§ Sir John Campbellrose pursuant to notice, to move 559 for leave to bring in a Bill "to Abolish Imprisonment for Debt, except in cases of fraud, and to amend the law of Debtor and Creditor." As the law at present stood in this country, power was given to any individual member of the community, over the liberty of another, who might, without the order of a judge, or the decree of any court, be deprived of his liberty, thrown into gaol, and subjected to the greatest, the most cruel extortion. This was a power not belonging to the ancient common law of the country, but which was introduced by statute long after the common law had existed, and which was not found in equal severity in France, or any other country on the continent. It was moreover a power, which, being lodged in the hands of all men indiscriminately, was in an especial degree liable to be abused. He would take the liberty of illustrating the nature and severity of the present law, by stating to the House a remarkable case which had recently come under his notice, and which was only a few days ago tried before the Lord Chief Justice of the King's Bench (Denman). In the course of the summer of last year, a foreigner of distinction, the Duke de Cadaval, arrived in this country, accompanied by his wife and family; after landing at Dover and proceeding to town, he took lodgings there. Shortly afterwards he received a letter from a person named Collins, which recounted great services done to the Duke, and intimating that his claims were considerable for these services. The Duke shortly afterwards received another letter demanding payment of the money alleged to be due, and threatening proceedings in case of non-compliance. The Duke was much alarmed, but not complying with the request, Collins swore an affidavit of the debt, stating it at 10,000l., went down to Falmouth, and, accompanied by a sheriff's officer, arrested the Duke, giving, or promising to give, the officer 50l. for making the caption. The Duke being much distressed at the prospect of a gaol and separation from his family, and being a stranger in the country, agreed, under the pressure of these fears, to give the plaintiff 500l. as present payment, which sum he obtained from the Portuguese Consul, and actually handed over in sovereigns in a bag to Collins, to be permitted to go out of custody; and the terms were drawn up in the shape of an agreement, by which it was stated that the 560 500l. was part of a sum of 16,200l. which the plaintiff claimed, and the action was to proceed in its usual course as to the remainder. Subsequently the Duke, finding the fraud that had been practised upon him, brought an action against Collins, and had the satisfaction of recovering the 500l. so fraudulently extorted from him. Was not that a state of the law which demanded the serious consideration of the House, with the view of adopting some change which should give greater protection to the public. He could state to the House from the returns which had been made of the money spent in connexion with the present law of arrest, and proceedings consequent thereon, that there was the enormous sum of 300,000l. annually expended by the respective parties debtor and creditor. These funds, which ought to be distributed among creditors, were idly spent among sheriffs' officers and their followers. He would state another consequence resulting from the present law; the cruel creditor who disregarded the feelings of his debtor had the priority, and had thus an advantage over an indulgent creditor who had a reluctance to resort to harsh proceedings. The harsh creditor swept away the whole of the debtor's property, and those who exercised feelings of kindness and indulgence had no remedy left them. The law, therefore, operated as a bounty on harshness and cruelty. The remedy he proposed for this was to abolish imprisonment, but to compel the debtor to abide by the judgment of the court, unless, indeed, it should appear that he was attempting an escape, when he should be compelled to give security. This would deprive the creditor of an opportunity of committing an injustice on his debtor without diminishing his remedy. When he thus proposed to deprive the creditors of their present remedy by imprisonment, he would on the other hand propose to give them greater facilities against the property of their debtor. By the present law there was this difficulty in the way of creditors. Suppose a creditor at Liverpool wished to proceed against a debtor who was about to go abroad, he must send up an affidavit of the debt to London, which must again be sent down to the country, by which lost time the debtor may have escaped by the sailing of the vessel. He would propose as a remedy for this, that on an affidavit being made of the debt and circumstances, a magistrate 561 on the spot should have power to grant a warrant against the debtor, whom the creditor should keep in custody until he could give security. According to the present law, be the debt ever so small, the debtor could be immured in gaol, and his liberty and exertions abridged, instead of being allowed to exert himself for its payment. His person might be enclosed within the walls of a gaol, but such imprisonment did not enable the creditor to get at the property of his debtor. The miserable consequence of this was, that our gaols were filled, the debtor became acquainted with vice and misery, and his mind was contaminated by