Faitoute Iron & Steel Co. v. City of Asbury Park

• Decision Date: 27 March 1941
• Citation: 19 N.J.Misc. 322,19 A.2d 445
• Parties: FAITOUTE IRON & STEEL CO. et al. v. CITY OF ASBURY PARK.
• Court: New Jersey Supreme Court

19 A.2d 445

19 N.J.Misc. 322

FAITOUTE IRON & STEEL CO. et al.

v. CITY OF ASBURY PARK.

Supreme Court of New Jersey, Essex County.

March 27, 1941.

Syllabus by the Court.

1. Price maintenance contracts made under the Fair Trade Act, R.S. 56:4-3 et seq., N.J.SA. 56:4-3 et seq., by a distributor of products sold under the trade-mark of a manufacturer or producer are valid although the distributor acts without the authority or consent of the owner of the trade-mark. Schenley Products Co. v. Franklin Stores Co., 124 N.J.Eq. 100, 199 A. 402, followed.

2. The minimum resale price established pursuant to contracts made under the Fair Trade Act must be uniform throughout the state and uniformity cannot be obtained unless the manufacturer or distributor effectively binds all retailers selling the product to maintain the established price.

3. Price discriminations between classes of retailers or classes of consumers are not permissible unless specifically authorized by statute.

4. Price maintenance contracts which are the result of agreement between manufacturers or producers are not valid under the Pair Trade Act or the Sherman Anti-Trust Act, as amended, 15 U.S.C.A. § 1-7, 15 note and are not enforceable.

5. Various types of combinations examined and found to be an abandonment of the price structure within Bathasweet Corporation v. Weissbard, 128 N.J.Eq. 135, 15 A.2d 337.

Action by the Faitoute Iron & Steel Company and another against the City of Asbury Park on bonds and interest coupons issued by defendant. On defendant's motion to strike the complaint.

Order granting motion.

Arthur T. Vanderbilt, of Newark, for plaintiffs.

Ward Kremer, of Asbury Park, for defendant.

JOSEPH L. SMITH, Supreme Court Commissioner.

This comes on a motion of the defendant to strike the complaint filed herein as setting forth no legal cause of action. The plaintiffs' suit is to recover on bonds and interest coupons issued by the defendant and held by the plaintiff. The grounds set forth in the motion to strike the complaint are that the complaint does not set forth a legal cause of action; that the complaint does not aver that the plaintiffs have obtained the permission of the New Jersey Supreme Court to institute the present suit; that the defendant has in operation a refunding plan controlling the plaintiffs' claim; that the plaintiffs are controlled by the terms and provisions of N.J.S.A. 52:27-34 et seq.; and that the plaintiffs have not obtained permission of the New Jersey Supreme Court to institute the present suit.

The procedural propriety of the motion is questionable in view of the fact that the complaint, on its face, without the qualification of extraneous matters, does set forth a cause of action, and the grounds stated in the motion would have been stated more properly by way of an answer. However, all the relevant facts are admitted by both parties and concededly there are no issues of facts to be determined, and solely a question of law is left for determination. Under these...