Commons Sitting of 15 July 1863

MINUTES.
SELECT COMMITTEE—Report—Kitchen and Refreshment Rooms (House of Commons) Fourth Report [No. 448].
PUBLIC BILLS—Second Reading—Jurisdiction of Justices (Lords) * [Bill 232]; Pauper Lunatic Asylums * [Bill 234]; Expiring Laws Continuance * [Bill 238]; Land Tax Commissioners' Names * [Bill 239].
Committee—Partnership Law Amendment [Bill 172], on re-committal; Anchors and Chain Cables [Bill 95]—R.P.
Report—Partnership Law Amendment [Bill 242].

KITCHEN AND REFRESHMENT ROOMS (HOUSE OF COMMONS) COMMITTEE.

  RESOLUTION. ADJOURNED DEBATE
  Order read, for resuming Adjourned Debate on Question [2nd July],
  "That, in the opinion of this House, the enlargement of the Dining Rooms proposed by the Committee on the Kitchen and Refreshment Rooms (House of Commons) should be carried into execution."—(Colonel French.)
  Question again proposed.
  Debate resumed.
  SIR DE LACY EVANSsaid, as the hon. and gallant Member for Roscommon (Colonel French) was unavoidably absent on assize business in Ireland, he wished to known whether it was competent for him (Sir De Lacy Evans), concurring as he did in the Motion of his hon. Friend, to move that the debate be resumed.
  MR. SPEAKERsaid, it was competent for any hon. Member to proceed with the adjourned debate.
  SIR DE LACY EVANSsaid, he had but a few remarks to make on the subject. He quite agreed with the observations which had fallen from the right hon. Baronet the Member for Droitwich (Sir J. Pakington) on a former evening. A great
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  number of Members on both sides of the House, in attending to their Parliamentary duties, were in the habit of dining once or twice a week in a room which was obviously too small. He trusted, therefore, that the enlargement of the dining-rooms, as recommended by the Select Committee, would be carried into effect.
  LORD HOTHAMsaid, he was sorry he was unable to concur in the opinion of the hon. and gallant Officer. The alteration proposed was not expedient, inasmuch as it would greatly contract the court for the passage of carriages, and would tend materially to deprive the division lobby of light. It would not, he thought, be justifiable to vote public money for the purpose. The drift of all the assertions made on the subject and of the Report of the Committee was this:—There was a desire on the part of some hon. Members to assimilate the coffee-room of the House of Commons to the coffee-rooms of the clubs to which they belonged—not recollecting that to all the clubs they paid an annual subscription for their maintenance. Hon. Members also expected to be able to get anything and ever thing they wanted at the shortest possible notice, and they did not make sufficient allowance for the occasional crowding of the dining-room, although they must be aware that there was no club which was not at times inconveniently crowded. He was not aware whether any arrangement had been proposed for the purpose of devoting to the use of Members of the House of Commons the first coffee-room into which they entered, and in which persons who were not Members of that House frequently dined. If that were done, the pressure and inconvenience to which Members were now subjected might probably be removed. Considering the uncertainty as to diners, he believed it was morally impossible for any man to provide for that large influx of Members who occasionally dined in the coffee-room, for the manager never knew until the last moment whether the number would be large or small. That fact might be exemplified by what took place the other evening. The hon. and learned Member for Sheffield (Mr. Roebuck) had left it in doubt whether he would move that the adjourned debate on the Recognition of the Southern States be proceeded with. If he had proceeded with that Motion, no doubt a very large number of Members would have dined in the coffee-room; but the hon. and learned Gentleman withdrew his Motion, and the consequence was that scores of hon.

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  Members found it convenient to dine elsewhere. Such a thing as that was of constant occurrence. In fact, the longer any one sat in that House the more convinced he would become of the impossibility of making any arrangements in reference to a question coming on or not. He thought, then, they ought to be contented with getting such refreshments as the present coffee-room provided. They should bear and forbear. Before the passing of the Reform Bill, at a time when the House was said to be filled with aristocrats, the coffee-room furnished only three articles, but better than those articles could not be found in any part of London. But at present Members entertained expectations he considered it impossible to fulfil. It was now proposed, in order to assist the manager of the coffee-room, that £200 or £300 a year should be allowed him; but he (Lord Hotham) entirely objected not only to that, but to the allowance which he had already. Whatever hon. Members had in that House, for that they ought to pay. If what was now proposed were done, it would be the first step towards the payment of Members. Let not the Chancellor of the Exchequer, then, be asked to contribute for such a purpose.
  SIR PATRICK O'BRIENsupported the Motion, thinking that the Members of the House were entitled to the accommodation recommended by the Committee. When hon. Members were obliged to be in the House, they ought to have an opportunity of dining there in the same way as at a club. Every Member who dined in the coffee-room admitted that it was necessary to have increased accommodation. ["No, no!"] The expense was very small, and the House would not grudge it. A steak, chop, cold meat, or such plain dinner as could be obtained under the Bellamy administration, was all that was required. If £200 a year were added to his allowance, Mr. Steers would be able to carry out his arrangements.
  SIR JOHN TRELAWNYsaid, they were sinking very low indeed, if they consented to ask Parliament to vote a sum of money for such a purpose. Why should not hon. Members buy a bun or a biscuit when their duty called them to remain in the House. It was really preposterous that hon. Members should not be content with a plain dinner. Did they want to have their washing also done at the public expense? This proposal would be a step towards giving wages to Members. He
  826
  hoped hon. Members would not allow the dignity of the House of Commons to be compromised in this matter. One thing was certain, this could never be called a Spartan Parliament.
  MR. BASSsaid, the same objection applied to any allowance whatever as to an increased allowance. It must be obvious that it would be a great convenience, and a means of advancing business in the House, if hon. Members had an opportunity of dining in decency and comfort. There was no truth more commonly acknowledged in that House. What became of hon. Members at half past seven? A House could not be kept between half past seven and half past nine, and the hon. Gentleman (Mr. B. Osborne) who cheered the hon. Baronet so lustily would no more think of addressing the empty benches between those two hours than he would of addressing the Moon. The House sank at that time in the evening into the hands of third and fourth rates. If there was to be a public allowance for the kitchen, it should be a sufficient allowance; and if the present sum was not sufficient, and the House was not willing to grant a further sum, let it be taken away altogether, and let hon. Members go back to mutton chops. He, for one, should not feel at all degraded by having an allowance voted for the convenience of Members of that House.
  MR. BERNAL OSBORNEsaid, he had been looking about with some anxiety for those grave men, the Financial Reformers, who about two years ago signed an address to the noble Lord at the head of the Government requesting him to control in every way the expenses of the country. [Mr. BASS: I am not one of them.] He had thought that the hon. Gentleman signed the paper; but at any rate the hon. Gentleman represented Derby on financial reform principles, and yet down he came that morning to argue in favour of expensive dinners, and, not satisfied with mutton chops, desired to avail himself of the Consolidated Fund in order that he might dine better. [Mr. BASS: No!] He must say, that as far as he could recollect, the debates in that House were conducted with more order and with a much fuller attendance, between seven o'clock and half past nine o'clock, when simple mutton chops served for their dinner, than at present, when there was a bill of fare in which something like a French dinner was attempted, This ridiculous question, quite un worthy the

