City and County of Denver v. Frueauff

• Decision Date: 07 January 1907
• Citation: 88 P. 389,39 Colo. 20
• Parties: CITY AND COUNTY OF DENVER v. FRUEAUFF.
• Court: Colorado Supreme Court

88 P. 389

39 Colo. 20

CITY AND COUNTY OF DENVER v. FRUEAUFF.

Supreme Court of Colorado, En Banc.

January 7, 1907

Error to County Court, City and County of Denver; Ben B. Lindsey Judge.

H. D Frueauff was prosecuted for violating an ordinance of the city and county of Denver. From a judgment discharging the defendant, the city and county of Denver brings error. Affirmed.

The defendant in error, a merchant carrying on a legitimate business in the city of Denver, was charged with violating ordinance No. 62 of the series of 1904 entitled 'A bill for an ordinance to prohibit gift enterprises, defining the same, and providing penalties for the violations of said ordinance,' which said ordinance is in words and figures as follows, to wit:

'Section 1. It shall be unlawful for any person, persons partnership, association or corporation to engage in, aid abet, or patronize any 'Gift Enterprise' as herein defined.

'Sec. 2. A 'Gift Enterprise' as herein employed is defined to be and shall include the selling, giving, presenting or distributing of any stamp, trading stamp, coupon or other device which shall entitle the purchaser of property, goods, wares, or merchandise to demand or receive from any person, persons, partnership, association or corporation other than the vendor any article, property, goods, wares, merchandise or money other than that actually sold to the purchaser; or the delivery to any person, persons, partnership, association or corporation by any person, persons, partnership, association or corporation other than the vendor of any article, property, goods, wares, merchandise or money other than that actually sold, upon presentation of any such stamp, trading stamp, coupon or other device; or the issuing, selling, giving or distributing to any person, persons, partnership, association or corporation of any stamps, trading stamp, coupon or other device by any person, persons, partnership, association or corporation engaged in any trade, business or profession, with the promise expressed or implied that he, they or it will give to the person presenting to him, them or it, such stamp, trading stamp, coupon or other device any money or anything of value without receiving from such person the value thereof, or make to any such person, persons, partnership, association or corporation any concession or preference in any way on account of the presentation of such stamp, trading stamp, coupon, or other device; or the distributing or presenting by any person, persons, partnership, association or corporation engaged in any trade, business or profession to any person, persons, partnerhip, association or corporation dealing with him, them or it any such stamp, trading stamp, coupon or other device in consideration of any article or thing, purchased of or any service performed by him, them or it; or the selling or offering for sale of any real estate or article of merchandise of any description whatever, or any ticket of admission to any exhibition or performance or other place of amusement, with a promise expressed or implied to give or bestow or in any manner hold out the promise of the gift or bestowal of any article or thing for and in consideration or a purchase by any person, persons, partnership, association or corporation, of any other article or thing, whether the object shall be for individual gain or for any other purpose; and the term 'Gift Enterprise' shall also include the premium stamp, periodical ticket, trading stamp and similar schemes and devices wherein by means of stamps, checks, tickets or other device certain merchants, manufacturers and their customers are exploited.

'Sec. 3. Whoever shall violate any provision of this ordinance shall for each offense, on conviction thereof in any court of competent jurisdiction, pay a fine of not less than one hundred dollars ($100.00) or more than three hundred dollars ($300.00), or be imprisoned in the common jail of the city and county of Denver for a term of not less than thirty (30) days or more than ninety (90) days, or both such fine and imprisonment, in the discretion of the court.'

The case was tried to the court upon an agreed statement of facts, which, so far as necessary to a decision of the case, is as follows:

'(2) That the Sperry & Hutchinson Company is a corporation organized under the law of the state of New Jersey, and doing business in the city and county of Denver, in the state of Colorado.

'(3) That the defendant, at all of the times hereinafter mentioned, was, and now is, a resident of the city and county of Denver, and engaged in a mercantile business in the city and county of Denver, and selling and disposing of goods, wares, and merchandise at retail and otherwise, and is carrying on a large business.

