Sitting of 13 May 1858

MINUTES.
NEW WRIT—for the City of Limerick, v. George Gavin, esquire, void Election.
PUBLIC BILLS.—1° Prince Edward Island Loan; Common Law Procedure Act Amendment.
2° Joint Stock Banking Companies; Consolidated Fund (£11,000,000); Stamp Duty on Passports.

ROMAN CATHOLIC MAGISTRATES IN BELFAST.—QUESTION
MR. DEASYsaid, he wished to ask the Chief Secretary for Ireland whether it is the intention of the Irish Government to carry into effect that portion of the Report of the Belfast Commissioners in which they recommend that some Roman Catholics
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should be appointed magistrates for the borough of Belfast?
Lord NAASsaid, the hon. and learned Member was in error in supposing that the magistrates who sat in Petty Sessions at Belfast were magistrates for the borough. They were, in fact, magistrates for the county, and were appointed upon the recommendation of the Marquess of Donegal, the Lord Lieutenant.

REINFORCEMENTS FOR THE INDIAN ARMY.—QUESTION.
MR. WYLDsaid, he wished to ask the Secretary of the Board of Control if despatches have been recently received from Sir Colin Campbell asking urgently for immediate reinforcements? If the Court of Directors of the East India Company have declined for the present to provide transports for the troops which the military authorities have reported to be ready for embarkation?
Mr. BAILLIEsaid, he thought the hon. Member must perceive that such questions as those he now put were likely to cause much inconvenience. In the present instance, however, he should not decline to answer the questions put to him. He had to state that no despatches had been received from Sir Colin Campbell asking for immediate reinforcements, nor consequently had there been any refusal on the part of the Court of Directors to furnish transport for any troops that had been required.
MR. WYLDsaid, he would repeat his question in another form.

RESIGNATION OF LORD ELLENBOROUGH.—QUESTION.
LORD AD OLPHUS VANE-TEMPESTsaid, he would beg to ask the Chancellor of the Exchequer, whether the resignation of the Earl of Ellenborough has been his own spontaneous act, or whether it is partly attributable to the directly or indirectly expressed wish of the Government that the noble Lord should resign; whether it is the intention of the Government to adopt the views conveyed in the despatch of the Secret Committee to the Governor General in Council, April 19, 1858, or whether it is the intention of the Government to accept the policy laid down in the Proclamation of the Governor General of India, dated Allahabad, March 14, 1858?
THE CHANCELLOR OF THE EXCHEQUER: Sir, I will reply first to the second question that has been put to me by the noble Lord. I think, upon reflection, he

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must feel, and the House will agree with me, that the inquiry contained in his second question is one of too great a scope to form the subject of a mere question, but should rather be introduced to the House in the shape of a Motion. It is quite competent for the noble Lord to adopt that course if he wishes to obtain the fullest information upon the subject. With regard to the first question which he has put, I think the noble Lord will find the most authentic account of the motives that influenced the Earl of Ellenborough in the course of conduct which he has adopted, and the circumstances under which he adopted it, in the frank and generous speech which that noble Earl has recently delivered in his place in Parliament. I think if the noble Lord refers to that speech he will find that even the first Minsiter of the Crown was not aware of that resignation having been tendered until after it had been laid at the feet of Her Majesty, and I have no doubt that the motives which induced the Earl of Ellenborough to take that, not unconstitutional, but unusual course, were that he knew very well that if the question had been put to those who had the honour of being his colleagues, their great regard for the personal qualities of the noble Earl, and their admiration of his character, would have induced them unanimously to request him to withdraw his resignation.

THE OUDE PROCLAMATION.

