mr McDonald have his way and prepare regulations under Section 2(1 of the Act, and then a real advantage would be made. Section 32 would end in killing the Empire's honest industry’ and commerce. It would not affect the cost of living, and would leave the root causes untouched. Counsel for the defence were not present to meet this rase alone, but to fight for an important commercial principle. They asked that to the extent that. Section 32 killed business it should find no acceptance from his Worship, but that a broad and fair view should he taken of the whole of the circumstances. John Wilmot Duncan, manager for Brown and Duncan, said that owing io the trade in alarm clocks generally being disorganised by price cutting, a representative of the manufacturers of “Big Ben” had visited the Dominion, as a result of which a better sy T stem of selling clocks had been adopted. It provided for the fixing of the price for the wholesaler and retailer based on a fair margin of profit and keeping the price as low as possible to the customer. He detailed the various rises in the landed cost of the clocks, but had not concluded his evidence when, the Court adjourned till tomorrow.