  827
  consideration of Parliament, resolved itself into an attack—and a very deserved attack—on the whole building. After spending £3,000,000 on it, the plan of the architect, it seemed, must now be altered, in order to build another dining-room. Now, he (Mr. Osborne) said, if you do anything, do not improve your dining-rooms, but improve your House, and make it a place fit for the debates of a great nation to be conducted in. The Report of the Committee on the Kitchen and Refreshment Booms spoke about the inconvenience arising from the narrowness of the dining-room; but was not, he asked, the whole building narrow?—and if they were content to debate in a narrow room, they might be content to dine in a narrow room. This was an attempt to turn the dining-room into a luxurious club. Why could not hon. Members be satisfied with a plain dinner? The excellent plain fare which the kitchen afforded would not do for the hon. Member for Derby: unless he could get everything of the most expensive character and the best wines, he was dissatisfied. The Committee, first of all, complained of the arrangement under which the spirits and wine were provided, and wished to transfer the patronage of the House of Commons to certain wine dealers, whose names were certainly some of the best in the trade. But then it was proposed that three or four cellars should be provided, each to be placed at the disposal of a different wine merchant. Was ever such a proposition brought before a deliberative assembly? Under the present condition of things he had too often seen the Speaker left alone in that House; but if a great expense should be gone to in building fresh wine cellars, he was afraid that the hon. Member for Derby and other hon. Members would then be passing day and night in the refreshment room. The expense of the proposed alteration was put down at £5,000; but let them be warned by what had occurred with reference to the building of that House, and let them not be too sure that the expenditure would not reach £20,000. The Committee strongly recommended that advantage should be taken of the opportunity to raise the ceiling of the refreshment room; but if they were to have all these alterations, he proposed that they should pull everything to pieces at once, and have a thorough reform of the House of Commons, instead of merely making an attempt to improve the cooking department, which, while adding
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  to the expense of the country, was calculated to bring Parliament into contempt.
  SIR JERVOISE JERVOISEsaid, that he believed that much of the inconvenience now complained of arose from the insufficient arrangements for cooking. He was told that the present sculleries were like a solid block of stone, surrounded with hot coppers, and quite unfit for any person to work in.
  COLONEL WHITEsaid, that the cellars referred to by the hon. Member for Liskeard (Mr. Bernal Osborne) were in existence already, and had not to be built; and he did not see what objection there could be to giving the use of them to certain wine merchants. The only object was to get the best supply of wine, and the wine merchants would find it for their interest to supply them with good wine. If the House thought proper to go on with the present system, he, as one of the Members of the Committee, would be ready to submit to their decision; but he did not see the use of appointing the Committee, if their recommendations were not to be supported.
  MR. BENTINCK, as a Member of the Committee, repudiated on their part any wish to do more than improve the present state of things, which had been extensively complained of. The hon. Member for Liskeard was mistaken with regard to the cellars—not one shilling of expense would be incurred with regard to them. It was merely a different arrangement that was proposed. The cellars were there, and the proposed arrangement would give to hon. Members the stocks of three leading wine-merchants to choose from. The hon. Member for Derby was right in saying that this was a more important question than it appeared. Under present circumstances, it was in vain to hope for a fair attendance of hon. Members in that House between half past seven and nine o'clock, and it would be found advantageous in respect to the public business if hon. Members were able to obtain a tolerable good dinner, though it were of the plainest kind, in a comfortable room near at hand. What the Committee proposed was, that there should always be a plain dinner ready, as now; but that hon. Members should be able to have anything they chose at a reasonable notice.
  VISCOUNT GALWAYwas understood to say that he would vote against the Motion.
  MR. COWPERcould not agree with those hon. Gentlemen who said that this

