SECOND READING.

HC Deb 23 June 1858 vol 151 cc225-45

Order for Second Reading read.

VISCOUNT GODERICH

, in moving the second reading of this Bill said, he would state a few reasons to show it was a Bill the principle of which, at all events, ought to receive the sanction of the House. The object was a very simple one: it was merely that any person who entered into partnership or traded under any other name than his own or under the mysterious designation—and Co., should be required to make known the fact to the world by entering the names in a register which would be open to every person wishing to consult it. The principle of the Bill had received the assent of a large portion of the commercial community. He was sure no one would deny that all parties in trade should have the greatest facilities for knowing who were the parties with whom they had to deal. In the case of joint-stock companies the law already required that this information should be given. He only proposed to apply the same principle to partnerships consisting of a smaller number of persons. If this information was not given, facilities would, in many instances, be afforded to fraud. for at present the public were entirely unable to know who were the component members of a firm, or in how many different undertakings a mercantile man might have a share. A business concern might bear the name of an old and honoured firm, from which all the original partners had long since withdrawn, and their places taken by persons of very different position, who would thus obtain credit which they could never get in their individual capacity. Again, a person trading under the name—and Co., would induce people to think he was supported by the capital and influence of others. It had been said people could always obtain the requisite information for themselves. But in many cases it was impossible to obtain that information, and in several instances serious loss had resulted from the want of it. Of the cases laid before him he would state two which had recently occurred, and which wore brought to light during the commercial crisis of last winter. It was the duty of the House to prevent frauds such as he had to state, which reflected disgrace on the whole commercial community. The first case was a notorious one; it showed how easily a man trading under the name of a company could obtain credit in various branches of business, and at length leave his creditors in the lurch for an amount which he would never have got if the real facts of the partnership were known. The case to which he referred was that of Mr. Stephens, the manager of the Eastern Banking Corporation. From the statement of the case, as it appeared in the papers, Mr. Stephens would seem not to have been a mere manager of a bank—his real capacity was rather that of "Co." by profession; in 1855 he was a "Co." three times, in conjunction with a clerk of the bank; he was Barwise and Co. He and Colonel Waugh were the Branksea Clay Company. He was constantly starting new firms. If they made any money, as sometimes happened at first, he pocketed it; but if there was a loss, it came out of the funds of the bank. Such schemes would have been impossible if there had been a registration of partnership. That was a case of gross fraud, which they should take steps by, Legislation if possible to prevent. The next case was a striking one—it was that of a person holding a high position in Dundee; a firm there suspended payment, and it then turned out he had been a partner in it for many years, and had dealt largely in accommodation bills—in fact, that was the sole business in the partner- ships. He was, of course, far from saying that all persons trading under other names than their own did so with the intention of fraud, but he contended unless the public had means of knowing who these people were, facilities were given to fraud which the House ought to prevent. Another argument for registration was the difficulty thrown in the way of legal proceedings by the want of some such system; in an action against a partnership the plaintiff was liable to be met by a plea of abatement, unless he stated the names of all the partners. Parties were thus put to great expense, and very often in spite of the expenditure, defeated in their claims. He had received from a solicitor of the highest standing in Manchester the statement of a case of great hardship arising from the want of registration. He believed the Bill he proposed would meet all the evils complained of, and it had the approval of very high authorities. In bringing it forward he had not acted merely on his own opinion, but with the sanction of the highest commercial authority; it was approved of by all the Chambers of Commerce of the West Riding of Yorkshire. The history of it was this: In 1856, the Manchester Commercial Association took up the subject, and drew up the heads of a Bill. This draft was submitted to the Mercantile Law Conference held in London in 1857, under the Presidency of Lord Brougham, and a resolution in favour of registration of partnerships was adopted at the conference. The Bill was also approved of at the meeting of the Association for the Advancement of Social Science, held at Birmingham last year. He had taken up the Bill at the request of the Chamber of Commerce of the West Riding. The Chambers of Commerce of Liverpool and Bristol had petitioned in favour of it. A number of other petitions to the same effect had been presented, and only one against it, and two petitions from Scotland had been presented, praying the Bill might be extended to that country. It was stated that the Bill was opposed by several parties in the city of Manchester. He did not deny their opinion was entitled to every respect, but the Commercial Association of Manchester had petitioned in favour of the Bill, and at a meeting of the Chamber of Commerce a resolution proposing a petition to the same effect was only lost by the casting vote of the Chairman. It was stated the Bill was unnecessary, as the information could be easily obtained; if that was so, why object to make it public? Another objection was, that the Bill was inquisitorial; but that epithet was entirely inapplicable. It gave no powers to any persons to make inquiries into private arrangements. It only required that the partners should themselves state their names. It was also objected that the Bill would be vexatious. Bankers were compelled to register the names of their partners, and he would appeal to the hon. Member for Kendal (Mr. Glyn) to say whether he had ever experienced such a registration to be vexatious. He should he the last person to attempt to force the Bill on an unwilling commercial community, but he could not consent to withdraw it on the assertion that the commercial community were opposed to it, so long as he knew that it was approved of by the commercial community of the West Riding and of other places. He did not desire to lay any restrictions on the formation of partnerships, his object being to allow any one to enter into a partnership provided he made it known to the public. He simply asked for publicity, and with publicity he was quite willing that persons should enter into any kind of partnership they pleased. The machinery of the Bill had been approved of by the Associations he had mentioned, but of course he would be ready to consider any suggestion made for its amendment.

