Lords Sitting of 17 March 1859

MINUTES.
PUBLIC BILLS.—la Mutiny; Marine Mutiny; County Courts; Recreation Grounds.
2a Convict Prisons Abroad.
3a Debtor and Creditor.

DEBTOR AND CREDITOR BILL.

  BILL READ 3a, AND PASSED.
  Bill read 3a (according to Order).
  LORD CRANWORTHwould remind their Lordships that when the Bill was in Committee he moved the omission of certain clauses which had relation to the appointment of trustees or official assignees;

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  and that on their Lordships disagreeing from his proposition, he gave notice that in a future stage of the Bill he intended to renew his Motion. Accordingly he now rose to move that clauses 95 to 98 be omitted from the Bill; and if their Lordships should agree that those clauses should be omitted, the effect would be to restore the old or rather the present existing system of bankruptcy so far as related to assignees. Although this might be a very dull subject to their Lordships, he could assure them that to the mercantile community it was one of very great interest and of very great importance. Before the alterations which took place in 1831, when Lord Brougham held the Great Seal, there was no public officer who had control over the funds of bankrupt estates. Such estates were then vested in assignees who were chosen by the creditors; that was, they were nominally chosen by the creditors; but the evidence given before the Commission of 1854, and he believed also before a former Commission, clearly showed that, in fact, the assignees were appointed by the solicitors of the chief creditors, and the fight as to who should be the assignees generally was between the solicitors of the chief creditors, because, in this way, the solicitors obtained the management of the funds and a very profitable branch of business. The result was exactly what might have been expected by a priori reasoning. As the funds of the bankrupt estate were generally very inadequate to meet the claims of the creditors, the general creditors were very lukewarm as to the administration of an estate under such circumstances—especially when the estate was small, as was most frequently the case—and the assignees being much more profitably engaged in their own business, declined to lose their time in attempting to realise a shilling or two more or less in the pound for other parties; and thus the bankrupt's estate was neglected and fell a prey to the legal gentlemen, was absorbed in costs and expenses, and thus a very small portion of the funds ultimately found its way into the pockets of the creditors. By the indifference of these assignees when the new system was introduced in 1831, and official assignees were appointed,who—not alone, but in conjunction with the former assignees—were charged with the duty of getting in the assets of bygone bankruptcies, they actually realized upwards of £ 2,000,000 of money which the assignees had neglected to distribute.
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  These assignees paid the assets of the estates into their private bankers; and in this way sums varying from £100 to £500, and even more, had been lying for years in those bankers' hands. He remembered that Lord Brougham stated that the banking-house of Smith, Payne and Smith had been called upon to pay over sums amounting to nearly half a million which had been so left in their hands. No part of this large sum would probably ever have come into the hands of the creditors but for the appointment of these official assignees in 1831. By that Act the persons to be appointed official assignees were to be persons who had been engaged in trade, but who were thereby rendered incapable of continuing in trade, or having any other duties to discharge other than administering estates in bankruptcy. Since this system came into operation in 1831, the official assignees had collected between £2,000,000 and £3,000,000 of outstanding assets, and had distributed it among the creditors, who, but for them, would have lost the whole of it. Was it expected that, under the new system, a larger sum would be realized from bankrupt estates than was possible under the old? At this moment there was invested in the Three per Cents, in the name of the Accountant in Bankruptcy, sums belonging to bankrupt estates amounting to about £1,500,000, and producing an annual income of about £40,000. It was now proposed by this Bill that the creditors should have the option of dispensing with the official assignee altogether, and of appointing trade assignees only, as under the old system. The name, it was true, was changed to "trustee," but the office was precisely the same. But if that proposition was to be acted upon—and if it were not the mere option was of no consequence—if the old system was to be reverted to, was it possible but that the old results would follow? It was impossible not to anticipate otherwise than that the evils of the old system would be renewed. Indeed, his noble and learned Friend himself appeared to expect it, because in a subsequent clause he had provided that the creditors might appoint a committee to superintend the trustee; in fact, to operate as a check upon him. No doubt there was a great cry in some quarters against the official assignee. But why was that? The truth was, it was because the substitution of creditors' assignees for official assignees meant the substitution of solicitors for the official assignee—the mo-

