PROFITEERING CASES.

New Zealand Herald, Volume LVII, Issue 17444, 14 April 1920, Page 7

PROFITEERING CASES.

♦ DETERMINING OFFENCES. FACTORS TO BE CONSIDERED. Rome interesting comments on the question of what constituted reasonable profits were made by Mr. E. Page, S.M., in Wellington on Monday in the course of a judgment in which he recorded a fine of £100 and costs against Bertie Smith, grocer, for selling a bottle of Mellin's food for 3s 6d. r - It -was not easy, said Mr. Page, for the Court to say in precise figures what was a reasonable rate of commercial profit in respect of any particular goods. Primarily particular goods must be looked to in regard to their nature and the frequency with which they were turned over, theii liability to breakages, or depreciation 01 loss in value, fluctuations in market risk, handling, and all such matters in order to ascertain at what rate they could be handled to produce a reasonable rate ol commercial profit. But in deciding what was. a reasonable rate he thought that the ultimate test must be the rate of interest that handling of goods will produce upon the capital invested in business after making provision for proper outgoings and contingencies. When this rate of interest was ascertained the question as to whether the rate was a reasonable one was not so difficul* to determine. It seemed to him that the Act was not intended to disallow reasonable latitude in fixing prises. A trader was entitled, he thought, to exercise within reasonable limits his discretion in deciding what goods or what classes of goods he would sell at a low rate of profit, or even at a loss, or what goods he would sell at a higher rate of profit, if in the result it was shown that his legitimate business operations on his whole business did not result in an undue profit. It seemed to him that that fact was an element to be taken into consideration in deciding whether an unreasonably high price had been charged fir any particular goods. General profits must be considered in the present case. Returns from defendant's business over certain periods had been put in. and he thought the Court was bound to consider these when deciding the question.