Motion made and Question proposed, "That the Bill be now read a second time."

MR. COLLIER

said, he had no doubt the object of his noble Friend was to benefit the commercial classes, but he would, he believed, be able to show, if not to his noble Friend, at least to the House, that it would have a directly contrary effect. The Bill was a retrograde step in legislation. The principle on which Parliament had acted of late years in these matters was non-interference—to allow commercial men to look after their own interests, of which they must be better judges than any department of the State. Registration was demanded from joint-stock companies and bankers in return for the exceptional privileges which were conferred on such associations, but there was no reason why private firms should be called on to furnish this information. The Bill would apply to every joint undertaking, however small in its object, and however temporary in its nature. If two merchants, not connected in business in any other way, joined together in a single speculation they would have to register their partnership, and register its dissolution. Nay, it would be impossible for two gentlemen to make a joint book on the Derby without going through the ceremony of registration. The pressure, however, of the Bill would be chiefly on the poorer classes; all the hucksters and greengrocers in the country would have to register their joint undertakings. If two fishwomen in Billingsgate Market joined together in a boat-load of fish, they must register their names and addresses at an expense of 5s. Until they did so they could not recover the price of any fish sold, and next day they would have to pay 2s. 6d. for the dissolution of the partnership. How could his noble Friend distintinguish between great and small traders—between the Barings, for instance, and a partnership of costermongers? His noble Friend did not seem to be aware of the scope of this Bill. A person lending money with a participation in profits would be obliged to register; he would be obliged to notify his retirement, and he would be obliged to register again if he lent a second sum of money. His noble Friend did not seem to be aware of the difficulty of determining what partnership was. There was no question so difficult to define as where partnership began and ended, Lord Eldon himself never could absolutely make up his mind what a partner was. Lord Eldon said:— The cases have gone to this nicety, upon a distinction so thin that I cannot state it as established, upon due consideration, that if a trader agrees to pay another person for his labour in the concern, a sum of money, even in proportion to the profits equal to a certain share, that will not make him a partner; but if he has a specific interests in the profits, as profits, he is a partner. Again,— It is clearly settled, that if a man stipulates as a reward of his, labour he shall have, not a specific interest in the business, but a given sum of money, even in proportion to a given quantum of the profits, that will not make him a partner; but if he agrees for a part of the profits as such, giving him a right to an account, though he have no property in the capital, he is as to third persons, a partner. The noble Lord's Bill therefore would open a wide stream of litigation most nourishing to the lawyers, but at the expense of the general public. The noble Lord said the Bill was not inquisitorial, but it must be inquisitorial to be carried into effect. Section twenty-one gave power to the registrars, on application of any persons, to call upon any person supposed to belong to an unregistered partnership to give full information on the subject under a penalty of £10. Such a provision as this might be made the means of endless vexation and annoyance. Then, again, it was provided that if a partnership were not registered it could not sue, and of course this plea of non-registration would be the favourite defence of all dishonest debtors who didn't want to pay their debts. The Bill, therefore, would not simplify but complicate the present state of the law. According to a petition he had presented it was calculated that the first expense of registering partnerships in Manchester alone under this Bill would amount to £1,100, and this would show what a burden would be cast on the trading classes throughout the country. His noble Friend, if he wished the House to assent to his proposal, should have shown that it would remove some serious grievance, or that the trading community generally were anxious for its adoption; but no evidence had been adduced to establish either of those positions. Men of capital were at present in the habit of lending their money to industrious young traders possessed of little money, on the condition that they should share in the profits of the undertaking which they thus helped to establish. That was a very desirable state of things, and one which ought for the general interests of commerce to be encouraged; but it would necessarily receive a great check from the passing of that measure, because those capitalists would in numerous cases decline to engage in any transaction which would necessitate the registration of their names as partners. He denied that any serious evil prevailed under the existing system such as would render it desirable that a measure of this kind should be enacted. What possible interest could it be to any one to know who were the sleeping partners in a concern? The dealings were generally with the ostensible partners; and, even if anybody should be so curious, the best mode of getting the information would be to go and ask, without having a State machinery set up for the purpose. If the information were not satisfactory, there still remained the alternative of not giving credit; but until an Act of Parliament was passed compelling merchants to give credit, such a Bill as this was entirely useless. The only true basis of credit was the knowledge of the character, habits, and capacities of the persons with whom dealings were carried on. A prudent man did not trust the abstraction "Co.," but the concrete "Jones," whom he saw and talked to. No doubt in some cases business was carried on under a certain designation when all, the original members of the firm had retired from it; but what difference did that make to the public? How could it interest the public to know whether the original "Warren" still sold the famous blacking? or what harm would be done if, when the hon. Member for Derby (Mr. Bass) was matter of history, somebody of a different name should dispense to thirsty generations yet unborn the excellent article known as "Bass's Bitter Ale? "As to frauds, the Bill, instead of preventing them, must inevitably increase them. What was to prevent dishonest traders or speculators—the Montagu Tiggs—from registering Baring or Rothschild as their partners? Such a proceeding would serve the purpose of gaining them credit for a little while, and by the time the fraud was discovered they would have levanted. No great practical inconvenience was experienced under the present system; and as to the difficulty which it threw in the way of legal proceedings, it was well known that the plea of wrong description of partners referred to by the noble Lord was seldom advanced by defendants, because they were obliged to state in it the names and addresses of all their partners, and thus to furnish this very information. He thought, therefore, that the evils which existed were not sufficiently great to justify this measure; and more than that, the Bill would not cure them if they did exist. It would be perfectly impossible to keep up this register; at the best it must necessarily be very imperfect and incorrect, and would rather mislead than inform. The Bill was evidently inspired by the registrars. These gentlemen had a regular organization throughout the country, they kept up a continual agitation of register! register! and would apparently never be contented until they had registered everybody and everything. They were the motive power, and it was to their influence with some portions of the mercantile community that the Bill owed its origin. It was true that some of the Chambers of Commerce had petitioned in favour of the Bill, but these chambers very often contained gentlemen who were more theorists than practical men—and they could not claim to represent exclusively the great body of the trading community. Certainly, if the poorer classes of traders and shopkeepers knew what was in store for them, they would rise and petition en masse against the Bill. The Bill would substitute State protection for individual vigilance. It would be inquisitorial in its character, expensive in its operation, give rise to litigation, whilst it would not prevent fraud; and under these circumstances he should move that the Bill be read a second time that day six months.