'(4) That heretofore the said the Sperry & Hutchinson Company and the said H. D. Frueauff entered into a memorandum of agreement which is in words and figures as follows, to wit:

"Memorandum of Agreement.

"This agreement, made the ___ day of _____, 190_, by and between the Sperry & Hutchinson Company, a corporation of the state of New Jersey (hereinafter called the Company), party of the first part, and _____, a _____, of _____, doing a general _____ business at _____ street, _____, state of _____, party of the second part, witnesseth:

"That in consideration of the mutual promises and agreements hereinafter contained, said parties agree as follows:

"Said Company agrees to advertise in the directory in its trading stamp books distributed in the city or town of _____, the name, business, and aforesaid business address of the party of the second part; to deliver to the people of said city or town said books, and explain to them how to use the same; to maintain a store for the purpose of redeeming its trading stamps when issued in the regular way by the party of the second part, and others duly authorized to issue the same; to keep on exhibition in said store goods and merchandise with which to redeem said stamps when presented in said

books in lots of nine hundred and ninety (990) stamps, and according to law, collected in the manner prescribed and subject to the conditions in said books, and to use its best endeavors to promote the cash sales and trade of the party of the second part.

"The party of the second part agrees to order and receive from said Company its green trading stamps in lots of not less than _____ pads per lot, each pad containing five thousand (5,000) stamps, and to pay upon delivery thereof the sum of _____ dollars per pad, for the use of said stamps as an advertising medium, and agrees to supply said stamps from the aforesaid business address as an inducement for cash trade to all persons who pay cash for purchases; to give out said stamps as follows, and not otherwise to dispose of the same without the prior consent in writing of said Company, viz.: To give to each customer one stamp for each and every ten cents represented in the retail price of merchandise, for which cash is paid by said customer.

"Said party of the second part also agrees to display signs furnished by said Company which read, 'We Give S. & H. Green Trading Stamps,' or otherwise, in the windows and other prominent places about its stores, and agrees not to procure said stamps in any way except direct from said Company, either during the term of this contract or at any time, and also agrees to mention favorably the use of said stamps in all newspaper and other advertisements published by or for it; and not to use any other coupons, trading stamps, or similar device during the term of this contract, and not to join in any combination of merchants for the purpose of discontinuing the use of said Company's trading stamps.

"It is mutually agreed between the parties hereto that the property in and title to said stamps and signs shall remain in the said Company, and shall not in any event pass to the party of the second part, or any other person, firm, or corporation, and that this agreement shall remain in force for one year from the date of its execution, and shall be considered renewed for an equal period from year to year, unless written notice to the contrary be given by either party to the other at least thirty (30) days prior to the yearly periods of expiration; and, provided such notice be given by said Company, said Company may thereafter omit from its directory and advertisements the name of the party of the second part.

"It is mutually understood and agreed that this contract is made for the benefit of the public as well as of the parties hereto, and subject to legislative restriction.' * * *

'That in accordance with the provisions of said contract, the said H. D. Frueauff did order and receive from the Sperry &amp Hutchinson Company pad or pads of green trading stamps, each pad containing not less than 5,000 stamps, as in said contract provided, and has for some months last past and is now engaged in supplying and giving out to customers said green trading stamps, in the following manner, to wit: To each customer one stamp for each and every 10 cents represented in retail price of merchandise for which cash is paid by said customer, and that on the 10th day of December, A. D. 1904, the said defendant was thus engaged, and did give out green trading stamps to each customer who called for the same, one stamp for each and every 10 cents represented in retail price of merchandise for which cash was paid, not only to one, but to numerous, customers of the said defendant's place of business on said day, and the said defendant has not disposed of the green trading stamps so purchased from said Sperry & Hutchinson Company in any other manner, and the said defendant has also displayed, and is now displaying, and did display...