  QUESTION.
  MR. NEWDEGATEsaid, he rose to put a question to the right hon. Gentleman the Member for Northampton, which he hoped the House would permit him to preface with a few explanatory observations. ["Order, order!"]
  MR. SPEAKERsaid, that the hon. Member must confine himself to putting the question.
  MR. NEWDEGATE: He rested his question on the facts that had been elicited in debate elsewhere—["Order, order!"]—and he thought the House would need no further reason for his putting the question. [Cries of "Question."] His question stood in these terms:—To ask the right hon. Member for Northampton, whether the late Government received any intimation of Lord Canning's intention to issue such a Proclamation as that addressed to the chiefs and inhabitants of Oude, which is now before Parliament, or that Proclamation? Whether the late Govern
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  ment were consulted by Lord Canning as to the policy of issuing such a Proclamation, or of any measure for the same purpose? And, if the late Government were thus informed or consulted, at what period their attention was first called to the subject, and what the dates and nature of the communications between the late Government and the Government of India thereon?
  MR. VERNON SMITH: I shall be very happy, Sir, to answer the questions of the hon. Gentleman if the House will indulge me in making an explanation of the circumstances to which the hon. Gentleman has alluded; but if that be contrary to the regular proceedings of the House, I will postpone giving an answer until the Motion for adjournment. [Cries of" Go on, go on!"] Well, then, with the permission of the House, I will give give an explanation of all the facts. The question of the hon. Gentleman, so far as it relates to myself, I can answer, but as to the late Government I cannot answer for what information any of my colleagues may have received upon this subject. My answer is this—that I received a private letter, dated the 6th of March, from Lord Canning, the nature of which I will communicate to the House presently. There arc three modes of communication between the Governor General and the Board of Control—through the Court of Directors, which is public and official; through the Secret Committee; or by private letter, which is, of course, the most confidential manner. Now, Sir, I am perfectly prepared to admit, in its fullest sense, that every ex-Minister, and indeed, every man who hears anything either advantageous or detrimental to the public service, is bound to communicate that information to the Minister of the day; but With this reservation, that in doing so lie ought not to say anything which may betray unnecessarily the confidence of private communications. That is the limit which I set between communications of ex-Ministers and their successors. My first act, after leaving office, was to communicate to Lord Ellenborough a private letter from Lord Elphinstone, which the noble Earl returned to me, without inviting any further communication. With regard to Lord Canning, the case is somewhat different. Lord Canning was my public colleague and my private friend, and his letters were mere familiar. more confidential and intimate, than those of other Governors. I therefore did not

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  send Lord Canning's private letters to Lord Ellenborough; but in perusing them I watched carefully to see if they contained anything that could possibly make them of such a nature as to require me to communicate it to the existing Government. Now, the particular communication which has been alluded to in "another place," and to which, I think, undue importance has been attached, as I shall show presently, was dated March 6. It arrived when I was absent in Ireland; but I do not dwell upon that circumstance, because undoubtedly that was not the reason, except as it added to its insignificance, why it was not communicated to the noble Earl at the head of the Board of Control. That private letter, referring to many circumstances, stated—
  "That the Governor General intended to issue a Proclamation to the talookdars and landowners of Oude which would reach me officially by this Mail. He had hoped to have accompanied it with a full explanatory Despatch, but more urgent business has prevented him from doing so from hour to hour and from day to day."
  That letter did not contain any copy of the Proclamation itself, nor any explanation respecting it, or I would certainly have forwarded the Proclamation or the explanation to the Government; but as it stood, I confess it appeared to me at the time, and still appears to me, that the letter was not of such importance that I should communicate it to the Government. [Laughter.] If any hon. Gentleman thinks it was of such importance, will he tell me what communication I ought to have made to Lord Ellenborough? Was I to tell him I had heard privately that he had received a despatch publicly? I suppose there was no necessity for my doing that. Was I to say that Lord Canning had written to me that he intended to send a despatch which he never had sent, and which, for all I knew, he might never send? That would, also, have been a work of supererogation. I think such a communication to Lord Ellenborough would have been, not only useless, but impertinent, and certainly Lord Ellenborough is the last man to whom I should wish to make an impertinent communication. Why do I say so? Because I could only have said to him, "You have received a public despatch, giving you a Proclamation about to be issued in Oude; but such is my sense of your intemperance and rashness that—("Oh! oh!")—I am stating now what would have been the interpretation put upon such a communication. I should
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  have added, "I conceive you are about to act on that Proclamation without any sort of explanation." I think if I had gone to Lord Ellenborough and made such a statement he would justly have pronounced it an impertinent communication; and so undoubtedly it would have been, because Lord Ellenborough knows as well as I do, and perhaps better than I do, that the constant habit of communication from India is this—to send home narratives, and afterwards—sometimes long afterwards—to forward an explanation of the reasons for such narratives. And why is this? Why, because the Governor General communicates with the Home Government in perfect confidence that his acts will be viewed with judgment, caution, and consideration, and therefore he frequently sends them without any species of explanation about them. This must have been perfectly well known to Lord Ellenborough. It was also known to him that another medium of communication with the Governor General is this—that he communicates to the Chairman of the Court of Directors at the same time that he does to the President of the Board of Control any facts of importance; and therefore I had some right to assume that a similar statement was also communicated by Lord Canning to the Chairman of the East India Company, with whom the noble Lord (the Earl of Ellenborough) was in constant communication. I contend, therefore—looking at this letter, and seeing how little was the importance to be attached to it—that I was perfectly justified in not sending the letter to Lord Ellenborough. I may state, however, that I read it to my noble Friend the Member for Tiverton (Viscount Palmerston), to whom it did not appear, any more than to myself, that it was necessary to communicate it to the Government. I am perfectly prepared to justify my not having made that communication, and I have not the slightest feeling of regret for not having done so. I believe that I was perfectly correct in the course I took—that what was told me in that private letter was of no sort of importance, and I defy any man to show how in any way it could have affected the decision of the Government in any one thing; and, if it could have affected their decision, I can only express my wonder that before acting they did not inquire in every quarter whether any communication had been received.
  SIR WALTER FARQUHARsaid, he