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  was too unimportant a subject to occupy the attention of the House. A very important part of the debates was carried on at the time generally known as the "dinner hour." That, he believed, had arisen from strict adherence to ancient custom; for when it was first settled that the Commons should meet at four o'clock, the Members used to dine at two or three o'clock, and had finished dinner before the business of the House begun. Foreign legislative bodies, he believed, met the difficulty by adjourning during the dinner hour; but our custom was that the House should continue the sitting, and the obvious remedy was, that the Members should have the opportunity of dining within the walls of the House. A very simple dinner ought to suffice, but still such a one as would not sour their tempers, and send hon. Members grumbling back to the House. He thought that the House ought to be grateful to the Members of the Committee for the pains they had taken to make arrangements by which Members might dine, within hearing of the division bell, comfortably and simply. He felt that there were great difficulties in the way of the proposition of the Committee to incur an expense of about £5,000 for enlarging the dining-room, and he wished the Committee still to consider whether the desired object could not be attained without the expenditure of money, by a different arrangement of the tables, and by including for the use of Members that part of the dining-rooms which was now open to persons who were not Members of the House. As there seemed to be so much difference of opinion on this subject, and as it was so late in the Session, he would recommend the hon. and gallant Member for Westminster (Sir De Lacy Evans) to withdraw the Motion, with the view of reconsidering the subject next Session, when, perhaps, some other proposal might meet with more unanimous concurrence than the present.
  MR. DILLWYNsaid, he entirely agreed with what had been said by the First Commissioner of Works, and was glad to hear that he did not propose to alter the architecture of the building, because if they once began to do so, there would be no knowing where they would stop, and probably they might end in spoiling the whole edifice. With regard to the dinners, what they wanted was not a better description of dinner but better food and of better quality. At present the meat was extremely bad, and what they asked was that
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  it should be eatable. If it was, that was all, in his opinion, they had a right to expect.
  SIR DE LACY EVANSconcurred in the suggestion of the Chief Commissioner of Works, and consented to withdraw the Motion.
  Motion, by leave, withdrawn.

PARTNERSHIP LAW AMENDMENT (re-committed) BILL— [BILL 172.]

  COMMITTEE.
  Bill considered in Committee.
  (In the Committee.)
  MR. HUBBARDsaid, that when the Bill was first brought to his notice, he could not help attaching weight to the amount of evidence in its favour proceeding from various Chambers of Commerce and from the London Society for the Improvement of the Mercantile Law; but he found upon a comparison a great want of identity between the provisions of the Bill as it now stood, and those of the Bill which had been supported by Petitions. Many of the provisions of the original Bill had been struck out, and the measure as it now stood no longer answered the description to which the Petitions referred. One of the objects of the Bill was to enable clerks and servants to receive a portion of the profits in lieu of or in addition to salary, without becoming partners. But legislation for this purpose was unnecessary, for, according to very high authorities, clerks receiving a portion of their salary in a fixed stipend could even now participate in the profits without becoming partners. When it was asked why legislation was required on this subject, they were told to look back for the last two or three years, and they would see that Parliament had committed itself unreservedly to the principle of limited liability for companies, and therefore it was expedient to persevere in the same course. He, however, maintained that the legislation on that subject was as yet but tentative, and that the Act of Parliament was still on its trial, and he was very far from admitting that it had been altogether beneficial. It had given birth to numberless companies, but they were as yet far too young to give proof of their utility. No less than 2,600 companies had been registered under the provisions of the Act; and 330 appeared in the last Return laid on the table of the House as having been registered within the first five months of the

