THE SUGAR CASE.

Dominion, Volume 7, Issue 2128, 21 April 1914, Page 5

THE SUGAR CASE.

FAIRBAIRN. WRIGHT & CO'S SUIT.

HEAVY DAMAGES SOUGHT.

WHOLESALE TRADE DEALS.

Allegations of. sugar trust operations are made in a case which is -now'.before the Court of Appeal. The Christcliurch firm of Fa'ifbairn, Wright and Co. have claimed damages from Lovin and! Co., Ltd., of .Wellington, .but before tho Supreme' Court hears the case the Appeal Court has been called on to decide whether Fairbairn, Wright; and Co.'s statement of claim discloses a cause of action.

Allegations and Claim. The statement of claim sets out that Levin and Co. were members . of the Merchants' Association of New Zealand, the objects of which included restriction of competition among its members in the sale of sugar and the controlling of the supply and tho price of that commodity. : ■ The defendant, it is alleged, was not only a member of tue ring, or combination, but acted as agent of the sugar combination in respect of the purchase of sugar from tho Colonial Sugar Refining Company. The. defendant and the other, members of the ring entered into an agreement among: themselves as to the prico at which, and the terms upon which, they would resell the sugar purchased by them irom the Colonial Sugar Company, and tho ring constituted a commercial, trust. .No .single purchaser in New Zealand purch&ee'd sufficient sugar to obtain the maximum diecount .allowed by the company's scale of discounts, and in order to enable the maximum discount to be obtained the defendant and the other members of the ring and tho Merchants' Association induced the Colonial Sugar Company tor permit (and it did permit) all purchases made by members of the Merchants' Association and by the members .of .the said eugar combination to be aggregated as if made by a single purchaser and to allow (and it.did allow) discount to each of these' purchasers accordingly. No 'purchaser of sugar in New Zealand could obtain tho maximum discount except by becoming a member of the Association, or .of the ring, and could become a member only with the consent of the Association or ring. Tho; Colonial Sugar Company refused to supply sugar to the plaintiffs except on comparatively, disadvantageous terms for the reason that the plaintiffs were not members of the Merchants'. Association or tho ring, and the defondant company aided, abetted, and counselled the Sugar Company. For the same reasone alto' the' defendants refused! to sell the plaintiffs sugar. The defendants conspjred with the Merchants' Association arid the, Sugar.Cbm.pany to monopolise the sugar supply and control its price, with.' the. object of excluding or driving out the plaintiffs froni the wholesale trade in sugar, or greatly reducing their trade therein because tho plaintiffs would not become parties to the conspiracy. Til© result was that the plaintiffs were prevented from obtaining; sugar for their business on terms which would, enable themvto- make the'■ profit they wbuld hare made but for the monopoly,.'. Tho plaintiffs claimed £8453. The special damages claimed ■ were: —(1) £3527 for loes of profit on the salos of sugar to their customers actually made by the plaintiffs between October 1, 1911. and March" 31, 1913. (2) £2925 for loss of profit on the sales of sugar which the plaintiffs would but for the wrongful acts, of the defendants have made between tho dates above-mention-ed. £2000 was claimed by way of general damages to the plaiiitiffs' wholesale business.'

The judges on the bench' were their Honour f tlio Chief Justice (Sir Robert Stout), Mr. Justice Edwards, and' Mr. Justice Sim. The Hon. H. D. Bell, K.C., with Mr. C.-P. Skerrett.K.C, and Mr. T\ Yoiing, appeared for Messrs. Levin and Co., Ltd. Sir John Findlay. K.O V *ith Mr. D. M. Jindlay and Mr. 0. Stout, appeared for Fairbairn, Wright and! Co.

The Other Side of the Case, ~ In opening argument, Mr. Bell .said that the action was brought by an individual trader who • complained that certain acts done in contravention of the Commercial Trusts Act had injured the plaintiff firm in its business. All that the plaintiffs s'ipd they had suffered they had suffereal with every trader iii the country who was riot a. member of the so-called ring. Counsel submitted that if the Commercial Trusts Act had conferred on an individual trader a right of aotion in respect of loss suffered by him by reason of the contravention, of the, Act by the defendant, then, and only then;, the statement of .claim .disclosedl a cause of action. Further, the allegations of combination, or conspiracy, were only relevant as allegations that the statute was contravened. They were irrelevant as any foundation of the plaintiffs' individual right of action. In support of t-hese propositions, Mr. Bell made, the'following seven submissions— But for the-statute, all that the defendant did was lawful and 1 within his commercial rights, whether these ■ acts caused loss to the plaintiffs or

not. ; ... No right of the plaintiff had been in- ■ vaded , either at common law or under the statute. The fact of combination or conspiracy to do an act was immaterial unless a legal right was invaded. No action lay, as a general rulo, for a conspiracy or a combination. The action was onlv for the acts done. • Combination, might be aggravation of damages, but it was not a cause of! action.' ■ . '■■ ' Where the whole intent and purpose of : the conspiracy, as distinct from its •'■. effect, "Was directed against the ■ plaintiff with tho object of causing injury to him, or to his business, then, if unlawful means were used, a right of .action might accrue. Tho statute had not created! a legal ?ight of the plaintiffs, < or a'.legal to tho plaintiffs, individually. It was ..passed far tho protection of the public against monopoly, and ' not for the benefit of an individual

trader. The remedy should ho a civil suit by the Orown to recover penalty. Mr. Bell proceeded to elaborate his points. Ho said l that the plaintiffs had no right to buy sijgar either from tho Colonial Sugar Company or Levin and Co. The latter firms had a perfect right to refuse to sell, and to refuse in combination. They had a perfect right to refuse one firm and agree to grant preferential torms to anyone clso. . It plaintiffs hnd a ri»:t to demand sugar from defendant's, that status had beenconferred, upon every trader in tho country, and upon every person who has paid more for his sugar than he would otherwise have paid. Argument was still boing heard when the Court rose for the day. Tho hearing will bd resumed this morning.