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  ment it was said that the estate should be managed by the trade assignee it meant that it should he managed by the solicitors of the assignees. Naturally enough there was a strong wish for the alteration among a certain class of gentlemen who had a great deal of influence in "another place," though not quite so much in their Lordships' House. Under the old system the interests of the smaller creditors were completely overborne by the large creditors. The assignees were appointed by the majority in value of the creditors; two or three largo creditors joined together and chose the assignees, the assignees placed the estate in the hands of his solicitor— or, more generally, of the solicitor who had, in fact, appointed him—and the interests of the smaller creditors were entirely unprotected. This state of things would be exactly revived if the old system were returned to. It was therefore, he submitted, their Lordships' bounden duty to interfere for the protection of the smaller creditors against evils which the experience of the old system had fully proved. It was a mere fiction to say that the expense of the official assignees was worthy of consideration; they formed a very small item indeed, in the expenses of bankruptcy. A statement had been forwarded to him by a gentleman of very great experience in bankruptcy (Mr. Freeman), and who had been examined before the Committee of 1852, of the result of ten bankruptcies. The gross assets of the estates were £5,600; and the charges for rent, taxes, &c, being deducted, the net assets were £4,672. It was shameful to have to remark, that from that sum £ 2,684— considerably more than 50 per cent—went in expenses. But what proportion went to the official assignee? Less than the charges of the messengers. The messengers received £329, and the official assignee less than £300—only £294—or scarcely more than 5 per cent on the assets realized. Creditors might say, "Why should we be paying 5 per cent to an official assignee?" But he asked would not the services of an official whose undivided duty was to realize the largest possible amount of assets in the shortest time, and at the least expense, amply compensate for the 5 per cent? It was the duty of their Lordships to protect the smaller creditors, and not to leave them at the mercy of the old system. He would allude to one other point. The great objection to the English bankruptcy system had no doubt been its costliness in comparison
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  with other systems. Now, part of that cost consisted of compensations paid to officers who were put out in 1831, when the new system was introduced. Those compensations were, he thought, most improperly charged on the estates of future bankruptcies. That was a charge that ought to have been borne by the Consolidated Fund, and he thought his noble and learned Friend deserved the highest credit for the alteration which he proposed to make in the law in that respect, by enacting that those compensations should in future be paid out of the national funds. Subject to that payment, the expenses of the Court were properly borne by the Court itself. The Court was a court mainly—to the extent of nine-tenths of it—of mere administration. If they removed the official assignees the trade assignees would not be bound to pay in the funds as they received them to the account of the Accountant— they would place the funds in the hands of their own private bankers. In consequence of this change the interest on the funds in the hands of the Accountant, amounting to £40,000 a year, would be lost to the Court, and the consequence would be that much higher fees would be imposed. The present amount of assets absorbed by solicitors' bills was very large, and he could easily imagine that when the supervision of the official assignees was withdrawn it would be still larger. The noble and learned Lord then moved to omit Clauses 95 to 98 inclusive.
  THE LORD CHANCELLORsaid, he hoped their Lordships would not suppose that the various objections which had been so strongly urged by his noble and learned Friend who had just addressed the House had not been taken into consideration, carefully and anxiously, before those clauses were inserted in the Bill. There was no plan that could be devised that would not be found open to strong, perhaps unanswerable, objections; and the only way to deal with any scheme was to look at the objections on either side. The Government had had the greatest possible difficulty to contend with in judging what provision it would be the best to adopt for the administration of an insolvent estate in the Bankruptcy Court. As he had mentioned on a former occasion there were two distinct classes of opinion which divided the commercial world. One of them was that which his noble and learned Friend represented when urging his objections to this Bill—namely, that the creditors should

