Friday, 6 January 2012

How the beer trade worked

Court cases. I love them. Because they often report on the inner workings of the beer trade. Something that doesn't show up in other sources.

No further introduction is necessary. The title of the article says it all

"ACTION AGAINST AN ABERDEEN SPIRIT-DEALER. BREWER'S DISCOUNT. An action was raised some time ago in the Aberdeen Sheriff Court at the instance of James Calder & Company, brewers, Alloa, against Thomas Donaldson, spirit dealer, King Street, Aberdeen, concluding for payment of £129 12s, being the price.of 32 hhds. of beer ordered by the defender from the pursuers through their traveller an 26th April, 1895, at the price of £4 per hhd. They also sued for the sum of £10 4s 8d, being the amount of freight and storage charge incurred by them to the railway companies in consequence of the defender's refusal to take delivery of the beer when tendered to him. The contract price of the beer was subject to a special discount of 40 per cent. if paid within six months, but in consequence of the defender's refusal to implement the bargain the pursuers sued for the full price. The defender in his pleadings denied having ordered 32 hogsheads of beer, but admitted having ordered 12, and pleaded that in any event he was entitled to the usual trade discount. The defender refused to take delivery of any part of the beer when tendered to him by the Caledonian and North British Railway Companies. Proof was led some time ago before Sheriff Brown, who has now granted decree against the defender for the sum sued for, under deduction of 35 per cent. from the contract price as trade discount.

In course of his note the Sheriff says:-The law applicable to the case is perfectly clear. The defender bought the goods in question, and was offered delivery, which he refused for no reason of any kind, and he must therefore pay the price. He is also liable for the loss occasioned by his failure to take delivery; and in taking back the beer and storing it in their own premises, to be there at the order and risk of the defender, the pursuers did what was best to avoid further damage. The other question in the case is as to the discount, the evidence bearing on it being meagre, and the authorities somewhat scanty. The view I take of the matter is that up to 35 per cent. it is to be regarded as a trade discount or abatement of the price, for which the purchaser is entitled to get credit at settlement, even although, as here, that should be made compulsorily. That doctrine seems to me to be expressed in the opinion of the Lord President and Lord McLaren, in the recent judgment of the Fist Division of the Court, in Buchanan & Co. v. Macdonald, 33 Scot. L., R. 200. Mr Calder seems to think that a different view is sanctioned by the custom of trade, but that is a large sum to be conditional on the mere accident of promptness in payment or to make a penalty for an appeal to the courts of law. The pursuers aptly quoted Duncan v. Aitchison & Co., 6 R. 582, and in re Cumberland, L. R. 3, Chan. Div., 803, but I think the principle which governs the case is that expounded in the judgment in the case first above mentioned. It appears to me also that that is an authority for making a distinction in this question of discount between the proportion which is to be regarded as a trade discount or abatement of the price and the increment which may fairly be considered as having been granted in consideration of prompt payment and of delivery being taken within a certain time. It is clearly proved that the additional 5 per cent. was given on these conditions, and as they were not qualified it has now been forfeited. The pursuers are, I think; entitled to full expenses, these having been incurred in proving the contract, and the defender having made no offer."
Aberdeen Journal - Friday 15 May 1896, page 7.

Let's get out a toothpick and pick the shreds of meat from that hearty meal.The beer had been sold by Calder's  traveller to a wine and spirit merchant. If this had happened 50 years earlier, I would have assumed that the purchase intended bottling the beer and then retailing it. That could still have been the case, but I can't be sure. Certainly the cask size - hogshead - suggests bottling. If he were reselling casks to private families, he'd want smaller ones than that.

It still tells us something about how Calder sold its beer. In this case it wasn't working through a local agent, but through its own traveller (salesman). Presumably he went around touting for orders which the brewery then dispatched by rail. (Note that it took two railway companies to get the beer from Alloa to Aberdeen. Ah, the joys of private railways.)

The figures don't seem to add up. 32 hogsheads at £4 a pop comes to £128. There's an extra 32 shillings in the price quoted - £129 12s. Clearly the price per hogshead  was 4 guineas (1 guinea = £1 1s), not four quid. Almost forgot, that makes the beer an 80/- (well, 88/- to be pedantic) Ale. William Younger's 80/- had an OG of 1061º in 1898. I would assume Calder's beer was of a similar gravity.

The defendant seems a bit shifty. Claiming he only ordered 12 hogsheads, refusing to take delivery of any but still trying to get his discount when forced to pay.

The Sheriff's ruling that 35% was a standard trade discount is significant, too. In "The complete practical brewer" (by Marcus Lafayette Byrn, 1860, page 117) it states that the trade discount was 15%. In the article Forty Years of Brewing (by A. W. Thomson, printed in "The Brewers' Journal 1940" page 55) says that the trade discount in 1900 was 33.33%. Based on that limited evidence, it looks as if the trade discount increased in the latter part of the 19th century. Was this the result of increased competition?

Another informative day for us all.


Barm said...

"Spirit dealer" might also just be a pub. It’s a common term in street directories for premises that are known to have been drinking shops.

Rod said...

I love the label for Calder's Imperial Stout. Would the anti-drink neo-abolitionist "health" lobby allow that today? You're having a Steffi.