CITY MILK SUPPLY

Dominion, Volume 14, Issue 181, 27 April 1921, Page 6

CITY MILK SUPPLY

LAST YEAR’S SHORTAGE

COUNCIL SUED BY VENDORS PROSPECTS FOR THIS WINTER Ab a sequel to the milk shortage in Wellington in the winter of last year, litigation was brought on in the Supreme Court yesterday, involving a claim for substantial damages lagainst the City Corporation. The plaintifis, the Wellington Milk Vendors’ Association, contended that through default on the part of the Wellington City Corporation—the defendants in the action—they had raceivcdi short deliveries oi milk for distribution, to their customers. In consequence of this, the plaintiffs, who were in charge of No. ■ 3 block Newtown, Lyall Bay and Boseneath—proceeded against the corporation with a claim for ,£1299 15s. 2d. damages. His Honour Mr. Justice Rood was ou the bench. Mr. M. Myers, with him Mr, Mazengarb, appeared for the plaintiff company,'■and Mr. J. O’Shea, city -solicitor, for the defendant corporation. Thu statement of claim set out that in June, 1919, the corporation split the city UP into four districts under the milk supply scheme, and entered into agreements with, tho licensees of those district as to the continued supply to the consumers. The corporation had been given exclusive rights to sell milk under the milk regulations or 1918, and under those regulations gave exclusive rights to the licensees, which rights were later extended to three years, from J uly 1919. Under the agreements the corporation contracted to supply the 'licensees with all such milk and cream as they should require to supply the consumers in their districts in the city. The agreements contained certain clauses excusing the corporation from compliance with tho clause relating to supply to the licensees, as in cases of epidemic, accident, drought, or other causes preventing the performance of the contract. The licensees were entitled to profits on a sliding settle on the sale of milk—on sales up to 5 gallons, 7d. per gallon; b to 10 gallons, sd. per gallon; 10 to 20 gallons, 3d. per gallon; over 20 gallons 3d. per gallon; and on each gallon of cream, ss. The licensees made their claim for £1299 odd for short delivery to them by the corporation, on the score of tho difference between the supply during the months, of February and' March, 1920, and the months of April, May, June, and July of that year. Accordingly, the plaintiffs claimed a profit of 7d per gallon on tho quantity which they alleged was short delivered during the latter period. The Company’s Loss. In opening, Mr. Myers pointed out ■that the plaintiffs were prevented under their agreement from obtaining milk and cream from any source outside of the City Corporation. The plaintiffs were also bound to deliver- to the consumers in their district all the milk and cream they ordinarily required. In the winter of 1920 there was a shortage of milk available to tho citizens of Wellington. This put the public to no small mconyenietnoe, and the quantities supplied to the plaintiff company falling short of the normal supplies, the company was involved in considerable loss in profit. Save in exceptional circumstances ■pecifically outlined—which it was conBidered did not come within tho province of the present action —the corporation wasi under an [absolute obligation to maintain the full supply of milk to the plaintiff company. The plaintiffs would show, continued counsel, that during tho Bhortage complained of, milk was available for the corporation, but the corporation did not choose to take it. The company Lad alternative but to ration its supplies, and, although' its daily gallonage was cut down, the same staff and equipment had to be retained as was required to deliver the normal gallonage. The company, in its claim, assessed damages on the basis of 7d. per gallon all round on the total quantity of milk short-delivered, but it admitted that this would have to bo revised according to the sliding schedule of profit? per gallonage outlined in the statement of claim. Mr. O’Shea: It is quite patent to anybody that the claim for 7d. a gallon is ■untenable. Mr. Myers went on to detail the shortages in delivery to the plaintiff company which, he said, were as follow. —April, 1578 gallons; May, 5498 gallons; June, 20,569 gallons; July, 9144 gallons—a total of 36,789 gallons. The cream shortage for that period amounted to 907 gallons. His Honour: Were any steps taken by the vendors to obtain permission to purchase milk elsewhere? Mr. Myers replied that their . hands were tied by the Act. Counsel said that the corporation could have obtained all the niilk it required from Featherston at a price of Is. 6d. per gallon at the factory in Featherston. The corporation did not take advantage of this offer, as it considered the price excessive. The position in' a nutshell was this: The Featherston company wanted la. 6d., the corporation offered only Is. 3d.,, and the Board of Trade fixed the price at Is. sd. per gallon. It might or might not have been commercially profitable for the corporation to have taken the milk at Is. 6d. per gallon. That was no concern of the plaintiff company. Tho corporation had entered into an obligation to supply the Wellington milk vendors with milk. This obligation had. not heen fulfilled in its entirety. The corporation could have got the milk—the fact that the . price at which it was offering was considered too high was no concern of the contract. . In answer to a query from His Honour, Mr. Myers said that the position was going to be. worse than ever this winter. The farmers in the country did •.not as a rule go in for winter herds. To product: winter milk involved tho farmer in a whole lot of expense and extra trouble. The result was that the farmers would not take on winter milk production unless they received adequate remuneration for their trouble and outlay. “If,” remarked counsel, “tho corporation is not prepared to treat the farmers fairly and reasonably it won’t get the milk; or if it wants to get milk ft must go further afield than at present.” Mr. Myers added that in theory no doubt the city’s milk system was a good one, but it required to be handled as a business concern. Mr. O’Shea: We may not pet the milk this year, but we will get it next year when the price of butter-fat goes down, and those gentlemen may not be so wealthy. His Honour commented that a shortage of milk in Wellington this winter might go hard with the people. Mr.-O’Shea : When things tro down they (the farmers) will be in a different frame of mind. Mr. Myers: They are so dissatisfied, rightly or wrongly, with the treatment they are receiving from tho corporation .that a number of them are giving up the winter herds which they have established in order to supply winter milk to Wellington. Mr. O’Shja: There is no doubt that we are not receiving o.ny assistance from tho Featherston people. Mr. Myers: I understand that the Board of Trade has unproved not Is. 5d., but 2s. as the price for milk. A Question of Output. ■Evidence was then given by Charles John Duffy, managing director of the ' company who stated that he considered the average daily output of his company during the period in question was 2000 gallons, but to that amount tho corpora--.tion could not agree, and it was therefore reduced for the purpose of the claim. ,

Cross-examined by Mr. O’Shea, witness admitted that when he went to the Featherston farmers he considered that his company was entitled to 7d. for every gallon short-delivered. Mr. O’Shea: Mould vou deny that the corporation had a surplus of milk fast year lip to May 1G which it/ was separating, as it could not distribute it? Witness: I don’t know whether I could prove it. . v Further cross-examined, witness admited that on various dates in April and May his company had returned varying small ouantities of milk to the corporation, but added that the plaintiffs were claiming fer an average daily shortage. Clementf'Jobn Carlyon, secretary of tho Featherston Co-operative. Dairy Company, was the next witness for the plaintiff company. He stated that if sufficient inducement were offered, three times tho quantity of milk now obtained by tho corporation from Featherston could lie got from there. Mr. O’Shea: What quantity? Witness: I should say easily 3000 gallons in June. Mr. O’Shea: What is the inducement that would be needed? Witness: That is a matter for arrangement. At this stage further hearing of the case itas adjourned till this morning.