the prison associates, with whom he was compelled to mingle. He would give the creditor, therefore, power to reach the property of the debtor, but not to inflict the evil he had described. There was another evil in the present law of arrest—it made no distinction between the honest and the fraudulent debtor. The unfortunate honest man who could not fulfil his engagements, was no better off than the man who could but would not pay. He should therefore propose that unless there was fraud, or the debtor refused to obey the judgment, or absconded, his person should not be molested; but if there were fraud, then the creditor should have the power to take the body of his debtor in custody. He was aware that creditors would not be willing to give up the advantage of arrest without an equivalent; by the present law a creditor only got indirectly at the property, but he would propose as an equivalent, speedy judgment—speedy execution; and that all the property should be taken for the satisfaction of the creditor. His first objection to the present law was, that in the case of bonds, bills, promissory notes, and instruments to which any one might have solemnly set his hand, there was great delay in proceedings when the creditor might need immediate execution. Why after a bond was executed should the creditor be put to the expense of a trial? He would propose that after a certain number of days the creditor should have the power of having an execution against his debtor. An objection might be made as to those accounts which were running as unliquidated demands and not secured by any instrument; he should propose that the creditor bring his action, and then, after verdict, have instant execution, in like manner as in a 562 bond. He next proposed that the creditor should be enabled to compel the debtor to surrender his property. By the present law a debtor might be taken and imprisoned, but he had the privilege of taking lodgings in the Rules without the prison, where he might live despite of his creditors, and waste his substance which ought to be applicable to the payment of his debts.—And with respect to this there was this strange law, that if the debtor were possessed of property under 300l. he might be compelled to surrender it, but if above that sum, then he could not be made to surrender it; when, indeed, the very circumstance of the large sum rendered it more proper that the larger property should be made applicable to the payment of his debts. He would propose to give a power to the creditor to summon the debtor before a judge, and on cause shown, the debtor to be compelled to assign over a sufficient proportion of his property for the payment of his debts. By the law, as it at present stood, if a man were indebted to the amount of one hundred thousand pounds and became bankrupt, he could not be imprisoned unless fraud were proved against him; but when a man owed only 40s. he could be immured in a gaol and there kept, when the larger debtor escaped with impunity! he did not see why this should continue. His next measure was, that all the property of a debtor, property of every description, should be made subject to the payment of his debts. At present, if a debtor were possessed of ever so much money, it could not be taken by any proceeding. If a debtor possessed 10,000l. in Consols, or in bonds or bills, they being choses in action, could not be taken under an execution. If he possessed land, the creditor could only take one half, and, afterwards, another half of the remaining half, and so on; but he never could at once take the whole. Copyhold land was entirely protected from judgments, and he could see no earthly reason for the distinction. Thus, therefore, though a debtor might be possessed of large copy-hold property, he could, if he thought proper, keep the whole from his creditors. He proposed that all funded property should be made subject to debts. Under the existing law, if a man possessed 10,000l. in the Three per Cents., he might go abroad, there receive his dividends, and leave his creditors unpaid. There was no law to prevent his doing so. 563 It was true, that a Court of Equity would prevent the transfer of property in the funds by a fraudulent creditor, but the might enjoy the full proceeds of his dividends with the most perfect impunity. He, therefore, proposed to make copyhold and funded property, and money, bonds, and bills, all liable to execution. He would make no distinction—he would make them all liable to the payment of debts. While thus looking to the interests of the creditor, he would not overlook those of the debtor. He would propose to allow him to make a cessio bonorum, without being driven within the walls of a prison. Suppose an unfortunate debtor was obliged to take the benefit of the Insolvent Act, though he be freed from arrest and imprisonment, yet all the property that he subsequently acquired was, by the present law, liable to the payment of his debts. He would propose that, if the property of the debtor were not sufficient to pay the whole of his creditors, he might, by a declaration of his insolvency, a surrender of his property, and an equal distribution, be enabled to procure a certificate of entire discharge, and be enabled to commence the world again unshackled by continued claims. Need he say the consequences of imprisonment were of the worst possible description? it was always pernicious to morals—a man never went into