Amendment proposed to leave out the word "now," and at the end of the Question to add the words "upon this day three months."

Question proposed "That the word 'now' stand part of the Question."

MR. MOFFATT

seconded the Motion. The mercantile classes were suffering from the law of contracts, the law of debt, and the law of partnership. With regard to the last they did not know what a partnership was, and if his noble Friend brought in a Bill to define what partnership was, he would do a great deal of good; but, as it stood, the Bill was one of pains and penalties upon commercial partnerships, the formation of which on the other hand ought to be encouraged by the Legislature. The Bill contained clauses requiring persons to sign when they retired; but what was to be done if a partner was expelled and refused to sign? No one except those who were practically acquainted with business could say how much mischief would be done by this Bill. He believed it would stop one-fourth of the commercial speculations of the country. He did not think that any serious disadvantage arose from the existing state of the law upon that subject, and he could without any hesitation say that in the conduct of his own commercial business he had never experienced any difficulty in finding out who were the real partners in any firm with which he had to engage in any dealings without the aid of the objectionable process suggested by the noble Lord. Very frequently a person of wealth was the partner of a merchant or a tradesman merely in one transaction, and very great injustice would be inflicted upon creditors by the registration of such person as a partner as it would be presumed that he was a partner in every transaction of the merchant or tradesman, The Bill would merely lay a snare for creditors, and he therefore cordially supported the Amendment.