  831
  present year. Of those 330 companies thirty-three were banking companies, and thirty-three were hotel companies, numbering among their directors Members of that and of the Upper House. Very probably the two hotels proposed to be established at Richmond, under the presidency of two noble Peers, would be admirably conducted for the comfort of their guests; but he doubted their proving, under such distinguished management, a profitable investment for capital. There were in the Return some companies of an ambiguous character. One company had for its object to deal in church livings and buy advowsons. There was no amount of extravagance which these schemes stopped short of; and he held in his hand the prospectus of a company for enclosing, planting, cultivating, and colonizing the Goodwin Sands. He admitted that occasions might arise when persons combining to carry out some great public object would require to be protected against the unlimited responsibility of ordinary partnerships. Such was the case in respect to the formation of railways, the erection of dwellings for the labouring population, and the establishment of baths and wash-houses. But the motive for granting the same protection in the case of private partnerships altogether failed, as in respect to those there was no public object to be gained, nor did the object demand the extensive combination of capital. If a man lent money to a friend or agent who did not trade beyond the limits of that capital, then he was liable to lose only the amount which he had advanced; but if the agent traded to the extent of five or ten times that sum, then it was only fair, that if any one suffered, it should be the capitalists, and not the innocent creditors. The capitalist would have taken his share of the profits of the trade, and ought to bear an equal share of the losses. Under this Bill, however, the principle on which capitalists would trade was "heads I win, tails you lose." There was at present no difficulty whatever in obtaining credit. In fact, the evil was rather the other way, and some check was required upon the extravagant abuse of credit. The consequence of the system now proposed would be that a man of means could choose a number of agents, and encourage them in the most reckless overtrading, assured, that if affairs turned out badly, he could intrench himself within the limits of the capital which he had advanced to each,
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  and that the creditors could not come upon him for a penny more. It had been said that this system had been introduced into the United States and France. He asked any one who was acquainted with the United States whether commercial character stood high in that country? Was it not true that a man could start in business, fail, compound with his creditors, and, starting again, go through the same process of failure and composition, and that he could do this repeatedly without any check on his course of adventurous speculation? That was not a system which was congenial to English tastes or notions. We placed a high value on commercial integrity and success. The honour of a mercantile man was as delicate as that of a woman, and once tarnished could scarcely ever be retrieved. He hoped that it would be long before we changed our views on such matters. It had been said that experience in France was in favour of this measure. But, on the contrary, as to that country it was not difficult to trace the results of the system now advocated, in the increased number of bankruptcies, which from 4,000 in 1860, had risen to 4,862 in 1861, and had attracted the comments of the Parisian press. He had recently read in La France newspaper the lamentation that the one black spot on the statement of the Minister of Commerce was the enormous increase in the number of bankruptcies. The experience of France, therefore, was opposed to, and not in favour of, this measure. The commercial genius of the two nations was also very different. That of France was distinguished by a love of speculation without industry, while that of England was exhibited in a devotion to industry and in a distrust of speculation. Mr. J. Stuart Mill had been cited as favourable to commandite partnerships; but he nowhere gave any countenance to the idea that capitalists who carried on business through agents should be exempted from all liability beyond the amount of the money they advanced. He trusted Parliament would not sanction the measure now before the House; for if it passed, it would powerfully tend to discourage measured and cautious trading, and would stimulate a system of reckless and irresponsible speculation. He moved that the Chairman do now leave the chair.
  Motion made, and Question proposed, "That the Chairman do now leave the Chair."
  MR. CAVEsaid, that as he had been one of the Select Committee who had gone through the clauses of the Bill, he wished to say a few words. There was no one in the House for whose opinions on commercial questions he had a greater respect than that of his hon. Friend the Member for Buckingham. He had listened attentively to his long and able exposition of the principle of limited liability, and had felt relieved when he found that the hon. Gentleman had hardly touched the real point at issue in the present case. He fully concurred with the hon. Gentleman in regarding the benefits of limited liability as extremely questionable. He admitted the principle that a participation in profits ought not to be dissociated from liability to losses, and that while partners were sometimes hardly used, the case of the creditors was generally harder still. There was also no want of capital, not only for reasonable projects, but for the most hazardous and even dishonest schemes. The tendency of limited liability was, in his opinion, to encourage a dangerous spirit of speculation. Many a man helped to set afloat a wild scheme by risking a certain sum, who would not otherwise have dreamed of it, and thus a snare was laid for others. It was, as his hon. Friend said, just like gambling in a lottery, and a lottery had been defined as a tax which pressed unduly on the poor, because they were least able to resist the temptation and least able to bear the losses which they were thus tempted to encounter. But the principle of limited liability had already been settled by the House. It was too late to discuss it; and that being the law, this measure was a most innocent application of it, and indeed would, it seemed to him, mitigate rather than extend the evils of limited liability. Suppose, for instance, that A, B, C traded together, and that credit was given to them as rich men. If the firm came to grief, and it was discovered that A B and C were liable only in a small degree, and not to the extent of their means, then the creditors might truly say they had been deceived. But suppose, on the other hand, that A and B were a firm to whom credit was given, and that when A and B failed, it appeared that C, who had never appeared in the concern, was also liable to the extent of £10,000 of which the creditor had known nothing; surely that would be to the advantage rather than otherwise of the creditors, who thus obtained a better security than they
  834
  had expected. The principle of limited liability having been once established, this certainly was a most harmless method of carrying it into effect. He looked upon the clause which legalized the payment of clerks according to profits as most valuable. It had been said that this could be done now. Mr. Hering had informed the Committee that such was his opinion; but a great authority, the Member for Walling-ford (Mr. Malins), held a different opinion. It seemed therefore advisable that this doubt should be set at rest. For these reasons he supported the Bill.
  MR. GOSCHENheld that the law, as it stood at present, was defective to this extent—that it hampered the legitimate freedom of contract between man and man. He was of opinion that that freedom should be permitted to the fullest extent, and that when a contract was not against public policy it ought not to be interfered with. The opponents of the Bill were, therefore, bound to show that it would be dangerous to trade and credit, and likely to tend to fraudulent insolvency. If that could be proved, then he admitted that no argument as to the desirability of the objects of the Bill in other respects would avail. The hon. Member for Buckingham (Mr. Hubbard) was very fond of laying down the principle that a participation in the profits of a business ought to imply a corresponding participation in the losses. That principle was, no doubt, a sound one; but it was not impugned by the Bill, under which the liability to loss would be equal to the chances of gain. Capital, loss, and gain, would be limited in the same proportions. Practically, in all cases, there was a limit both to capital and liability. A man was liable only to the amount of that which he possessed; and when the responsibility of a capitalist was confined to the amount which he publicly stated he had advanced to a certain firm, he did not see that the creditors had any right to complain. Suppose there was one firm of two persons, each of whom put £5,000, his whole fortune, into the business; and another firm, also of two persons, one of whom invested his whole means, £5,000, and the other only half his means, being also £5,000. In each of these cases the creditors would give credit on £10,000; but while in the second case they would know that one partner had provided £5,000, they would not know at all in the other how much either had invested. It could not be said that this Bill would

  835
  help to mislead creditors; and, besides, creditors were not always so innocent and credulous as the hon. Gentleman seemed to think. A young firm would be most likely to apply, in the first instance, for assistance to one of the great discounting houses, who could easily learn, by a reference to the register, how much capital had been advanced to them. The effect of the register would be to produce much more certain knowledge and much less vague guessing as to the resources of customers than was now the case. It was all very well for a wealthy and influential firm to say, "We will take our stand on our whole capital—we do not shrink from the most unlimited liability." But the House of Commons ought not to look at the question from the capitalists point of view only—the smaller capitalists and traders ought also to be considered in the matter. He denied that the Bill would lead to a greater number of fraudulent bankruptcies—on the contrary, he thought it would rather tend to prevent them; and he did not see that any one would be tempted to speculate more rashly and recklessly because he had been assisted by an advance of capital. It had been said that the very precautions taken in the Bill were a proof that the promoters themselves apprehended fraud. These provisions were, however, intended to define the responsibility, and were more in the nature of a land-mark than a fence. The principle of liability to loss going hand in hand with participation in profits was not impugned by the Bill, for the capitalist would still be responsible to the extent of the sum advanced, which would, in turn, be the measure of his share of profit. The object of the Bill was not to give the means of obtaining credit, but of deserving it. It was impossible to conduct any mercantile business without involuntarily taking and giving credit for longer or shorter periods at every moment, and it was very desirable that young firms should; and it was for this reason, and not in order to be able actually to borrow money, that young firms required credit. Such credit they could get by the support of a limited partner. At present, the law forbade a man to do what he liked with his own. One could not take a partial interest in an enterprise which one approved without risking one's whole fortune. He supported the Bill on the ground that there ought to be as full and perfect freedom of contract as was consist-
  836
  ent with the interests of commerce and morality.
  MR. VANCEsaid, it was enough to prove that there was no necessity for the Bill, and he believed that the Bill was absolutely and entirely unnecessary at the present moment. He thought the existing Limited Liability Act was sufficient for the purpose of the commerce of the country. He did not think that principle ought to be extended to private partnerships, because there was ample capital ready to be employed in all legitimate undertakings in private partnerships. In the case of a limited liability company, the word "limited" warned the creditors of the state of affairs; but under this Bill they would be able to ascertain the condition of a firm only by searching the register. He denied that private partnerships were merely contracts between man and man. There were third parties who were interested, and they were the creditors. The system of limited liability in other countries provided certain checks which were wanting in this measure; and as there was no necessity or demand for it, he should vote against it.
  MR. W. E. FORSTER, said, that the hon. Member who had just spoken seemed to misapprehend the character of the Bill. It was not a Bill for the purpose of increasing or finding capital for any particular species of business, but a measure to remove the unnecessary interference which by law now existed between the buyer and the seller. He could not see why a person should not be allowed to make a bargain with a firm which consisted of partners with limited and unlimited liability, when he knew the position in which it stood; nor did he see why a man should not advance money to a firm without risking his whole capital. It was not their duty to secure the capitalist by law—the capitalist must secure himself. Nor was it their business to protect the creditors—all that they were bound to do was to take care that the creditors had the opportunity of ascertaining the position of the firm; the law neither could nor ought to save them from the consequences of their negligence if they did not choose to make proper inquiries. All he had to do was to look into the register; and if he found that so much capital was engaged in the concern, it was for him then to say whether he would lend his money or not. Such a register would be very generally useful, for by its means information would be fur-

