WEEKLY PAYMENTS

Evening Post, Volume CV, Issue 25, 30 January 1923, Page 8

WEEKLY PAYMENTS

CHARGES UNDER GAMING ACT '

DEFENDANTS CONVICTED

SECURITY FOR 'APPEAL FIXED.

Eeserved decision was given by Mr. E. Page, S.M., at the Magistrate's Court to-day, in the summons case in which James Hill and Royal Harrell, of the firm of Hill and Harrell, Courtenay place, were charged with establishing a scheme by which prizes were won by chance, and as an alternative, with managing a lottery. There were eight informations against each defendant.

At the hearing the prosecution was conducted by Sub-Inspector Cummings, and the defendants, who pleaded not! guilty,' were represented by Mr. 0. 0. Mazengarb. ■ .

In entering convictions, the Magistrate said that the defendants had recently come from Australia and established a scheme which they called "The Quality Clothes Service," under which canvassers were sent ont to induce the public to enter into a contract set out in certain advertising cards. Extracts from the contract are as follows:—"Every progressive concern must advertise in order to got your business. Instead of confining our advertising to the usual methods we have evolved. our advanced. advertising plan whereby the customer, himself is benefit; cd. Each week we deliver to some holder or holders of these advertising cards in districts where our advertising system is in operation, goods to the value of 90s. Payments stop immediately on selection and the selected customer can at any time obtain from us 90s worth of goods without any further payment. Persons selected are expected to advertise our business when convenient on consideration of these selections, this being in effect a payment for services. Selections are made in a manner deemed likely to prove most beneficial to the business of the company. Payments to be at the rate of 2s per week or more if desired. 'It is also agreed that two cards are not applicable to one purchaser. The purchase may be made at any time by the holder paying the difference between the amount already paid and the 905.. Should selection be made where an amount has been paid in advance, that portion paid in advance shall be refund; ed, but it is agreed that the money paid on this system in,th.e ordinary course is not to be , refunded, but to aPEIy to purchase only. Complete your payments any time you wish, and get your ,90s worth of goods. This card applies only to 90s purchases, but we will gladly supply any further article you lequire for cash." The subscriber was then advised to read the contract, as any private agreement between agent and customer could not be recognised. The opening payment was to be made to the agent, and thereafter to the company's authorised collectov. The card also-contained a considerable amount of advertising matter -eferring to goods and clothing.

"The effect of ".he scheme," contended the Magistrate, "is that customers pay 2s per week and stand their chance each week pf being 'selected' and of receiving without. further payment 90s worth of good*.,'-' There are at present some 500 subscribers to the scheme, so that the defendants are collecting about £50 per week..!. The.scheme is' not connected with an established clothing or drapery business. Considering, tlw amount that is being collected each week from customers, the value of the stock held by the defendants is negligible, and their practice is to give a 'selected' customer an order on a warehouse for the supply of 90s worth of goods The substantial question for consideration is whether the scheme comes within section 41 of the Gaming Act, 1908. It is established by authority that a scheme does not come within the section unless the prizes are gained, entirely by chance. If any skill or judgment on the part of the competitor may affect the result, then even though chance plays the main part the scheme is not within the section. ;. ."

After reviewing previous decisions on similar cases, the Magistrate said that, in the present case, the contract simply provided that "selections" were made in a manner deemed likely to prove most beneficial to the business and to the company. Nothing was said as_ to the basis on which it would be arrived at, but it was stated in evidence that in making a selection the defendants would choose a subscriber who was of good social standing, and who had a good position in life, and whose personality appealed to them. None of these features were embodied in the contract, but even if they were, he did not think the effect would be any different. There was no standard, and a subscriber had no means of knowninc what particular feature would influence the defendants in awarding their prize in any particular week. No opportunity was given to a subscriber to exercise any judgement, knowledge, skill, or industry with a view to qualifying for a prize or to improving his chances for it, and the whole decision wad left to the arbitrary unfettered whim of the defendants,, who micht adopt any temporary standard they chose, and. in fact, need not adopt a standard. As far as subscribers were concernedj each prize was gained by chance.

Addree&ins; the Court on the question of penalty, Mr. Mazengjarb said that the case was a bona fide test. The defendant had used this scheme in Australia, and proceedings had not been taken by the Commonwealth authorities. When they commenced business in New Zealand, they.were interviewed by the police and no, action followed, but after a Bubsequent interview, the informations had been laid. During the interim, the firm, thinking that it was acting according to law, had continued with the scheme. Counsel was of the opinion that the matter should be decided in the Supreme Court, and intimated that an appeal would be lodged. ' The Sub-Inspector pointed out that the defendants had been twice interviewed by tho police in connection with the same prosecution. The second interview was necessary to gain further jnformation. Although there was no such suggestion in the present case, there was nothing to prevent unscrupulous persons drawing the deposits collected and leaving the. eontry.

The Magistrate imposed a fine of £20 and costs on the first charge against each defendant.

Security of appeal was fixed at the amounts of the fines and £7 7s in each case. The remaining informations were withdrawn.