prison without being contaminated by the society he found there. The practice was productive also of this bad consequence, that the debtor, in the face of great expenses, was induced to collect monies and property of which he defrauded his creditors, for the purpose of maintaining himself in prison, and paying the expenses of his discharge. The returns made of the average amount of dividend paid upon the estates of all persons passing through the Insolvent Court, showed that those estates did not pay more than one farthing in the pound. And he felt quite sure, that if the debtor were, instead, declared insolvent, and his property promptly and equally distributed, the same debtor who paid under the present insolvent system one farthing in the pound, would pay a respectable dividend; and it might be allowed that, if the creditors were satisfied with the conduct of the debtor, they might give him a memorial or certificate of that satisfaction to enable him again to conduct himself in the world with credibility and success. So much for the 564 debtor when honest in his transactions; but if a debtor should conduct himself fraudulently, then he would act contrariwise; and he thought it ought to be provided, that several things should, as against debtors, be declared misdemeanours, and be punished accordingly. He would have it declared a misdemeanour when a man absconded from his creditors; he would have it made a misdemeanour when a man refused to disclose his property after judgment; he would have it a misdemeanour for a man fraudulently to convey his property, or to dispose of it amongst his friends; he would also have it declared a misdemeanour for a man to contract debts without a reasonable prospect of paying them. When two or three persons acted together in accomplishing some fraud, they could be punished for a conspiracy; but when there was only one person, who, though he might pretend to be in affluent circumstances, and obtain on that ground a large quantity of goods, and dispose of them, yet—however absurd it might appear, and however criminal his conduct—there was no punishment for such injustice. He would propose to make such persons liable to punishment. Although a great change would thus be made in the law, he was of opinion that a considerable majority of the public was against the continuance of the present system. When the subject was discussed in that House, so far back as the year 1780, when Mr. Burke took a part in the discussion, that distinguished individual afterwards expressed his regret that he did not advocate a more extensive change. The learned Commissioners who had sat upon the inquiry on this subject, agreed that a change must be made. What he meant to propose was, that the subject should after the Bill was brought in, be referred to a Committee up stairs, who would be more competent to go into the important details than he could at that moment; and he trusted that his hon. and learned Friend, the Attorney-General would allow his name to be added to those of the other gentlemen, who might sit upon the Committee; and, for his part, he would willingly give the Committee his best attention on the various details which would be there better discussed. He knew the public took a deep interest in the matter—he had received hundreds of letters from all parts—he had received memorials without num- 565 ber, and deputations from different parties, which clearly showed that the public fully felt the importance of the subject. He hoped the House would allow him to introduce the Bill, and, on some early occasion, to read it a second time.
§ The Attorney-Generaltook the earliest opportunity of declaring his approbation of the principle of the Measure of his hon. and learned Friend, to whose labours and talents he would bear a willing testimony. During the last Session of Parliament he had the honour of introducing a Bill which involved the first proposition of his hon. and learned Friend. He regretted that his hon. and learned Friend did not render his assistance in forwarding that Bill, as it would have allowed the public to judge of the operation of the principle then proposed to be carried into effect. He was satisfied that the best mode in these matters was to proceed gradually and carefully, because the commercial world would then rest satisfied that they were proceeding safely. It was not that he ever considered his measure of last session either as final or effectual as a whole, that he proposed it, but that the public might be the better able to judge of the principle by observing the operation and effect of a small part. He would state that, however strong a right society had to be protected in its dealings, yet he was of opinion that no man ought to hold his liberty at the mercy of another; and there might be introduced a clause in the affidavits holding to bail, that might effect this object. It was not fitting, neither was it the general spirit of our laws, that misfortune should be dealt with as a crime. We should not confound one with the other, nor should we allow crime to escape under the guise of misfortune. There was one thing, however, advanced by his hon. and learned Friend from which he dissented. He objected to the increase of our criminal code, which was sufficiently extensive. He was averse to multiplying crimes and offences, but with that exception he was generally in favour of the principle of the Measure then before the House.