  837
  nished to men in business which was now often beyond their reach.
  MR. T. BARINGsaid, he wondered whether the promoters of the Bill really thought that it could or ought to be passed in the present Session. This was not a Bill which, if it became law, would be a dead letter, and it ought not to be considered in a House of not more than twenty or thirty Members, and in the absence of all the legal authorities of the country, as was the case at that moment. Such a Bill as this ought not to be submitted to them by a private Member, just as he would a Turnpike Bill or any measure of that kind. If such a Bill were necessary, it ought to have been introduced by the President of the Board of Trade on the authority of the Government. So far from that having been the case, the right hon. Gentleman the President of the Board of Trade opposed, on the second reading, many of the provisions of the Bill. It was true that since then the Bill had been referred to a Select Committee; but he was in a position to state that no two members of that Committee were agreed as to what was the present state of the law upon the subject, or what the effect of the Bill would be. There were two eminent members of the legal profession on the Committee, who differed as to whether the 14th clause was necessary at all. Under those circumstances, ought they now to proceed with this measure, when none of the Law Officers, and not a single member of the legal profession, was in the House. The principle of this Bill was this—that a person might register the amount of money that was placed in a firm, but there was to be no register or limit of the engagements into which such firm should enter. There would be nothing to show whether the money had been lost, or whether any portion of the profits had been left in the concern. It was proposed in the Select Committee that a provision should be introduced, that the word "registered" should be used by all firms taking advantage of this Bill; but that would not suit the promoters of the measure, and so the proposition was rejected. This Bill struck at the principle upon which British commerce had always been conducted—that where a man received any portion of the profits of any trading concern, he should also bear his share of the losses that might be incurred. That principle supplied a proper stimulus to caution; but the present measure would destroy all such stimulus. Con-
  838
  sidering the state of the Session, he put it to the hon. Member for Birmingham (Mr. Scholefield), whether it would not be better, in the interest of those who were promoting this measure, to withdraw the Bill for the present Session; and he would ask the Government whether they could support the suggestion for going into Committee on this Bill when there was not a single Law Officer of the Government present?
  MR. WEGUELINsaid, that if a capitalist had the means of knowing with whom he was dealing—which was what the present Bill proposed to afford him—it could not be said to be a Bill for the encouragement of fraudulent trading. He maintained that there was a great public advantage to be gained by this Bill. Its effect would be to make the trade of the country depend, not upon credit, but upon responsible capital. This was an important public consideration. Every one knew upon what flimsy and specious pretences credit could now be obtained. In the case of the Western Bank of Scotland it was proved that they had given credit to one firm with unlimited liability, which had drawnbills on thirty-seven men of straw in London. That was the way in which business was carried on under the present law; but if this Bill was passed, the capitalist would have the means of knowing with whom he was dealing; and if he misplaced his money, it was his own fault. There was plenty of money to carry on trade, but it was in the wrong hands; it was in the hands, not of those who carried on trade, but of great capitalists and bankers, who were not responsible at all. Upon some flimsy pretence a man might raise £100,000, and thereby unduly extend his credit; but if a capitalist were allowed to pay into a firm some £20,000 or £30,000, the credit attached to that firm would be in proportion to the loan capital, and to the talent and character of those engaged in the business. In fact, limited liability was a restriction upon credit, the undue extension and abuse of which was one of the main causes of all those calamitous crises which had afflicted our trade and commerce in recent years.
  MR. MILNER GIBSONsaid, the Government introduced a Bill in the year 1855 for the purpose of amending the law of partnership, but it was not received favourably by the House. He apprehended, that if he were to introduce a similar measure now, he should not get much sup-