MR. BAXTER

said, the speech of the hon. and learned Member for Plymouth (Mr. Collier) had not convinced him that the House ought not to assent to the second reading of the Bill, He had been urged by many of his mercantile friends carrying on business in various parts of the country to introduce such a measure as this; and he had, in fact, prepared one and would have introduced it, had he not been anticipated by the noble Lord. The hon. and learned Member for Plymouth had stated no reasons for his assertion that the Bill would deter capitalists from advancing money to young men to carry on trade. The hon. and learned Gentleman had spoken of the facility with which in most instances the names of the partners in a firm could be obtained, but he could not deny that in some instances it was impossible to obtain them. It was said that the names of the partners in a single adventure would have to be registered under this Bill, but the interpretation clause showed that it provided nothing of the kind. It simply provided that the names of persons who carried on business as a firm should be registered. It was also said that the Bill would impose a tax upon the poor class of tradesmen,—such as greengrocers and hucksters. Well, there had been recently many remarkable instances of fraud committed by those people, and a measure of the sort was as necessary with regard to them as to the largest traders in the land. The hon. and learned Member for Plymouth had cautioned the House against passing the Bill, because it was difficult to define who was a partner. But the Bill did not attempt to define who was and who was not a partner; it simply provided that such persons as were partners in the present acceptation of the term should be registered. The Bill had been denounced as inquisitorial, but he (Mr. Baxter) could not conceive why any honest firm should be afraid of the names of the partners being made known to all the world. The Bill would put a check upon dishonest firms who were carrying on business on false pretences. The tax which it would impose upon the commercial community would be infinitesimally small, and could not be for a moment weighed against the advantages of the measure. Most of the objections which had been urged against the Bill were merely against its details, and could be better considered and if need be remedied in Committee. In no other commercial country that he knew of was there the practice which prevailed in this country of retaining the original designation and title of a firm when the old and monied partners had retired, The mercantile crisis a 1857 proved that that practice prevailed in this country to an astounding and ruinous extent, and that it enabled young men who had no capital to carry on vast commercial transactions. Most effectual measures had been taken in the United States to prevent the public from being imposed upon by such men. In that country the title and designation of every firm had to represent faithfully every individual member of the firm, and every change in the partnership had to be advertised in the newspapers. Over the door of every firm were the names of each partner and the title of the firm. The noble Lord did not ask the House to introduce that system into this country, but he (Mr. Baxter) believed that the Americans were acting on a right principle. He believed that the Bill was called for by the great majority of the commercial men, and he would earnestly aid the noble Lord's endeavour to pass it into a law.