Mr. O'Connellregretted that the Bill was not to be extended to Ireland; for it was founded on the clearest principles of justice. Alluding to the monstrous absurdities which existed in the present state of the law, he observed that the time was come to destroy them—not bit by bit, but 566 in a wholesale way. There could not be a clearer principle than that misfortune ought not to be punished as a crime; and it was evident, therefore, that they ought to go the full length of abolishing imprisonment for debt,—always giving a remedy against fraud in the contracting of it. That remedy might be obtained by making the fraudulent debtor liable as for a misdemeanour, in which case he would be tried by a jury. He did not wholly concur with the hon. and learned Member for Edinburgh (Sir J. Campbell) in the propriety of releasing the debtor, who had given up the whole of his property, from any subsequent claims on the part of his creditors; indeed, he might say, that he doubted much whether any good effects had resulted from the system of granting certificates to bankrupts. The man to whom a debt was due ought to be under the protection of the Legislature equally with him from whom it was owing; he should not lose his right of requiring payment from his debtor because that debtor happened to fall into misfortune, but ought to have a claim upon the fruits of his debtor's industry until the debt was paid in full. He, therefore, begged to differ from the hon. and learned Gentleman as to the mode of what was technically called "whitewashing." He knew that cases frequently happened in Ireland where men who were discharged as insolvent debtors, took care to he in the enjoyment of their property after their discharge, in the name of some convenient relation. He repeated his regret that the Measure was not to extend to Ireland, and hoped that in the Committee means might be devised for securing that desirable object.
§ Mr. Richardssaid, that the Measure was one of the most important in its nature and its probable consequences, not alone to the mercantile but the landed interest of the country, which had ever been submitted to the consideration of the House. As a Member of the commercial class he conceived it to be his duty to state to the House and the country the disadvantages likely to result from its adoption, notwithstanding the odium he was certain such a course would entail on him. There were several things in the Bill which had his assent; the twenty-eighth clause for instance, which made landed property amenable for the amount of bond debts. By that clause in the course of a few years 567 all the landed property in the kingdom would be under the jurisdiction of the Court; but of that he, as a mercantile man, could not reasonably complain if it was otherwise legal and constitutional.—The Bill was intitled "A Bill to facilitate the Recovery of Debts." It was true that facilities would be afforded for the recovery of one class of debts; but another of much greater importance would not be touched by it at all. The first clause proposed to give a summary power of entering on execution after the lapse of ten days, on an overdue bond or bill. As a commercial man he did not object to this either. The second clause—
§ Mr. Ewartrose to order. The hon. Member was discussing a measure in detail which was not as yet before the House.
§ The Speakerdecided that the hon. Member was out of order.
§ Mr. Richardswould assume, then, for the purposes of discussion that the Bill was substantially the same as that which had been before the House last Session. That measure gave a summary power of execution on the goods and chattels of the drawer or acceptor of a dishonoured bill of exchange after a period of ten days. Now, what would be the consequence of this clause? There was, it was well known to all commercial men, from two to four hundred millions sterling's worth of bills in circulation in these kingdoms, the majority of which were at two and even one month; but, he would, for the sake of argument, average them at three. This would give a sum of 1,200,000,000l. a year. Each of these bills went through three hands at least, the drawer, the acceptor, and the holder, which number, multiplied into the latter, gave 3,600,000,000l. per annum on the gross circulation.—["Oh, oh!"] He did not understand the nature of the cheer which hon. Members bestowed on it. It seemed rather equivocal, as if they doubted his statement, but he would refer to the lion. Member for Essex in confirmation of the fact, as well as to any other hon. Member acquainted with the commercial community of the empire. The power thus given to the holders of bills of exchange would have the disadvantageous effect of making no man draw a bill who had not ample means to meet it when it became due. If this were the case, how many bills would be drawn? How many of the Gentlemen who came 568 from the sister isle would be able to sell their land, aye, their land even? [Laughter.] He did not mean to inquire invidiously, but he would wish to know of those hon. Members who indulged themselves in a laugh at his expense, how many of their bills would be drawn? But what he desired was to point out the effects this clause would have upon trade and commerce, and even on agriculture, If the number of bills in circulation at present were diminished by one half, as no doubt they would be if the measure had the force of law, the prices of produce of every description would be also reduced in the same ratio. Would hon. Members from the agricultural districts like to see their wheat 3s. a bushel in place of 5s. or 6s., its present amount? or would the manufacturer desire half his profits to be cut off, which would be the natural consequence? The law of arrest was proposed to be done away with unless the debtor had an intention to abscond, in which case the creditor would have the power of arresting him, but with the onus probandi of the debtor's intention lying on him. Such a clause would prevent all arrests, as every creditor would rather allow the fraud than risk an action. Therefore, the power contained in it was wholly nugatory. He was aware that it was not usual to enter on the details of a measure until it was regularly before the House; but his anxiety to disabuse the public induced him to depart from the established custom. It was a measure of false philanthropy, and one which injured the debtor as much as the creditor; because the debtor would not be able to get credit—and the creditor would not have the option of granting it. Though many parts of the Measure were entitled to the serious consideration of the House he thought, as an attempt to alter the present law of debtor and creditor, that, if carried into operation, it would have a most injurious general effect.