  839
  port from the hon. Member for Huntingdon (Mr. T. Baring). He (Mr. Milner Gibson) had heard no reason for the House not going into the consideration of the clauses of the present Bill. The House had read the Bill a second time; at that time the hon. Member for Birmingham was told to take his Bill to a Select Committee. It had been considered by a Select Committee, and now the House was asked to decline to consider the clauses, and upon that stage the hon. Member for Buckingham took the extraordinary course of raising a general debate upon the principle of the measure. The hon. Member ought to have done that on the second reading; and he (Mr. Milner Gibson) protested against this most harsh and unusual mode of defeating a measure. He admitted that the clauses were still susceptible of improvement. The argument of the hon. Member for Buckingham was, that a trader ought not to be allowed to trade on borrowed capital, as would be provided by this Bill, without the lender being liable to the full extent of his means for the debts of the concern. Why, under the present law a person could very nearly do all that the hon. Member for Buckingham objected to. The hon. Member wanted, in fact, to alter the whole law of partnership in a restrictive sense. He (Mr. Milner Gibson) thought the House ought to proceed to the consideration of the clauses.
  MR. BAZLEYthought the effect of this Bill would be to protect private individuals at the expense of the general public, and therefore he should support the Motion of the hon. Member for Buckingham. The vast structure of English commerce had been raised on the principle of individual responsibility, and he trusted the House would not sanction any departure from that doctrine. The Committee would exercise a sound discretion in deferring the consideration of this measure; and he hoped the hon. Member for Birmingham would withdraw it.
  MR. LINDSAYsaid, the principle of the Bill was precisely the same as the principle of the existing Act, with this exception, that under the existing Act there must be seven persons in a limited liability company. If seven, why not two, as proposed by this Bill? The principle in both cases was precisely the same. Hon. Members were fond of talking about the public interests being affected by this Bill, but they never said how the public interests were to suffer by it. In point of
  840
  fact, the Bill would protect the public as far as the public could be protected in such a matter. The hon. Member for Huntingdon (Mr. T. Baring) of course opposed the measure, because he invariably opposed any measure of progress. The great object of this Bill was to draw nearer and nearer talent and capital. At present capital was kept apart from talent, and so hundreds of men of the stamp of the Stephensons, who had power to benefit this country, passed away unknown.
  MR. STANILANDsaid, that there would be something in the argument of the hon. Member for Buckingham if it could be shown that under the existing law there was no reckless or rash speculation; but the fact was, that in nineteen out of twenty instances, where people failed during preceding monetary crises in this country, they were persons who traded recklessly on borrowed capital. How could the position of the capitalist be worse because he knew the amount of capital in the firm with which he transacted business? It seemed to him that this was a question between those who possessed colossal capitals and those who were in an inferior position. He should support the Bill.
  COLONEL DICKSONsaid, he should oppose the Bill, though he was a warm advocate of limited liability. The hon. Member for Sunderland (Mr. Lindsay) said, that this Bill would have the effect of bringing talent and capital together, but there were two descriptions of talent which might be employed in cases of this kind. One of them was applied to the carrying-on of legitimate and honest trade, and the other was used in ensnaring innocent persons into investing their money in swindling undertakings, which ended in their ruin. This Bill, he believed, was likely to encourage speculators of the very worst kind, and for that reason he would give it his opposition.
  Question put, "That the Chairman do now leave the Chair."
  The Committee divided:—Ayes 40; Noes 70: Majority 30.
  Clauses 1 to 8, inclusive, agreed to.
  Clause 9 (The Firm of a Limited Partnership shall not include the name of any Limited Partner, or else Limited Partner to become General Partner.)
  MR. GOSCHENsaid, that the terms of this clause would limit the operation of the measure in an undesirable manner. Great importance was attached by mercantile

  841
  houses to the preservation of the historical names of the firm, even after the individual bearers of those names had retired or passed away. But under the terms of this clause that could not be done if a retiring partner, who had given his name to the firm, had a son of the same Christian name as his own also in the firm, and if such retiring partner wished to leave a certain portion of his capital in the business. To remove that anomaly, the hon. Member therefore moved a verbal Amendment in the clause.
  Amendment proposed, in line 18, after "registered," leave out to the end of Clause.—(Mr. Goschen.)
  MR. MURRAYthought the difficulty might be overcome by the use of the words "senior" and "junior" where the names of the father and son were identical.
  MR. THOMSON HANKEYsaid, that that suggestion would not meet the necessities of the case. If he were to retire from the firm to which he belonged, he would be precluded by this clause from leaving a portion of his capital with it as a limited partner, merely because he bore the same name as his father, whose name was still continued by the firm.
  MR. ALDERMAN SALOMONSobjected to the Amendment of the hon. Member for London (Mr. Goschen), which he believed would damage the Bill exceedingly.
  MR. HUBBARDalso opposed the Amendment. This Bill had been recommended to them on the plea that everything under it was to be excessively frank, transparent, and straightforward. Yet now the hon. Member for London proposed that firms should be carried on under limited liability with names which had no real connection with them.
  MR. CRAWFORDsaid, he was in favour of the Amendment.
  MR. C. TURNERthought the use of obsolete or fictitious names should not be permitted in the case of partnerships with limited liability.
  SIR STAFFORD NORTHCOTEunderstood the object of the clause to be to prevent the style of a firm from including the name of a limited partner "or any name identical therewith." He would suggest that the difficulty might be obviated by requiring that where the names were identical there should be some additional words of description as to residence, avocation, or the like, so as to distinguish the limited partner from the general partner.
  MR. GOSCHENwas disposed to think
  842
  his Amendment went too far. The best way, perhaps, was to negative the clause now, and have it brought up in a different shape in the Report.
  MR. W. E. FORSTERthought the object should be so to frame the clause as to prevent fraud by an unlimited partner changing himself into a limited partner without its being publicly known.
  MR. C. TURNERobserved, that a fictitious credit was often given to limited partnerships by their agents abroad, who were in the habit of drawing upon them without distinguishing them as limited. The law did not make that punishable.
  MR. ALDERMAN SALOMONSthought this a matter of most momentous character. The distinction between the general and limited partners must be preserved. The name of the unlimited partner appeared; and if he contracted debts, he was liable to the whole extent of his fortune. The names of the limited partners did not appear, and they were not the parties to whom credit was given. Their liability was therefore limited.
  MR. SCHOLEFIELDsuggested that the Amendment should be withdrawn and brought up again on the Report.
  MR. C. TURNERthought the proper course would be to postpone the clause.
  THE CHAIRMANsaid, as the clause had been already amended, it could not be postponed.
  Amendment agreed to.
  Clause, as amended, agreed to.
  Clauses 10, 11, and 12 agreed to.
  Clause 13 (General Partners only to be made bankrupt).
  MR. MILNER GIBSONobserved, that there was a defect in the Bill which ought to be remedied. The hon. Member for Birmingham (Mr. Scholefield) had defined the rights and liabilities of a limited partner in case of the bankruptcy of the general partner, but not in any other case. It was very important that the rights and liabilities of limited partners should be clearly defined. Had they any power of interference? Could they call for the inspection of accounts? Could they take an active part in the making of contracts or managing the business? The term was at present unknown to the law; and the point was the more important, because, by a recent decision of the House of Lords, a person might lend money to a trading concern and receive interest varying with the profits, without being constituted a partner.