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  have no power whatever—should not he allowed to interfere with the administration of the affairs of the insolvent. Many persons of the highest authority in the commercial world took that view; their opinion was entitled to the greatest respect, and would no doubt influence any one framing a Bill on this subject, and determine him to adopt the views which persons of such weight in the City of London represented. But if the Government had framed the Bill on their suggestions they would have encountered a powerful opposition from another class of persons, who since 1831, when the official assignees were first created, and the creditors debarred from interference, had insisted on the right of creditors to have more control over the administration of their affairs. They had complained from time to time that the creditors should have been thrust out of all interference when the Bankruptcy Court got hold of the affairs of an insolvent debtor. Evidence was given to a considerable extent on the subject of such administrations before the Commission of 1852, and the Commissioners appeared to have favoured the views of that latter class. He did not, however, mean to say the question was so clear that any decided opinion had been formed by them on the subject. It was necessary to examine carefully what were the different circumstances that required attention; and in choosing between conflicting opinions it was the duty of the Government to adopt that course which they thought best calculated to do justice to the different classes concerned. To show their Lordships the inherent difficulty of this matter he might observe that a few evenings before his noble and learned Friend presented a petition from 800 merchants and bankers of the City of London in favour of the view which he represented. He (the Lord Chancellor) had been told there was much facility in obtaining petitions of this kind, and that much reliance was not to be placed upon the circumstance that they were presented; but if such petitions were to be supposed to express the deliberate opinion of those who signed them they must be held to have great weight. But he had himself presented a petition from 4,000 of the principal merchants and bankers of London of quite an opposite character to that presented by his noble and learned Friend. Again, a noble Lord (Lord John Russell) had introduced a Bill on this subject in the other House, which Bill was supposed to represent those most important bodies, the Chambers of
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  Commerce in many of the large towns. The Chambers of Commerce, if he might judge from the framing of the noble Lord's Bill, took exactly the same view of the case as that which he (the Lord Chancellor) might say he represented on that occasion in respect of giving to creditors a control over the affairs of debtors when their affairs were to be wound up in the Courts of Bankruptcy and Insolvency. What, then, were the Government to do on this subject? It was quite clear that, whatever course they might adopt, they would meet with determined opposition. They were, therefore, obliged to consider what, in their judgment, was the best course to be adopted to reconcile conflicting interests and do justice to all classes. His noble and learned Friend had argued as if the Bill made it compulsory on the creditors to put aside the official assignees and to thrust the Court out of its office by appointing a trustee of their own. Now, what the clauses which the noble and learned Lord proposed to omit from the Bill proposed was this—that the creditors might have, if they desired it, an opportunity of choosing a trustee, in place of the official assignee, to conduct the administration of affairs in the Court. They might, if they pleased, appoint the official assignee for that office, or they might leave the matter with the Court and the official assignee, according as might appear to their judgment to be best for their interests. Their Lordships would see that there was nothing compulsory there. Would their Lordships reject a scheme which had been been framed after great consideration, and which had almost been forced upon the Government by the demands of the commercial world, and which was designed to remove the complaint of the creditors, that they bad now no power in the administration of their affairs in the Court of Bankruptcy? His noble and learned Friend said that if creditors were left to themselves they would not pay proper attention to the matter; that they were lukewarm. Now it was contrary to human nature that they should be so. His noble and learned Friend also argued that, under the provisions of this Bill, everything would be left to the solicitors, and, in his anxiety to guard against that source of expense and waste, he gave some instances in which, under the careful guardianship of the official assignee, the costs of the solicitors had been enormous. Surely that argument, if a good one, recoiled on his noble and learned Friend him-

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  self, for it showed that the official assignees had not been as careful as they ought to have been in the supervision of the solicitors' accounts. He (the Lord Chancellor) should apologise to their Lordships for having said so much on a subject which had really been exhausted, but he had felt it necessary to state his reasons for thinking that the objections of his noble and learned Friend were not well founded, and that the clauses ought to be retained as they stood in the Bill.
  LORD OVERSTONEsaid, he wished to express his entire concurrence in all the arguments and statements of his noble and learned Friend (Lord Cranworth). He could confirm every statement of his noble and learned Friend. He had said before, and he now again repeated, that the introduction of these clauses was a retrograde step, whether they looked to the interests of creditors or to higher moral considerations. The noble and learned Lord Chancellor had asked what were the Government to do when there were petitions on one side objecting to the official assignees, and petitions on the other to the reverse effect? Let the Government consult the lessons of past experience, which were so clear, distinct, and emphatic, as to leave no room for doubt. What was the origin and cause of the introduction of official assignees? The introduction of official assignees was the consequence of the strong, universal, and indignant feeling, with regard to the abuses that prevailed under the then existing law of bankruptcy. What where these abuses? The funds were imperfectly realized, kept back, or unjustly distributed; improper transactions were concealed, chicanery of every kind was perpetrated, some creditors wore paid in full, in order to protect the debtor against investigation, and others received improper advantages—in short, every species of abuse which could be imagined constantly occurred. Such were the circumstances that caused an overwhelming demand for the institution of official assignees. Had these officers failed in realizing the expectations formed of their utility? He defied any one to maintain such a proposition. The change consequent upon the appointment of the official assignees was immediate and remarkable. As soon as they were appointed immense funds were brought forth and speedily distributed, which, to his knowledge, had for years remained beyond the reach of creditors. And such had been the continued and progressive operation of
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  that part of the bankrupt law. The funds of insolvents or bankrupts had been satisfactorily realized and administered under the new system; and, he should like to be informed, what were the defects, misdoings, or shortcomings, of the official assignees which rendered it necessary to abolish the office? He knew of none. But he objected to these clauses on higher moral grounds. The laws and institutions of the country had a great and powerful influence in regulating the moral character of the people. Let their Lordships beware lest their commercial legislation should lower the tone of commercial morality. Two or three years ago he thought that the measures introduced by the late Government had, on the subject of limited liability, a tendency to lower the tone of morality in the commercial world, and he therefore opposed them. He held that opinion still, and he objected to the present clauses for the same reason. He believed that the knowledge that every transaction would be looked into by an impartial and responsible officer of the Court had a great, effect in checking the tendency to fraudulent practices throughout the trading community. For these reasons, he must give his unqualified support to the proposal of his noble and learned Friend (Lord Cranworth).
  THE EARL OF DONOUGHMOREsaid, he could not help thinking that the noble Lord who had just sat down argued on the assumption that there was a provision in the Bill to abolish official assignees. That was quite an erroneous assumption. Under the present law it was compulsory in all cases that an official assignee should be chosen. The Bill modified this provision by proposing to leave it to the creditors to say whether an official assignee should be chosen or not. The Bill enabled the creditors to be the judges whether they ought or ought not to employ an official assignee; and he thought they were likely to be the best judges on that point. It did not prevent them having recourse to the assistance of an official assignee if they should think it desirable; but it did not enforce the appointment of an official assignee when the creditors did not think it necessary. The creditors as a body would do what they thought would most tend to their own interests; that was what the Bill enabled them to do; and its working in that respect would eventually result in much useful experience as to the class of cases which should be confided to the management of

