ALLEGED PROFITEERING

Southland Times, Issue 18852, 18 June 1920, Page 6

ALLEGED PROFITEERING

CHARGE AGAINST THE D.I.C. THE PRICE OF A COAT. (Per United Press Association.) CHRISTCHURCH, June 17. At the Magistrate’s Court to-day the General Drapery and Importing Company of New Zealand, Ltd. (the D.1.C.), was charged with having committed the offence of profiteering by offering for sale on April 27, 1920, to George Hart Christie, a girl’s rainproof coat at the price of 45/-, which price was unreasonably high. The information was laid by Mr' Christie, secretary of the Christchurch Prices Investigation Committee under section 32 of the Board of Trade Act, 1919. Mr S. E. McCarthy, S.M., was on the bench. Mr W. C. MacGregor, K.C., with him Mr A. T. Donnelly, appeared for the prosecution, and the defendant company was represented by Mr C. P. Hkeneit, K.C. A pica of not guilty was entered.

Hr MacGregor outlined evidence that would tie called. A .girl's coat which cost the D.I.C. 17/4 plus 20 per cent., or 21/6, had been offered for sale at 45/-, a profit of 109.3 per cent, on the coat. Three other coats of the same purchase had been bought and offered for sale at the following prices, (he approximate cost being mentioned first in each case (32/51 sale price 52/6; (-15/31 75/-; (3S/5) 75/-. Counsel submitted that that showed a clear breach of the Act. The average profit on cost asked for the four coats was 79 per cent. Evidence on behalf of the prosecution was given by Mr Christie, and for the defence by Oscar Clarence Cox, manager of the D.1.C., and Mary Helen Wraight, head of the underclothing and children’s outfitting department. The last mentioned witness said that, after she purchased this line of samples she reconditioned one of (lie coats. To pay its way her department should return 50 per cent, to 00 per cent, on cost. They did

not always get that. This range of coats had been picked over before she purchased it. She priced the line on the accepted trade custom. Providing that the samples were bought cheap they were priced on one’s own judgment, bearing in mind that any other firm which had bought goods from this range of samples would have had to pay landing costs of from 50 per cent, to 55 per cent, ou the Home cost at the tin e of the order. Her object in pricing was to give good value. That was the manager’s policy. This coat, was a novelty coi'.t and likely to be more saleable, so she fixed its price higher in comparison than the prices of others in the line. The cut and fashion of a coat counted for more even than good material. She thought that in marking one coat at 45/- she was giving the public good value, and the price was fixed having regard to the saleability of the line as a whole. In his address to the Court, Mr Skerrett pointed out that this was the purchase and sale of a job lot. The selling prices had bean fixed in the ordinary course of trade. What profits would be made on this line of samples was purely a matter of conjecture. It could not lie determined until the last coat had been sold, and possibly some would have to be sold even below cost. In the purchase of job lines or bankrupt stock it was impossible to fix some definite rate of profit for each article. In fixing the selling price regard must be had to market value, and the risk of non-saleability of the remaining articles in the line must also be considered. Unless a trader did that he would ultimately end in bankruptcy. The gross profit on cost originally fixed for the whole line was 78.5 per cent. As it cost about 60 per cent, to pay the department’s way only IS per cent, was left to cover the certitude of sale. The Magistrate reserved his decision.