  843
  They might raise a doubt as to that by this Bill, unless they clearly defined the rights and liabilities of limited partners.
  MR. ALDERMAN SALOMONSthought the Committee upstairs had directed their attention to that point. On the Continent the name of no limited partner appeared in the partnership. All parties whose names appeared were solidaires—that is, they were liable to the whole amount of their property. The limited partners could not ostensibly carry on the business. If they did advise, or take any such responsibility, they would become unlimited partners.
  MR. CAVEsaid, that the Committee had carefully considered the point, which had been brought before them more than once by the President of the Board of Trade. The Committee had come to the conclusion that there was so much doubt about the length to which the decision of the House of Lords went that it would be dangerous to rely upon it.
  MR. T. BARINGbelieved that no one in the Committee knew exactly what the law was.
  MR. POTTERthought the impression in the Committee was that a person lending £5,000 to a concern as a limited partner might take any share in the conduct of the business, or do just as he pleased, only his liability as a partner was restricted to £5,000.
  Clause agreed to.
  Clauses 14 and 15 agreed to.
  Clause 16 struck out.
  Remaining Clauses agreed to.
  New Clause (Recovery of Penalties) agreed to.
  MR. CHILDERSwished to know what would be the effect of the Bill upon firms trading in England and the British possessions. The passing of the Limited Liability Act had led to great inconveniences. Partnerships had been formed in London whose business was conducted in some of Her Majesty's possessions abroad, and doubts had arisen as to whether the law of limited liability extended to those firms abroad, and he believed a circular had been sent to the Governors of British possessions acquainting them with these doubts, and giving them permission to invite the Colonial Legislatures to pass some measures upon the subject.
  THE SOLICITOR GENERALsaid, it was not easy to deal with abstract cases, but he did not see how, without some
  844
  action by the Colonial Legislatures, the case suggested could be met. If the firm were an English firm, its dealings in any part of the world would be governed by English law.
  House resumed.
  Bill reported; as amended, to be considered on Monday next, and to be printed. [Bill 242.]

ANCHORS AND CHAIN CABLES BILL.

  [BILL 95.] COMMITTEE.
  Bill considered in Committee.
  (In the Committee.)
  Clause 1 (The Board of Trade may grant Licences for proving Anchors and Chain Cables, and may suspend or revoke Licences).
  MR. CAVEproposed an Amendment, the object of which was to enable the manufacturers who now possessed testing machines to make use of them under the Bill. The certificate of many of these manufacturers was a better guarantee than a public test, which in most cases only proved that the welds were properly fastened, while many chains of inferior iron were enabled to bear the strain test by being strengthened by inordinately large stay pins. The Admiralty always guarded against that by regulating the size of links and stay pins, and by careful examination. This was shown by Mr. Clark's evidence before the Committee of 1860, and in page 146 of the Appendix to the Report. First-rate manufacturers now did the same; but if their power of testing was taken away, although the sale of inferior articles would be prevented, yet there would be a risk of bringing the work of superior manufacturers down to the lowest authorized level, just as the Building Act has done with respect to the walls of houses. Besides, public machines would be all of the highest power—that is, capable of testing 2¼ inch cables by a strain of 91½ tons, whereas ordinary merchant cables were one inch, requiring a strain of eighteen tons only. Small outports would not be able to support, nor would require, a public machine of full power; in such cases it would be almost necessary to depend upon the machine on the premises of the manufacturer, all that would be requisite being to ensure that the test was faithfully applied. Under the Bill there was a threefold safeguard:—First,