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  official assignees. He therefore trusted their Lordships would not strike the clauses out of the Bill.
  EARL GREYsaid, he did not think that the objections of his noble Friend had been met by the arguments of the noble and learned Lord on the woolsack, or those of the noble Earl opposite (the Earl of Donoughmore). The whole defence was, that the Bill did not do away with the assistance of the official assignee; it only gave power to a majority of the creditors to dispense with the services of that functionary. It, however, appeared to him (Earl Grey) it was precisely in those cases where it was important for that officer to be employed that the official assignee would not be called upon. In cases where everything was straightforward and bonâ fide the official assignee would be appointed; but it was just in those cases where inquiry was most needed, those of the creditors who had some advantage in concealment would consider the assistance of the assignee as troublesome and undesirable. When it was for the interest of the public that transactions should be brought to light those were the cases in which no official assignee would be called in. When such a bankruptcy occurred, a great many of the most respectable creditors would take no trouble about it, thinking that no advantage could be obtained commensurate with the loss of time which could be more profitably and more agreeably occupied; and then the estate would fall into a few hands, who having probably private interests to serve would manage the affair among themselves, secure from the interference of an official assignee. Neither the arguments of the noble Earl nor of the noble and learned Lord on the woolsack had controverted the statements of his noble and learned Friend (Lord Cranworth). He therefore thought their Lordships should not rashly nor without sufficient reason take a step that would be fatal to a principle of reform which had been recognized in past legislation and had operated for the public benefit.
  On Question, "That the said clauses stand part of the Bill,"
  Contents 38; Not-contents 23: Majority 15.

  CONTENTS.

  Chelmsford, L. (L. Chancellor.)

  Amherst, E.

  Bandon, E.

  Bath, M. [Teller.]

  Beauchamp, E.

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  Erne, E

  Bagot, L.

  Graham, E. (D. Montrose.)

  Boston, L.

  Clifton, L. (E. Darnley.)

  Hardwicke, E.

  Lucan, E.

  Colchester, L.

  Malmesbury, E.

  Colville of Culross, L. [Teller.]

  Rosslyn, E.

  Shrewsbury and Talbot, E.

  De L'Isle and Dudley, L.

  Stanhope, E.

  De Ross, L.

  Verulam, E.

  Dowries, L.

  Doneraile, V.

  Kingston, L. (E. Kingston.)

  Dungannon, V.

  Exmouth, V.

  Lovel and Holland, L. (E. Egmont.)

  Gordon, V. (E. Aberdeen.)

  Redesdale, L.

  Hutchinson, V. (E. Donoughmore.)

  Sondes, L.

  Templemore, L.

  Strathallan, V.

  Wynford, L.

  NOT-CONTENTS.

  Somerset, D.

  Ebury, L.

  Clarendon, E.

  Gage L. (V. Gage.)