MR. WARREN

said, that he regretted being unable to give his support to the Bill of his noble Friend the Member for the West Riding, because the more he considered the matter the more objectionable the Bill appeared, as founded on an erroneous and mischievous principle. In the first place, it had not been called for by the mercantile public, who consisted of a class of persons remarkably shrewd and awake to their own interests, and whatever might serve to promote them. He had always considered that there was this signal characteristic of the law merchant of England, that it stood less in need than any other branch of our jurisprudence of legislative interference. The Legislature wisely considered that commercial men were obviously the best judges of their own interests, and it had been content to look on and see them shaping their usages into system according as each successive exigency developed the necessity for altering them. If those whose vital interests required an obvious change did not call for it, what was that but cogent evidence of its inexpediency, in the estimation of those best qualified to determine? It was true that one great department of mercantile jurisprudence, involving most difficult considerations, and which had called forth so much refined and subtle judicial reasoning on the part of Lord Eldon, and indeed the greatest practical jurists of modern times—he meant the law of partnership, had of late years attracted a great deal of attention from the Legisla- ture, and experienced frequent interference. That, however, was because of the novel requirements arising out of those huge partnerships which had now overspread the country, called joint-stock companies; but would any practical man, whether lawyer or merchant, say that the result had been satisfactory and creditable to the Legislature? Was the law of joint-stock companies at that moment on so very satisfactory a footing? If so, why was Parliament called on year after year to alter and amend its own handy-work? And if it had done this in respect of these public partnerships, it was also interfering at last with the law of private partnerships—and here was an attempt, by the uncalled-for Bill before the House, to go infinitely further in the path of interference with the business of traders and merchants than it had hitherto gone, and subject them to a sort of excruciating exposure of private affairs and private resources which would have the most serious effect on commercial credit. His great practical objection to the Bill, on principle, was the strongest that could possibly be urged against a commercial measure—it would drive money out of trade, injuring, to an extent not at present forseen, most especially the shopkeepers of the country. Let the House look at this matter in a business-like way, for it touched the interests of nine-tenths of their constituents. The great proportion of the capital of traders, in London and elsewhere, was not their own, but furnished to them by persons who were not otherwise connected with trade— gentlemen, nay, ladies as well as gentlemen, and often of high station, who were, in doing so, influenced by a double wish—to increase their own income, and at the same time, from kindly motives, assist a particular tradesman in whom they felt interest. There were two ways of doing this. First, if they felt confidence in the character and business abilities of the trader, they shared his profits, in agreed proportions; and thus, the House would observe, constituted themselves either the open or sleeping partners of such trader. But secondly, if they did not choose to encounter the risk of partnership, what did they do? Why, they formed the best estimate they could of the probable profits of the business, and then stipulated that they should receive, in lieu of any portion of such profits, a fixed equivalent rate of interest, making in that case, the advance by way of loan. They did that by means of a bond or a bill, which was made payable, let the House observe, before the trader could touch one farthing of the profits of his own trade; and could anything be more disheartening to him, and directly calculated to paralyze his energies? This latter method then was one heavily unfavourable to the borrower. And, in a word, any measure calculated to expel the capitalist, or turn him into a hard exacting money-lender, would be destructive to the trader. But this was really the direct effect of the Bill before the House. Gentlemen and ladies—all persons not already known to be connected with trade—would, if this Bill became law, break off all connection with trade. They would have a very intelligible repugnance to its being proclaimed to the world that they had become, as partners and consequently traders, liable to be made bankrupts. Many would think their dignity compromised, if known to be deriving profit directly from trade. But, beyond all this, they would have heavy misgivings as to the effect of the publicity effected by the new law, on the trader himself. For so long as he was supposed by others to be trading on his own capital only, he could not get credit beyond a limited and safe amount; but the moment he was known to be in partnership with a wealthy private gentleman, this sort of natural check on improvidence would disappear; he would succumb to incessant temptations to speculate, and to the importunities of the wholesale houses with whom he dealt. All this would be foreseen and dreaded by the friendly-disposed capitalist, and he would hold off his hand. What could be said in favour of a Bill with such a blot as this? Nothing that could bear the test of argument. Suppose he (Mr. Warren) put £2,000 into a publisher's business, and shared his profits, and by and by the publisher failed. He (Mr. Warren) might have done the trader's creditors much good; but how could he have done them harm? They either would or would not find out that he (Mr. Warren) was a partner. In the former case, he was liable to pay all his partner's debt, and so the creditors escaped all loss. In the latter case, they would be in no worse position than if the £2,000 had been, as they had supposed, the trader's own, and not his (Mr. Warren's). But then it would be said that the lender might collude with a trader, and withdraw his capital just before the trader's failure, at the cost of the other creditors, That, however, was not a probable event; because the withdrawal—especially the sudden withdrawal—of capital would attract attention, and provoke inquiry; and what would be the result but the discovery who had been the partner, and who, consequently, was liable for all the debts? It would, therefore, be the lender's interest to abandon his capital, to escape the discovery of his having been connected with the trader in business; and it would not be for the trader's interest to give his secret partner an unfair preference, as his character would suffer. If there were really anything solid in these objections, then, the Bill before the House would drive capitalists always to make advances to small traders, if at all, by loans at high interest, on short renewable Bills, enforced on the lender's getting the first glimpse of danger; and the direct result would be that the legitimate trade creditors would find all the assets suddenly swept away and beyond their reach. How could a Bill leading to such mischievous results as these be one worthy of being entertained by the Legislature? Having offered these objections to the principle of the Bill, he was content not then to offer any to the objectionable machinery by which the Bill sought to obtain its object.