§ Mr. Shawthought many of the observations of the hon. Member for Knaresborough entitled to much weight, but he did not think that, as a whole, they militated much against the form, or at all against the principle, of the measure. His object, however, in rising was not to enter on the Question, but to earnestly request of the hon. and learned Member for Edinburgh that he would include Ireland in its provisions. It was most 569 important to the integrity of the empire that the law should be uniform in both kingdoms, and he hoped it would never be said, that a measure of such moment was applied to the exigences of the one country and refused to those of the other.
§ Mr. Warburtonas a mercantile man engaged in business for a period of twenty-five years denied that there was any cause for the alarm which the hon. Member for Knaresborough had endeavoured to excite on the subject of the Bill of the hon. and learned Member for Edinburgh, not alone among the commercial, but among the agricultural classes. During his connexion with trade he never found the least facility for the recovery of debts in the power afforded him by the law of arrest. The surest plan he found to be inquiry into the character and condition of his customers. He could anticipate nothing but good as the result of this measure if carried into execution. Though the hon. Member for Knaresborough appeared to deprecate any reduction in the amount of paper afloat—and he must certainly have known that a great quantity of it was valueless—did he mean to state that a reduction in the amount of bad paper which was just what his argument proved, would be an evil to the community? Did the hon. Member think it no advantage for a creditor to possess a power over the copy-hold property of his debtor, which the Bill proposed to place in his hands? The effect of the measure would be to banish bad bills out of the market; and if it did only that, it was entitled to the support of every hon. Member who held the welfare of the community as a thing worth consideration.
§ Mr. Hawessaid, that no dealer at the time he gave credit contemplated any advantage derivable to him in the way of recovery of his debt from the law of arrest; therefore in as far as it affected that part of the question it was nugatory. The mode of doing business at present adopted in large commercial houses very much increased the circulation of paper, because small sums, which heretofore were considered as book debts were now paid by bills at a short date. Should no facility for separating the good from the bad in the enormous quantity of these necessarily afloat be offered the trader? As a man of business and a trader himself he felt bound to bear the fullest testimony to the advantages offered the trading community by 570 the principle of the Bill of the hon. and learned member for Edinburgh.
§ Mr. Peasedid not think the amount of human misery, either among the artisans, the tradesmen, or the farmers, would be much reduced by this measure, and he deduced his reasons from an inspection of the operation of the Courts of Requests upon these classes of the community. Notwithstanding, the Insolvent Debtors' Court was so odious that he should willingly support any measure which would have the effect of getting rid of it for ever. He could not, however, shut his eyes to the probable consequences of some parts of the measure.
§ Mr. Rolfesupported the Bill. Though the hon. Member for Knaresborough had paraded his information and put himself forward as a mercantile authority against the Bill, he (Mr. Rolfe) could tell him it was founded upon information as full and as practical in its character as any which he possessed. It was founded on the Report of the Commissioners, before whom were examined hundreds of tradesmen and persons deeply interested in the question. The result of their testimony was the measure in the shape in which his hon. and learned Friend the Member for Edinburgh proposed to introduce it to the notice of the House.
§ Leave given and the Bill was brought in and read a first time.