  Durham, E.

  Overstone L.

  Granville, E.

  Panmure, L

  Grey, E.

  Ponsonby, L. (E. Besborough.) [Teller.]

  Ripon, E.

  Saint Germans, E.

  Somerhill, L. (M. Clanricarde.)

  Carlisle, Bp.

  Stanley of Alderley, L.

  Down, &c., Bp.

  Teynham, L.

  Belper, L.

  Truro, L.

  Cranworth, L. [Teller.]

  Wensleydale, L.

  De Tabley, L.

  Wodehouse, L.

  LORD CRANWORTHsaid, he had also given notice of his intention to move the omission of Clauses 113 to 116, which had reference to the disposal of the insolvent's reversionary interest. He quite agreed with the principle of the Bill by which traders and non-traders were put on the same footing. But these clauses enacted that with respect to non-traders who became insolvent their reversionary interest in settled estates should not be sold till it fell into possession. He did not see why an invidious distinction, should be made in this matter between traders and non-traders. No doubt it was much more for the interest of the debtor that the sale of reversionary property should be postponed till it fell into possession, and Lord Derby had said that he deprecated the sale of reversionary property at all; but this measure would only prevent its sale in the case of those persons who were tenants in tail; for instance, of a son who was to succeed to a settled estate after his father. It was a provision for the benefit of the eldest sons of landed proprietors, and of no other class, since if a person was entitled to a reversionary interest in funded property, in case of his becoming insolvent it would be sold. The object of these clauses was to give protection to one particular class only, and being so they would not be at all accepted by the public.
  THE LORD CHANCELLORsaid, this statement of the objects of the clauses was not quite correct. It was true that these clauses only applied to the case of tenants in tail of settled estates, because in that case there could be no possible advantage to the creditors in forcing a sale; yet the creditors would have their full rights reserved to them when the estate fell into possession. There was no power to deal with the settled estates without the consent of the protector of the settlement, so that the reversionary interest was one which might never come into existence at all, and was, therefore, of very little value to the creditors, as the protector of the settlement had the means of preventing the sale to any advantage, by refusing his consent. The question, therefore, was whether it was desirable, when for the first time this Bill introduced non-traders to a system by which they would be compelled to part with the whole of their property, that an interest should be taken from them at once which could scarcely be available for the creditors, or whether the interests of the creditors were not better secured by enabling them to avail themselves of the settlement with the consent of the protector of the settlement, and at all events to avail themselves of the reversionary interest when the insolvent should come into possession of it.
  Motion agreed to.
  LORD WENSLEYDALEsaid, that one of the County Court Judges had applied to him to know whether this Bill would affect their powers, and he suggested that a saving clause should be introduced to provide that nothing in the Bill should apply to any warrant of commitment for non-payment of a debt issued by the County Court.
  THE LORD CHANCELLORsaid, that he wished for time to consider this point, and there would be an opportunity of proposing such an Amendment when the Bill sent down to the House of Commons.
  Amendments made: Bill passed, and went to the Commons.

CONVICT PRISONS ABROAD BILL.

  SECOND READING.
  THE EARL OF CARNARVON, in moving the second reading of this Bill said, that its object was to extend to the naval and military prisons, those in Bermuda and in our other convict settlements, the same supervision and control of the Secretary of State which existed for the prisons in Great Britain. The law was at present very imperfect in this respect, and it was de-
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  sirable to give powers for the dismissal or removal of the officers of the prisons, as well as power to make regulations for their management and for the treatment of the prisoners, and to impose a scale of penalties. In this respect the standard which had been adopted was the same that existed in the prisons at home, or if there were any difference, it was rather in favour of the prisoner.
  Bill read 2a (according to order), and Committed to a Committee of the whole House on Monday next.