MR. BAINES

said, lie should support the Bill because he had no doubt as to the excellence of its principle, to which the greater part of the objections of the hon. and learned Member for Plymouth did not apply, but merely to its details. The Birmingham and the Liverpool Chambers of Commerce had petitioned the House, not against its principle, but for an alteration of its details. The chief question to which a commercial firm about to do business with another desired an answer was, "With whom are we about to deal?" To that inquiry, as the law at present stood, persons in trade were not able to obtain a satisfactory reply—a want that would be supplied by the operation of the Bill. In his opinion one of the effects—and indeed, a leading effect of the proposed Bill—would be to check fictitious trading, by compelling all persons in trade to register their names and residences just as in the case of joint stock banks and companies. It had not been suggested in the debate that any particular inconvenience or injustice had accrued from the adoption of this system; and it was especially in order to give to the poor, small, and struggling trader a perfect knowledge of those with whom he was about to enter into a contract, and which he had not the means of ascertaining from the Stock Exchange or other sources, that the Bill now before the House was proposed. The law had already stepped in advantageously to furnish this species of information in other cases. In the case of cognovits, warrants of attorney, and bills of sale, the principle of registration in order to give the public information was strictly recognised. Another important object that would be effected by this Bill would be the prevention of chicanery and litigation. Now, it was said that the plea in abatement already enabled parties to obtain a disclosure as to who were partners, and as to who was the proper party to be sued; but sometimes, after great inconvenience and cost, the right party was not discovered; and if the law thus imperfectly furnished the facility, by all means let it do as was now proposed fully and unmistakeably in the first instance. The House was asked to adopt a measure which would give to the entire community of traders the means of ascertaining that which, by proceeding under the plea of abatement, the law of this country held it was not improper but legitimate to obtain. With regard to the authority on which the Bill was brought forward, he could testify to the fact of the existence of a unanimous feeling in its favour in Leeds and the West Riding, and other large commercial communities. He had not received a single communication in deprecation of it, and he believed that traders throughout the country, though they might differ as to the details, were anxious to have the principle of the Bill passed into a law.

MR. WEGUELIN

said, that the principle of the Bill was exactly the opposite of that which, he conceived, should govern all transactions of commercial credit, and that it was an undertaking on the part of the State to do that which individuals alone could satisfactorily perform. In point of fact, in a measure of this kind details could not be separated from the principle of the Bill, and the details were most objectionable. It had been denied that the effect of the Bill would be, that parties could not enter into any transaction or joint account with any other firm or house without registering it as a partnership; but the 4th clause showed that this was really the case, so that if one firm entered into transactions with another on the other side of the street it would by this Bill have to be registered. It was said that the present system of business was carried on very often under false pretences. Now, he distinctly denied that. The principle on which any person gave credit to a firm was, that they well knew the persons of whom it consisted, and trusted them accordingly. No credit was given to unknown partners, though if there were any, their capital certainly was no disadvantage to the firm of which they were members. Indeed, what the public really wanted to know was, not those who joined the firm so much as those who went out of it, and took their capital with them; and there already existed under the head of dissolution of partnerships in the Gazette every information on that subject. But one of the difficulties of the proposed registration of partnerships was that persons might have foisted upon them a partner they never knew. A leading clerk might take upon himself to register himself as a partner of a firm, and obtain credit on the strength of it, and this evil would be inseparable from the measure. He was one of those who thought that the registration of joint-stock banks and companies had been carried to too great a length; and he believed that if the partners of many of them had never been registered, they never would have got credit. With regard to the argument drawn from the registration of the members of banking partnerships, they were called upon to register on account of the restriction as to numbers, and not at all upon the principle of the present Bill, and even in the case of banks registration had been carried too far. So, with respect to what had been said in reference to cognovits and warrants of attorney, the principle of registering them was not analogous to the principle of the Bill, for, in point of fact, that registration bore a much closer resemblance to advertising the dissolution of partnership in the Gazette. He had great respect for the bodies calling themselves Chambers of Commerce. They came to conclusions that were sometimes correct and sometimes incorrect; but in some way or other they always wanted to embody their theories in a Bill to be brought before Parliament. He thought that if the Bill were passed there would be a material change in the commercial feeling of the public when it was carried into practice, and that it would prove to be one of the greatest interference with the liberty of commercial transactions that had of late years been proposed. We were continually going too far as regarded registration, and whether we were born, died, got married, or grew a turnip, we must register—register. The class of commercial men most likely to be in favour of this Bill would be bankers, since from the nature of their business they would be anxious to be in a position to form a judgment as to the solvency of the firms attached to bills of exchange; but the general commercial public, in his opinion, would know sufficiently well how to protect themselves. The proposition altogether was a backward step in legislation, and an endeavour to substitute the care of the State for that in which the vigilance of the people should alone be looked for.

MR. SPOONER

observed, that the last speaker had drawn off the attention of the House to the mere details of the Bill, whereas the real question was, should the House recognise the principle that persons who gave commercial credit should have full means of ascertaining to whom they gave it? He concurred altogether in the opinions expressed by the learned Member for Leeds, and he believed that the Chamber of Commerce of Birmingham had arrived at the unanimous opinion that the principle of the measure was to be maintained, though the details of the machinery were open to correction. He (Mr. Spooner) should vote for its second reading, but hoped that the noble Lord who had introduced the Bill would not press it forward during the present Session, or call on the House to go into Committee in the present disagreeable condition of the river. They might remain for weeks before obtaining any real practical information.

