Great Atl. & Pac. Tea Co., Inc. v. Bd. of Com'rs of City of Camden

• Decision Date: 04 February 1939
• Docket Number: Nos. 206, 212, 214, 225.,s. 206, 212, 214, 225.
• Citation: 4 A.2d 16,122 N.J.L 47
• Parties: GREAT ATLANTIC & PACIFIC TEA CO., Inc., et al. v. BOARD OF COM'RS OF CITY OF CAMDEN, and three other cases.
• Court: New Jersey Supreme Court

4 A.2d 16

122 N.J.L 47

GREAT ATLANTIC & PACIFIC TEA CO., Inc., et al.

v. BOARD OF COM'RS OF CITY OF CAMDEN, and three other cases.

Nos. 206, 212, 214, 225.

Supreme Court of New Jersey.

Feb. 4, 1939.

Suit by the Great Atlantic & Pacific Tea Company, Incorporated, the Acme Markets, Incorporated, Giant Tiger Corporation of Camden, N. J., and the Food Fair, Incorporated, against the Board of Commissioners of the City of Camden to set aside an ordinance imposing license tax upon operators of self service markets.

Ordinance set aside.

Argued January term, 1939, before BROGAN, C. J., and BODINE and HEHER, JJ.

Milton, McNulty & Augelli and John Milton, all of Jersey City, Caruthers Ewing, of New York City, and Feldman & Kittelle, of Washington, D. C, for Great Atlantic & Pacific Tea Company, Inc.

Bleakly, Stockwell & Burling and Henry F. Stockwell, all of Camden, and Gilfillan, Gilpin & Brehman, of Philadelphia, Pa., for Acme Markets, Inc.

Bleakly, Stockwell & Burling and Henry F. Stockwell, all of Camden (Einhorn & Schachtel) for Giant Tiger Corporation.

Stein & Mandel, of Union City, and J. Emil Walscheid, of Jersey City, for Food Fair, Inc.

Firman Michel and William J. Shepp, both of Camden, for defendant.

BODINE, Justice.

On April 14th, 1938, the Board of Commissioners of the City of Camden adopted an ordinance providing that no person, firm, or corporation should operate a self service market without obtaining a license therefor. A self service market was defined as follows: "Section 3. The term 'self-service market' as used herein is defined to mean: Any store or other structure wherein food, foodstuffs, groceries, canned goods, soaps, powders or other merchandise are sold at retail by a system or plan wherein the said foods, foodstuffs, groceries, canned goods, soaps, powders or other merchandise are displayed or exposed for sale on shelves, stands, platforms or counters or in bins or aisleways, in such a manner that purchasers are invited and permitted to make a personal selection of the food or merchandise sought to be purchased and to take the same into their possession, and are provided with baskets, carts or containers in which the merchandise may be placed, and carried or carted to a counter, place or exit point, where employes or agents of those conducting the business calculate the total cost of the foods, foodstuffs, groceries, canned goods, soaps, powders or merchandise, and wrap or place the merchandise in bags, cartons or containers and receive payment from the customer."

The license fee fixed was $10,000 per year, and upon a conviction for a violation of the ordinance it was provided that a fine of not more than $200 or imprisonment not exceeding 90 days, or both, could be imposed by the police judge.

At the public hearing before the adoption of the ordinance a letter was read as follows: "We are in favor of a license fee of $10,000 to be imposed on Self Service Food Markets. We believe this will be a protection to the neighborhood stores and advantage to our economic system."

Many individuals and organizations appeared in favor of the adoption of the ordinance and letters of protest were read from several of the prosecutors. The ban of the ordinance, it is to be observed, Ts upon the use of a basket or other container, personal selection of articles desired, the calculation of the total price of the goods selected and payment therefor before exit.

The Great Atlantic & Pacific Tea Company, Inc., has 30 retail stores in Camden. Three of the stores situate at the following addresses: 1618 Mt. Ephriam Avenue, 1125 Haddon Avenue and 2412 Federal Street fall within the ban of the ordinance. The merchandise in these three stores, of the same quality as that offered for sale in the other Atlantic & Pacific stores, is offered at somewhat lower prices. The housewife finds a saving of 4 cents on 12 pounds of flour; 1 cent on a pound of coffee or sugar or soap, or butter. There are savings of importance in cereals, canned and fresh fruit, vegetables and other articles of daily use. The saving from a more economic operation of the store is passed on to the consumer. The system of merchandising, however, is not new. For generations the residents of towns and cities in this country carried to, or had carried to, market the family market basket. It was filled with personal selections according to the needs and means of the household. Families with incomes below $2,000 are obliged to spend more than fifty percent of their income for food. Therefore, savings upon food are most welcome.

No Camden Atlantic & Pacific store does sufficient business to pay the license fee of $10,000. On the basis of the present profit rate it would require a business of $19,000 a week to meet the tax and none of the stores in the chain do any such amount of business.

The fixtures in the Mt. Ephriam Avenue store are worth $1200, the average inventory $4,000; the Haddon Avenue fixtures $2200, the average inventory $4500; the Federal Street store fixtures $5,000, the average inventory $5,500. All three stores were opened in 1938. Although there are baskets and self service as to some of the items offered for sale, this is not so as to many other articles. In all of its Camden stores, the Atlantic & Pacific made gross sales of $519,242 from March 1, 1938 to August 1, 1938, a period of five months. Its net profit averages 1 percent of sales. If all the profits were diverted and the company still retained the baskets and the check-up before leaving in the three stores in question, it would still fail of meeting the tax by nearly $20,000 each year. In the other stores, without baskets and the cashier clerk at the exit, it is possible for the customer to select and place purchases upon a counter where the prices are listed and paid.

The defendant's depositions show a sorry picture of financial losses to independent grocers, butchers and operators of delicatessen stores by reason of the advent of the chain store. There is, however, nothing to show that the self service stores are more harmful than the chain store generally.

The Acme Markets, Inc., leases premises at...