MONTENEGRO.—QUESTION.
THE EARL OF CLARENDON, who had given notice to ask the Secretary of State for Foreign Affairs respecting the Appointment of two Engineer Officers to define the Boundaries of Montenegro, said—My Lords, three days ago my attention was called to a paragraph under the head of "Military Intelligence," in The Times newspaper, as follows:—
"Orders have been forwarded from the Horse Guards to the head-quarters of the Royal Engineer establishment at Chatham, directing a surveying expedition of the Royal Engineers to be held in readiness to proceed to Montenegro, for the purpose of making an accurate survey of the boundary line to Constantinople. The officers named to accompany the expedition are Captain Cox and Lieutenant Sitwell, R. E. Another expedition of the Royal Engineers is also in course of formation for the purpose of proceeding by the overland route to Persia to survey the Turkish and Persian boundary line. This expedition is likely to be absent from England three years."
Now, I do not suppose for a moment, that, whatever benefits may be in store for the Montenegrins, it is intended to extend the boundaries of that country to Constantinople or the Dardanelles. That then is not the point upon which I wish to ask for any explanation from the noble Earl the Secretary for Foreign Affairs; but I think the opportunity a fitting one for asking for an explanation respecting Montenegro, the affairs in regard to which country I believe last year caused a great deal of trouble to my noble Friend, but with respect to which very little is known in this country. I suppose that subjects of more pressing interest have occupied the attention of the public since the meeting of Parliament. Still the subject of Montenegro is not without its interest, because both the question itself and the manner of dealing with it involves a course of policy, the importance of which is not to be measured by the geographical insignificance of the territory. For many years past Russia, either in a

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direct or indirect manner, has exercised considerable influence in Montenegro, the inhabitants of which country profess the Greek religion; and at the Conference of Paris, when the subject of the Moldavo-Wallachian Principalities was under consideration, it was stated that circumstances had led to a general belief that Russia proposed to adopt the same policy in Montenegro as she had followed in those Principalities, and the Russian Plenipotentiaries were invited to make some statement by which all doubts might, if possible, be cleared up. The Russian Plenipotentiaries did not hesitate to declare that they felt satisfied that Russia had no other relations with Montenegro than such as were caused by the sympathies of the Russian Government and the friendly sympathies of those mountaineers towards Russia. The Plenipotentiaries present of Austria, England, and Turkey, said they looked upon that as a declaration on the part of Russia that she would exercise no undue or exclusive influence in Montenegro. The Turkish Plenipotentiaries moreover declared that although, of course, Montenegro must be regarded as an integral portion of the Ottoman empire, yet the Porte had no intention of altering the status quo. The disclaimer upon the part of the Russian Plenipotentiaries, to which I have alluded, was regarded as no less satisfactory than important, because Montenegro had never been considered independent or the suzerainty of the Porte disputed, and the Congress remained of opinion that the matter was settled. But a short time afterwards Prince Danielo, the ruler of Montenegro, addressed a circular to all the great European Powers which had been represented at the Conference, claiming his independence, and announcing to them that he should come to Paris and London with the view of making good his claim. When I heard that such was his intention I thought it right to inform the French Government that we should object to receive Prince Danielo otherwise than as a subject of the Porte, presented through the Turkish Ambassador, and, if I remember rightly, we obtained their concurrence in the expediency of adopting that course. Be that as it may, Prince Danielo was subsequently received at Paris without the intervention of the Turkish Ambassador, but did not proceed to London, being perhaps under the impression that that ceremony would not here be dispensed with The Porte afterwards expressed its readi-
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ness to accede to the wishes of Prince Danielo, and to grant him such an accession of territory—his own territory being barren and unproductive—as was deemed to be necessary for the subsistence of his people. The Porte hoped by this means to put an end to that disgraceful system of plunder which they had pursued in the neighbouring country; but the terms on which the grunt was to be made were that Prince Danielo should acknowledge the sovereignty of the Sultan —a proposal which he refused to accept. I must now observe to your Lordships that there was an insurrection in Montenegro, and Turkish forces were sent to suppress it. Prince Danielo afterwards took part in the insurrection, and during a suspension of arms—an armistice, I may call it, on the part of the Turks—he fell upon the Turkish forces and massacred a great number of them, and horribly mutilated a large number who fell into his hands. It was then that an intervention took place on the part of France and Russia, and I hope my noble Friend will explain its exact character. It was a matter which seemed very unfriendly towards the Porte, that two French ships of war should be sent to the coast, as though for the purpose of preventing chastisement being inflicted on the perpetrators of this outrage. And then, under the pretext that the Turkish forces had invaded and attacked the Montenegrins, and had invaded the territory and a village belonging to them, and had consequently violated the independence of Montenegro, it was proposed that Commissioners of the Five Powers should be appointed, who should be sent out to survey the country and mark out the new boundaries on the spot, and to them the settlement of the matter was to be referred. But, my Lords, I believe that proposal was never carried into effect, and subsequently the matter was referred to the representatives of the Five Powers of Constantinople; and I suppose it is in consequence of the decision to which they had come, or a desire to give effect to the agreement to which they had come, in reference to marking out the new boundaries, that the Government has ordered these two engineer officers to be sent out to Montenegro. But, my Lords, what has taken place in Montenegro is connected with a system of which, in the case of the Principalities and elsewhere, we have had abundant evidence, and if insurrection is to be excited, and Turkey to be shorn of her power, first in one place and then in

