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McCunn v. Fleming & McCaig Inc.

Decided: May 27, 1964.

JAMES M. MCCUNN & CO., INC., A CORPORATION, APPELLANT,
v.
FLEMING & MCCAIG, INC., A CORPORATION, AND DIVISION OF ALCOHOLIC BEVERAGE CONTROL OF THE STATE OF NEW JERSEY, RESPONDENTS



Conford, Freund and Sullivan. The opinion of the court was delivered by Sullivan, J.A.D.

Sullivan

This case involves an appeal by James M. McCunn & Co., Inc. (McCunn), from the conclusions and order of the Acting Director (Director) of the Division of Alcoholic Beverage Control requiring McCunn to sell and continue to sell to Fleming & McCaig, Inc. (McCaig) alcoholic beverages "on terms usually and normally required" by McCunn.

The appeal was originally argued in September 1963, as a result of which we continued the Director's order, retained jurisdiction of the appeal, but remanded the matter for additional findings and conclusions. Our opinion in 81 N.J. Super. 97 (App. Div. 1963) sets forth the factual background and details of the case.

Following the remand the Director filed "Supplemental Conclusions" in which he determined:

(1) That McCunn's establishment of a sales quota for its distributor was inimical to the meaning and purpose of the Alcoholic Beverage Control Act and was therefore an invalid objective criterion.

(2) Assuming a sales quota or goal was not per se invalid, the 8,000-case figure was unrealistic in the light of past sales and was therefore arbitrary and unreasonable.

(3) McCunn had not offered McCaig a reasonable opportunity to demonstrate its ability to handle the distributorship.

(4) McCunn was not justified in refusing to sell to McCaig in view of the relationship between the parties and their experience with each other.

(5) McCunn's decision "to discontinue the distributorship to McCaig and invest it in the Reinfeld Company was not based upon terms usually and normally required by the importer since the criterion applied to McCaig was not similarly applied or sought to be applied to the Reinfeld Company."

After the filing of the supplemental conclusions, additional briefs were submitted on behalf of the parties and further oral argument was had. At the latter hearing, the Attorney General argued, as had McCunn on the original appeal, that the Director's order directing McCunn to "sell and continue to sell * * * on terms usually and normally required by the respondent" was broader than permitted by the legislative delegation and should be modified so as to be confined to a direction to McCunn to complete the sale of the particular order which McCaig had presented and McCunn had refused to fill.

Our conclusion is that the Director's order should be affirmed for the following reason.

The scope of the order was warranted by the circumstances. The evidence is clear that McCunn's refusal to sell to McCaig was a refusal to have any further dealings with McCaig and was not limited to the one sale. An order from the Director to complete the particular sale would not have afforded McCaig any real relief. As to the statutory power of the Director to enter an order of such scope, we note that the terms of the order in question to "sell and continue to sell * * * on terms usually and normally required by respondent" were taken verbatim from the Division order reviewed in Canada Dry Ginger Ale, Inc. v. F & A Distrib. Co. , 28 N.J. 444 (1958). True, ...


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