  845
  by the Board of Trade being enabled to grant, refuse, and withdraw any licence; next, that the testing machine might be certified by a Government engineer; and thirdly, that every testing might, if necessary, be performed in the presence of a Government inspector. This was a stringent Act, and his object was that it should work as easily as possible. He therefore begged to propose this Amendment, which was absolutely concurrent with the 11th recommendation of the Report of the Committee of 1860. The hon. Gentleman concluded by moving his Amendment.
  Amendment proposed, in Clause 1, line 12, after "public bodies or companies," to insert "or private companies or parties,"—(Mr. Cave.)
  MR. MILNER GIBSONsuggested the substitution of the word "persons."
  MR. BENTINCKopposed the Amendment, which would defeat the main object of the Bill. If irresponsible persons were to apply the test, there would be no safety, which could only be attained by requiring the testing to be done under the superintendence of a Government officer.
  MR. LINDSAYsaid, he could not understand how any objection could be raised to the Amendment; but before proceeding further he wished the hon. Member who had charge of the Bill to state to the Committee how he expected it to work. For his own part, he believed the Bill, if passed, would be utterly impracticable; and he could not approve, at this period of the Session, of wasting time upon a Bill which, if passed, must remain a dead letter. The House had been a good deal governed by sentimental views upon this question; but he could state that all large shipowners took every means to test, their chains and anchors for their own sakes. There were now seventy or eighty makers of anchors and chain cables in about thirty-five different places, and there were three hundred persons engaged in the sale of those anchors and chains. It appeared to be considered that the testing of anchors and chains was the same as testing guns; but it was not so. A gunmaker selling a weapon which had not been properly tested was liable to a penalty, but not the person who used the gun. But under this Bill not only was there a penalty upon the manufacturer, but also upon the person who bought it, and upon the captain of the vessel which carried it.
  MR. LAIRDrose to order. The hon. Gentleman was discussing the principle, which had already been decided upon.
  MR. LINDSAYsaid, he would confine his remarks to the first clause, which empowered the Board of Trade to grant licences. What power was there to compel anybody to take out a licence?
  MR. LAIRDsaid, there were existing testing machines in many places, and he knew that if this Bill passed, there were many persons who were prepared to take out licences from the Board of Trade. As to the Bill not being workable, he could only say that it had been gone through clause by clause by practical men acquainted with testing machinery. It had been considered by a sub-committee of Lloyd's, who approved not only of the principle, but also of the details; and the Association of Shipowners of London, who had entertained objections to the original measure, were satisfied with the Amendments he proposed, and had withdrawn their opposition to it. With respect to the Amendment, be could not assent to it, and would remind the hon. Gentleman who moved, that although the eminent firm who supplied chains to the Admiralty tested all their work, yet the Government always performed its own test at Woolwich.
  MR. MILNER GIBSONsaid, if the Board of Trade was only to license public companies or corporate bodies, and not private traders, the effect would be to create monopoly.
  MR. LAIRDsaid, he would accept the Amendment if it were so altered as to provide that a manufacturer should not test his own anchors.
  MR. LINDSAYsaid, the Bill would either create a monopoly or it would become a dead letter. Would there be testing machines at all the thirty-five places where chains and anchors were now manufactured?
  MR. J. C. EWARTremarked, that if the Bill should pass, chains and anchors could not be sold without being tested.
  MR. CAVE, in reply to Mr. Gibson, would not object to alter the wording of the Amendment. In answer to other Members, he stated that he did not mean that private firms should test their own manufactures, but that the testing should be done under Government superintendence.
  MR. C. TURNERsuggested that the parties to be licensed should not be manufacturers of chain cables.
  MR. BENTINCKwould not persist in his opposition to the Amendment after the explanation that had been given. He would, however, observe that this Bill was no attempt to create a monopoly, but to check an abuse.
  Amendment amended, and agreed to.
  MR. C. TURNERproposed to add the words "not being manufacturers of chain cables."
  Amendment proposed,
  In page 1, line 11, after the words "persons," to insert the words "not being manufacturers of Anchors or Chain Cables."—(Mr. Turner.)
  MR. CAVEcould not agree to the addition proposed. The object of his Amendment had been to enable manufacturers having testing machines upon their premises to avail themselves of those machines, instead of compelling them to lose the benefit of the outlay incurred in the erection of the machines.
  MR. C. TURNERcould not see that a manufacturer's certificate of the goodness of his own work would be worth much.
  MR. LINDSAYagreed with the hon. Gentleman, and said that that was a single instance of how impossible it would be to make the Bill work. Was it intended to have a Government officer present at each manufactory? The result of the measure, if it passed, would be, that the public would get as bad chains as at present, but with a deceptive guarantee. He suspected that shipowners wanted to get some other advantage from this Bill. If they could get their equipment certified by the Board of Trade, and anything happened to their ships, they could reply to any objection of the insurance companies, on the ground of insufficient equipment, that they possessed a certificate from the Board of Trade. In short, it was sought to shift responsibility from the shipowners, and that was one chief reason why they supported the Bill.
  MR. LIDDELLsaid, if there were any apprehensions upon that ground, a clause might easily be introduced, providing that no responsibility at present cast upon the shipowner by law should be diminished in consequence of the passing of this Bill.
  MR. R. HODGSON, on behalf of the shipowners, protested against the statement of the hon. Member for Sunderland (Mr. Lindsay). They did not support the Bill from any desire to escape the responsibility which at present rested upon them. He believed that their only
  848
  motive was to make their ships and the lives of those who ventured in them as safe as possible. But he was of opinion that some better means than that in the Bill should be provided for securing testing machinery and testers throughout the country.
  MR. T. BARINGalso denied that this was a Bill put forward in the interest of the shipowners. Its object was the preservation of life and property.
  MR. HORSFALLdenied that the Bill would relieve shipowners from responsibility. Every shipowner had a certificate of much greater value than that now proposed—namely, a certificate from the Board of Trade that his ships had qualified masters and mates. Yet his responsibility was not thereby diminished.
  MR. LINDSAYsaid, that the regulation referred to by the hon. Gentleman did release shipowners from some responsibility, because now in case of loss of life or property no one could declare that the ship had not a competent master. So it would be with these anchors and chain cables. He did not mean to cast any reflection on the shipowners as a body, but thought it far better to leave the responsibility with individuals than attempt to legislate on such a subject.
  Question put, "That those words be there inserted."
  The Committee divided:—Ayes 60; Noes 30: Majority 30:—Words added.
  MR. MILNER GIBSONasked, whether no person who had ever manufactured chain cables or anchors was to be entitled to the testing licence.
  MR. C. TURNERsaid, the meaning of the words was obvious—that no persons being manufacturers at the time could hold a licence.
  MR. LAIRDsaid, the object was to prevent any person from testing his own anchors.
  MR. MILNER GIBSONpointed out that by preventing manufacturers from doing this you, in fact, rendered worthless the capital they had invested in testing machines.
  MR. C. TURNERthought it very unadvisable that a manufacturer should be allowed to test either his own or his friend's chains or anchors. In many cases, no doubt, the test would be honestly applied; but if this were permitted, public confidence in the result would be destroyed. To be of any value the certificate must be given by independent parties, in whom the public could feel confidence.
  MR. LINDSAYconcurred in thinking that the certificate should be given by an independent authority; but this decision of the Committee suggested with renewed force the question, what guarantee existed that any such authority would set up the testing machinery; and if not, the whole Bill would be as waste paper.
  Clause, as amended, agreed to.
  Clause 2 (Testor to test all Anchors and Cables in proper order, and impress the same with authorized Proof Mark).
  MR. LINDSAYinquired who was to be the testor.
  MR. LAIRDsaid, it was proposed to license the present independent testing establishments, if the Board of Trade thought them competent, and the responsibility of testing these articles would be thrown upon them, Inspectors visiting those establishments occasionally to see that the machinery was in good order.
  Clause agreed to.
  House resumed.
  Committee report Progress; to sit again To-morrow.
  House adjourned at five minutes before Six o'clock.