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another, it is quite clear that that integrity of the Ottoman empire which we have made war to maintain, and which forms the basis of the Peace of Paris, will be soon at an end, and that we must prepare for that dismemberment of Turkey which it has hitherto been the policy of the great Powers to avert. But whatever may be the conduct of our Government in this matter, I hope it will be made clear to the world that we remain faithful to that policy which we stand pledged to uphold. What I wish to ask my noble Friend, therefore, is, under what circumstances the question of the boundary of Montenegro was referred to the representatives of the five Powers at Constantinople; what was the determination to which they came; for what precise purpose have the officers to whom I have alluded been sent out to Montenegro, and whether he has any objection to lay the papers connected with the subject on the table of the House?
THE EARL OF MALMESBURYsaid, that no one, he imagined, would be more astonished than the gallant officer who it was stated would go out in command of this alleged expedition when he read the statement that had been made by the noble Earl, allotting to him so arduous a task as that which had been described in the newspapers. He (the Earl of Malmesbury) would now, in answer to the remarks of the noble Earl, proceed to explain to their Lordships the events that had taken place previous to this demarcation of the frontiers between the territories of Montenegro and Bosnia. It would save their Lordships' time if it were admitted at once that up to a certain point—up to the period at which the noble Earl left office—nothing could be more accurate and exact than the account the noble Earl had given of those events; and it was no more than natural that it should be so, because the noble Earl was not only Secretary of State for Foreign Affairs at that particular time, but was, moreover, himself at Paris as the Plenipotentiary of Great Britain when this question was diplomatically discussed, and when the protocol to which the noble Earl alluded, and which he quoted, was signed. Me believed it was on the 28th of February last year, just as the change took place in Her Majesty's Government, that Prince Danielo, having taken the steps described by the noble Earl, and having been received at Paris, as the noble Earl had described, without any diplomatic introduction by the Ambassador of Turkey, his
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suzerain, returned to Montenegro, and from his mountain habitation addressed a circular, or wrote a despatch, to various Powers of Europe—certainly to the Government of England—requesting that the limits between his territory, and that of the Sultan should be marked out, so as to prevent a repetition of those hostile and unseemly raids and insurrections which for centuries past had taken place in that wild region. On the receipt of that despatch, and wishing, as Her Majesty's Government always did in matters of great importance in connection with their foreign policy, to act in unison with their allies, he (the Earl of Malmesbury) instructed Lord Cowley to place the case before the French Government, and to propose to them either to give the English Government some suggestions on the subject or to take such active practical measures whereby a repetition of these contests might be prevented, either by the establishment of a line of demarcation or by some other method. The answer received from the French Government, he certainly did not consider satisfactory; for the French Minister stated that he was not able to make up his mind clearly as to the right of suzerainty of the Porte over Montenegro; that it was not quite clear that any infraction of the rights of Montenegrin independence had taken place, or that other Powers were not inclined to lean to the opinion that Montenegro maintained any other position than that of an independent state, and that the Russian Government had subsequently declared that their opinion amounted to conviction. He (the Earl of Malmesbury) need not refer to the terms of the protocol of Paris, to which his noble Friend had alluded, to show that the Russian Plenipotentiary at Paris disclaimed the existence of any other relations between Russia and Montenegro than those of sympathy, or to prove from the part taken by the Turkish Plenipotentiary, Ali Pacha, that Turkey had no intention of altering the status quo as it existed in March, 1856. Neither would he describe the correspondence that had since taken place on this subject. It was an obsolete matter, now amicably settled, and entirely with the approbation of the Porte, and which it would hardly serve any good purpose to reopen at the present moment. But this he might say that when the French Government threatened that if Turkey did not immediately agree to the proposed demarcation being carried into effect they