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  wished to ask the right hon. Gentleman whether Lord Canning would not write the letter in question under the impression that the right hon. Gentleman (Mr. Vernon Smith) was President of the Board of Control, and that, as a matter of course, he would receive the draught of the Proclamation and the letter by the same mail?
  MR. VERNON SMITH: Of course.

  OATHS BILL.
  LORD JOHN RUSSELLbrought up the Report of the Select Committee appointed to draw up the reasons assigned for disagreeing from the Lords' Amendments of this Bill.
  The reasons were read by the clerk at the table as follows, and agreed to seriatim:—
  "1. Because the words 'on the true faith of a Christian,' were originally introduced in the Oaths to be taken by Members of Parliament with a view to bind certain Roman Catholics, and were not intended for the purpose of excluding persons of the Jewish persuasion.
  "2. Because the exclusion of British subjects from seats in Parliament and offices in the State on the ground or their religions opinions is contrary to the general maxims of freedom of conscience.
  "3. Because no charge of disloyalty or unfitness for public employment and a fair share of legislative power has been alleged, or can be alleged, against the Jewish community.
  "4. Because the infliction of disabilities upon any class of Her Majesty's subjects solely en the ground of their conscientious adherence to their faith savours of persecution, and is totally inconsistent with those principles of religious liberty which, in the case of more powerful communities, have been applied by Parliament with such happy effects.
  "5. Because the Commons having already on ten previous occasions, and in five Parliaments, passed Bills for removing the civil disabilities of the Jews, and having of late years agreed to such Bills by constantly increasing majorities, are convinced that the opinion of their constituents and of the country at large has been irrevocably pronounced in favour of the removal of such disabilities.
  "6. Because such Bills have been supported by many of the most eminent Members of both Houses of Parliament, who, while differing upon other political questions, have concurred in the justice and expediency of measures for the relief of the Jews.
  "7. Because the rights of the electors of the United Kingdom have been peculiarly affected by a law which has been construed to prevent the admission to the House of Commons of persons who have been lawfully returned as Members of that House.
  "8. Because the first and third clauses of the Bill air open to the construction that the new Oath which the former of them contains should be taken not only in all cases where the Oaths of Al-
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  legiance, Supremacy, and Abjuration, are now required, but also where the Oaths of Allegiance and Supremacy are at present required, though without the Oath of Abjuration; the result of which construction, if the Bill should pass into law without the fifth clause, would be to exclude the Jews from practising as solicitors and barristers, and from offices under the Crown, to which employments and offices they are now admitted.
  "9. Because such result would be contrary to the intention of the two Houses of Parliament, appearing from the sixth clause and from the title of the Bill under consideration."
  MR. NEWDEGATEsaid, he wished it to be understood that if he did not now object to the substance of these "reasons," it was in deference to the opinion expressed by that House when they determined upon a conference with the House of Lords. On the main question in issue, he still retained in its integrity the opinion he had already expressed; and if he now abstained front interrupting the course of the proceedings before the House, it was solely out of deference to the feelings of the majority.
  LORD JOHN RUSSELLsaid, that he would then move that a conference be desired with the House of Lords.
  Ordered,—
  That a Conference be desired with the Lords upon the subject matter of the Amendments made by their Lordships to the said Bill; and that the Clerk do go to the Lords, and desire the said Conference.