MR. CARDWELL

conceived that the Bill had been proposed on two grounds, one of which appeared to him not to rest on sound or reasonable arguments. It had been said that this was a Bill proposing to do by means of State machinery that which was the duty and the business of private individuals to accomplish for themselves. That was a most captivating argument, and if truly stated it ought to be conclusive; but he did not see in the Bill any proposal that at all interfered with commercial liberty, or restrained the freedom of commercial contracts. On the contrary, the pitfalls and difficulties that prevented people from exercising their volition and freewill with those with whom they dealt, in making contracts, were well known to every lawyer and man of commerce in this country. Now, the principle of the Bill was to remove these difficulties. In one word, publicity was the principle of the Bill, and not secrecy, which was no part of free trade, and no ornament or element of British commerce. Why should not the principle of registration be equally applicable to a small as to a large number of persons engaged in commerce? At present certain persons were compelled to register, and that must be on grounds of practical expediency. Objections had been made to the details of the Bill, and it had been said that it would fetter private transactions. Now, the Bill was drawn to include all those smaller transactions to which the hon. Member for Plymouth alluded. What the Bill principally aimed at was, that men of straw should not have the power or opportunity of carrying on business with the capital of other and more wealthy people, or under fictitious circumstances. If they could extend to partnerships the laws of sucing and being sued which applied to corporations, they would get rid of many technical difficulties. An important point to be considered was, whether the commercial community itself was not prepared to accept this Bill and adopt its provisions. He thought they ought not summarily to dispose of a Bill backed by such important commercial communities as the West Riding, Leeds and Liverpool; and on the other hand, they ought not to take it for granted that they and others had fully made up their mind upon the matter. It would be a wise course to give time to ascertain, as had been suggested, the well-informed opinion of those commercial communities on the matter. A Committee would be able to consider what fetters, impediments, or grievances the commercial world were subjected to, and whether the provisions of the Bill were the wisest and most judicious that could be adopted as a remedial means. He, therefore, hoped that the details of the Bill would be submitted to a Select Committee; but he concurred in the opinion of the hon. Member for North Warwickshire, that at that period of the Session it would be undesirable to commence the inquiry. He thought that the noble Lord would be acting in accordance with prudence if he withdrew the Bill for the present.

MR. HENLEY

said, having listened with great attention to what fell from the noble Lord (Viscount Goderich), and also to what fell from his right hon. Friend opposite (Mr. Baines), he did not think the House would be justified in at once making the important change which was now proposed in the law of partnership. Neither on the other hand could he ask the House to negative the Bill. What was wanted in this case was information, and this could only be obtained through the medium of an inquiry by a Select Committee. The first point which his noble Friend insisted upon was, that if registration were provided for persons who were engaged in a variety of undertakings, they would not be able to obtain credit. This raised the difficult question of the difference between a joint undertaking and a partnership; and he appealed to his right hon. Friend the Member for Oxford whether a man who was engaged in trade was very likely to come to a sound conclusion on that subject. Under this Bill, Tom Smith, who carried on business in Broad Street, might have a notion that because he was engaged with others in other transactions he was a partner with them, and accordingly he might pay the registrar 5s. to register him. If the registrar were afterwards summoned to declare who were this man's partners, the question would immediately arise whether the fifty undertakings in which he was engaged were partnerships or joint undertakings. His right hon. Friend (Mr. Cardwell) said there ought to be publicity in order that men might know with whom they contracted. The creditors could only contract with those whom they knew; and if they contracted with men of straw, where would be the justice of afterwards bringing in persons whom they did not know? What security would be afforded by the machinery of this Bill? His noble Friend said, A B was trusted at present under the impression that he was simply a respectable baker, whereas in fact he was a tinker and a shoemaker as well. Well, but how would registration help any one? How would registration enable any one to ascertain the identity of A B the baker with A B the tinker and the shoemaker? His noble Friend had mentioned one case as an illustration, which to his mind most strongly showed the difficulty of the subject. He stated the case of a gentleman who, having carried on business very successfully, died leaving a large property, and upon his death a dispute arose as to whether persons calling themselves partners could take a share in his fortune, it having been previously disposed of. Now, these were persons whom the gentleman to whom he had referred would never have dreamt of looking upon as partners, and certainly would never have registered them as such, so that in a case of that kind the present Bill would be wholly inoperative. It had been said that the mercantile community of Leeds would take the Bill as it stood, but that they would not pledge themselves to details; but did not that rather go to prove that they had not fully or sufficiently considered the subject? There was a very curious provision in the Bill to the effect that anybody who said he was a partner might go and register himself as such, there being no security for the truth of his statement except his own declaration. The result of that would be that A B, a wealthy man, would unexpectedly find that he had been made liable for the debts of C, a poor man, of whom he knew nothing. He knew this was a matter of detail, but in dealing with a measure of this kind they must consider how it could be carried out with safety and advantage to the country. He hoped the noble Lord would assent to the suggestion of the hon. Member for North Warwickshire (Mr. Spooner), and not ask the House to pledge itself then either for or against the Bill. It was not a question that pressed in a great degree; but it was a matter of great importance alike to the large and small tradesman, from the highest to the lowest, that they should proceed upon safe grounds and establish a good measure; and if, on the other hand, they affirmed the principle of the Bill without looking more closely into it, they might possibly take a false step. He (the hon. Member) did not wish to pledge himself either for or against the Bill. What they wanted was information; and he thought, if the noble Lord assented to the course proposed, it would give satisfaction to the trading community at large.