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were prepared to recognize the independence of Montenegro, Her Majesty's Ministers announced it to be their intention to withdraw under those circumstances from the scheme of demarcation, to which they were otherwise entirely favourable, and to rest upon the treaty itself for the maintenance of the integrity of the territories of the Porte. It was then deemed the most advisable course to pursue to invite a more general concert of the great Powers in laying down this boundary. It was subsequently proposed, and the Porte approved, that they should all join in sending out a commission to ascertain and settle the point about which there was most difficulty, namely, what was really the status quo in March, 1856, when Ali Pacha declared the status quo which the Porte recognised and adopted. The Porte agreed to the proposal, and accordingly commissioners were proposed and sent; and at this point of his narrative the noble Earl committed a mistake. He said that a commissioner from Montenegro was added to those of the other Powers. That was not the case. It was refused.
THE EARL OF CLARENDON: No, he said that it was a part of the proposition that a Commission for Montenegro was included, but that that was objected to.
THE EARL OF MALMESBURY: Well, it was proposed that there should be a Commissioner for Montenegro, and Her Majesty's Government objected, inasmuch as it would be an indirect way of placing Montenegro on the same equality and footing as the other five Powers; but inasmuch as it was considered that it might act as an embarrassment in defining the line of frontier, if the authority of the Commissioners was not recognized by Prince Danielo, he (she Earl of Malmesbury) considered, and the Powers agreed, that it would be very much to the advantage of the future if Prince Danielo were permitted to send a delegate or a deputy in his own name, who should recognize the limitation laid down by the Forte's consent; otherwise it was quite clear the arrangement might have been upset again, and the Prince might hereafter have said, "I was no party to the boundary to be laid down, and I altogether repudiate such determination." The boundary, therefore, was laid down by the Commissioners so appointed, the deputy or delegate on the part of Montenegro having no voice in the matter. The act was taken by Colonel Churchill, the English Commissioner, and
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by the other Commissioners, to Constantinople, and there a proces verbal was drawn up by the assembled Plenipotentiaries, and agreed to by them, and it was understood by the Porto, it being then the month of November, that as soon as the season would allow of it, engineers should be sent to stake out the ground, and settle once and for all what was the frontier line of the province of Montenegro as separated from Bosnia. At one moment, as the noble Earl has stated, the solution of the question promised considerable difficulty, but the Government thought it was their duty to resist any encroachments over the rights of the Ottoman Porto as they had been publicly acknowledged by the Conference of Paris; they thought it was a duty they owed to humanity to prevent, if possible, a repetition of those reckless and horrible scenes of plunder and insurrection which were described as constantly taking place, owing to the feuds of these mountaineers. And certainly, I think, we have a right to expect that what we have done will be attended with advantage and success. He need not add any observations to those that bad fallen from the noble Earl opposite, for he himself, who had signed the Treaty of Paris, could not be more anxious than were Her Majesty's Government to maintain all its provisions inviolate and valid, not only because it was a matter of international good conduct and of diplomatic faith, but because it was essentially for the benefit of Europe that the balance of power should be fully and fairly maintained, as connected with the integrity of the Turkish empire. With respect to the intrigues adverted to by the noble Earl he regretted them as much as he did. He could only say that Her Majesty's Government looked upon all these great international questions not as poets but as politicians, and that the cry about nationalities and other epithets of that kind, which were only used to excite the imagination or mislead the mind, but which had no foundation in real political economy or wisdom, were as entirely foreign to the policy of Her Majesty's Government as they would be to the mind of the noble Earl himself. He considered that the integrity of the Ottoman empire was important to the welfare of Europe, to the preservation of peace, and the prevention of prospective disturbance and wars, and that it constituted an essential part in the great European system that had prevailed since the Peace of Paris and the Treaty of Vienna.
LORD STANLEY OF ALDERLEYsuggested that it, would be very desirable that a portion of the correspondence should be laid upon the table, which would show the grounds upon which the delegate from Montenegro had been appointed, the exact part taken by this country in the affair, and the reasons for the abandonment by Prance and Russia of the pretensions which they had originally set up.
THE EARL OF MALMESBURYsaid, that if the noble Lord would give notice of his intention to move for the papers referred to, he would consider what answer he should give to the proposition. At the same time he thought the noble Lord must see that after a question in dispute, which had involved a great deal of discussion and something more, had been amicably settled it would hardly be desirable to make those discussions public. But if the noble Lord doubted the character in which the delegate from Montenegro was present with the Commissioners, or the part which he had played, he could only assure the noble Lord that in the procès-verbal which was signed at Constantinople the delegate's name was not to be found, and that he was only there to signify the acquiescence of the Prince of Montenegro in what was done.
LORD STANLEY OF ALDERLEYwould not press for papers if the noble Earl thought that it would be detrimental to the public service to produce them; still he thought that portions of the correspondence might be laid upon the table without inconvenience, which would show the exact part which this country had taken in the transaction.
House adjourned at Seven o'clock, till to-morrow, half-past Ten o'clock.