  THE OUDE PROCLAMATION.—NOTICE.
  THE CHANCELLOR OF WE EXCHEQUERsaid, it would be convenient if the right hon. Gentleman the Member for the City of Oxford would state in what form he meant to bring forward his Motion to-morrow—whether as an Amendment on the Motion for going into Committee of Supply, or as a substantive Motion, because in the latter case he (the Chancellor of the Exchequer) should have to move that it take precedence of the Orders of the day,
  MR. CARDWELLsaid, he felt indebted to the right hon. Gentleman for affording him the opportunity of bringing on his Motion before the Orders of the Day. It was as a substantive Motion that he meant to introduce it, and it stood in the Order Book in that shape.
  MR. MILNER GIBSON: Is the Motion to be made in the same words in which it stands there?
  MR. CARDWELL: Exactly the same.
  THE CHANCELLOR OF THE EXCHEQUERsaid, he would now give notice that to-morrow he should move that the notice of Motion of the right hon. Gentleman (Mr.

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  Cardwell) should take precedence of the Orders of the Day.,

MASTERS AND WORKMEN BILL.

  SECOND READING.
  Order for Second Reading read.
  Motion made, and Question proposed, "That the Bill he now read a second time."
  MR. WALPOLEsaid, that he must appeal to the hon. Member for Rye (Mr. Mackinnon) as to the desirableness of going on with the measure. The object of the Bill was unquestionably good—namely, to provide a means for arranging the differences between masters and workmen by arbitration. By the law, however, as it stood at present, when masters and workmen had a dispute, they could, if they were agreed upon that point, refer that dispute to two justices. Masters and workmen, however, had an unwillingness to put that law into operation, and the law as it stood at present was therefore inoperative. The object of his hon. Friend's Bill was to obtain an operative law to effect the same object which was contemplated by the Act of George IV., but which for the reason he had stated was inoperative. The machinery by which the hon. Member proposed to carry out the objects of the Bill was so unworkable that he hoped he would not persist in pressing it upon the House. The Courts of Conciliation proposed by the Bill were to be chosen by masters and workmen, and he asked the attention of the House to the nature of the constituencies thus created. Every person being an inhabitant householder, employing workmen, within a circuit of five miles from the place where the Council of Conciliation was to hold its meetings, was to be entitled to vote at the election of masters, and every workman residing with in a circuit of five miles for twelve months was entitled to vote at the election of workmen. These were the constituencies by whom an equal number of masters and men were to be elected; and on the day of election the votes were to be taken by a show of hands, from which there was to be no appeal. Now, he asked the hon. Member whether it would be possible with such constituencies, and with such a mode of election, to elect a Council of Conciliation that would give satisfaction to anybody? The whole machinery of the Bill was unworkable, and therefore he hoped that his hon. Friend would see the propriety of
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  withdrawing it altogether, as there seemed to be no possibility of so altering it in Committee as to insure for it the favour of the House.
  MR. MACKINNON(who was very indistinctly heard), was understood to say that he thought that as the right hon. Gentleman admitted the object of the Bill to be a good one, he might have allowed it to be read a second time, and proposed such alterations as he saw necessary in Committee. The object of the Bill was regarded with deep interest by thousands of workmen both in London and throughout the country, including all the great towns of Lancashire.
  MR. LABOUCHEREsaid, he had great respect for the intention of his hon. Friend and the perseverance with which he had endeavoured to benefit the working classes, but still there was no subject more delicate and none with regard to which the House should take more care in dealing than the relations between master and workman. He concurred in the opinion given by the right hon. Gentleman (Mr. Walpole), that the machinery of the Bill was altogether unworkable. Only imagine a meeting of the inhabitants of a district within a certain radius, in which by a show of hands a Council was to be appointed. It was impossible that such a tribunal could satisfactorily deal with such a delicate question. No man was more anxious than himself to see a good understanding exist between masters and workmen, but he was not so sanguine as some others seemed to be that this end would be promoted by Councils of Conciliation. He would rather see masters and workmen settling their differences by friendly intercourse and the freest discussion among themselves. He hoped his hon. Friend would see the propriety of the course recommended by the right hon. Gentleman, and withdraw the Bill.
  MR. HENLEYsaid, there was only one point to which he wished to call the attention of his hon. Friend opposite. He agreed with his right hon. Friend the Home Secretary in believing that the Bill with its present machinery, or anything like it, could not work. Now, if the Bill was negatived, the hon. Gentleman would not be able to introduce another on the subject this Session; but, if he withdrew it, he might, if it was put into better shape, reintroduce it this year. It was a great question whether the evidence of competent persons, skilled in the matter and