MR. J. H. GURNEY

said, he hoped the House would not deal rashly with so important a subject. The first point to consider was the evil complained of, and the second as to how it should be remedied. No doubt it would be a convenience to creditors to be able to ascertain every circumstance connected with the property, position, and liabilities of their debtors; but it was a convenience which it was not in the province of the Legislature to afford them. It seemed to him that the cases which legitimately came within the reach of legislation were two—one, where firms retained the name of a deceased or retired partner; and the other, where they added to their style the words "and Co." without any partner to represent the Co. He admitted that it was a question whether this practice was sound in principle, although he did not think that the practical evils arising from it were great, and although it had long been followed by many firms of the highest standing and respectability. It was proposed by this Bill to remedy the evil complained of by the general registration of partnerships. But while the number of firms carrying on business in the way he had described was not large, the general mass of firms would thus be subjected to the annoyance of registration in order to guard against the results of the practice of a small proportion. He would much rather see an Act of Parliament passed to prohibit the course or manner of trading to which he had alluded. He could not assent to the second reading, even with a view to the reference of the Bill to a Select Committee; for by permitting it to pass the first stage they would affirm the principle of registration, and the labours of a Select Committee would be limited to the consideration of the mode in which that principle should be applied. It would be far better to withdraw the Bill, and refer the whole subject to a Select Committee next Session.

MR. HORSFALL

said, he would appeal to the noble Lord to adopt the suggestion made to him, and not to press the second reading of this measure. He was himself prepared to affirm the principle of the Bill, but could not accept its details without amendment. He denied that the Chambers of Commerce, in approving this Bill, had acted under the influence of the registrars; in fact, he knew that several of them had objected to many of its provisions.

COLONEL WILSON PATTEN

said, that as his name was on the back of the Bill he should give its principle his best support; but after the discussion which had taken place, although it was clear that the opinion of the House was generally favourable to the principle, yet it was also clear that great objections were entertained to the details, and that there was little chance of making any progress with it at this late period of the Session. He therefore hoped that the noble Lord would not now press the second reading. It was only after the noble Lord and he (Colonel Patten) had ascertained that, as far as they could judge the feelings of their constituents were in favour of the principle of the Bill, that they had undertaken its charge.

VISCOUNT GODERICH

said, he had been much gratified by the tone of the debate. He thought that the principle of the Bill had been favourably received by the House. He had early in the afternoon resolved to accede to the suggestion that the measure should be referred to a Select Committee, for he quite admitted that previous to legislation on this subject it should be fully considered and discussed, and that every opportunity should be given for ascertaining the opinion of the commercial community upon it. He admitted, however, that, at this late period of the Session, and taking into consideration the state of things outside of the House, it would be vain to attempt now to conduct a satisfactory inquiry by a Select Committee on the subject. And if, therefore, he understood that no opposition would be made to the appointment of a Select Committee to inquire into the whole question next year, he would now withdraw the Bill.

MR. HENLEY

said, the noble Lord had correctly understood him to say that he would give him every assistance in obtaining a Select Committee on this question next year.

Amendment and Motion by leave withdrawn.

Order for Second Reading discharged.

Bill withdrawn.