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  given on oath, might not enable a magistrate to come to a sound decision in ease of disputes. He doubted very much, however, whether the common sense of masters and workmen would not enable them to settle the differences between them as well as by any machinery for selecting half-a-dozen on one side and half-a-dozen on the other.
  MR. INGHAM, although he joined in the request to his hon. Friend to withdraw the Bill, yet did not think sufficient reasons had been given for the second reading being opposed. When the Bill was brought in, the Home Secretary admitted that the existing law on the subject of masters and workmen required amendment, and that he would support any measure that had that amendment for its object. It was said by the right hon. Member for Taunton (Mr. Labouchere) that there was a great increase in the intelligence and moderation of the working classes, and no doubt that was so; and it only wanted that masters and workmen should be brought together in order to put an end to differences between them; and that would be effected by means of Councils of Conciliation. One thing was most valuable in this Bill, and that was, that it proposed to establish a permanent body to deal with disputes between masters and workmen. The reason why the present Act was inoperative, was, that you could not call upon the magistrate to appoint arbitrators until after the dispute arose. It was then difficult to get an arbitrator sufficiently impartial to decide. If the President of the Board of Trade would give an intimation that he would take into consideration whether some permanent tribunal might not be established to which disputes might be referred, then his hon. Friend might congratulate himself on having done some good for the object he had so long at heart.
  MR. TURNER, said, that as a pretty large employer of labour, he objected entirely to the Bill, not more on the part of the employers than of the employed. The Bill was, no doubt, prompted by kindly feeling on the part of the hon. Member; but if carried out, it would, in the result, be like interfering between man and wife, and would utterly fail. A growing spirit of conciliation and kindly feeling between masters and men had been for many years springing up, which would only be interrupted by legislation such n, this. As had been shown by the right hon. Gentleman the Secretary for the
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  Home Department, there were great objections to this measure. Every man who was employed might claim to act as one of the employed; and so every man who employed any one else—a tinker, for example, who had a man to help him—might claim to vote as an employer. Many of these employers would be mere workpeople themselves. Much mischief would, he was sure, be produced by such a scheme.
  MR. KIRKsaid, he also felt that the Bill, so far from being for the benefit of the workmen, would be injurious to them, and would produce the worst feeling between them and their employers, whereas at present a very good feeling prevailed. In Ireland, in disputes connected with work which was given out, if a workman complained to a magistrate, the party complaining appointed one arbitrator, the master appointed another, and the magistrate a third; and on their report the magistrate issued his order. The present Bill, he thought, would be especially injurious to the working classes themselves, and he would therefore decidedly oppose its second reading.
  MR. MACKINNONsaid, he could but express his willingness, after what had passed, to withdraw his Bill.
  Motion, by leave, withdrawn.
  Order for Second Reading discharged.
  Bill withdrawn.

JOINT-STOCK BANKING COMPANIES BILL.

  SECOND READING.
  Order for Second Reading read.
  Motion made, and Question proposed, "That the Bill be now read a Second Time."
  MR. BLACKsaid, that the principle of limited liability might be advantageous in many kinds of trade; and yet in banking, which stood on quite a different footing, it might be most dangerous. In banking, as was well known, it often happened that persons unacquainted with the principles of business came into the possession of property, and were obliged to look out for some bank in which to deposit it. In ordinary departments of trade persons carried on business with their own capital; but bankers carried on their business with other people's capital for their own benefit. If an insolvency happened in ordinary kinds of trade, the injury and ruin were generally circumscribed in their extent; but in banking the ruin spread much wider. Those who took on themselves to establish a bank

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  took on themselves a great responsibility, and the public had an interest in seeing that those who took on themselves that responsibility gave the largest security for the public safety. In the case of a bank to which allusion had often been made (the Western Bank of Scotland), it had been said, and said truly, that although the bank failed, the depositors and holders of notes would not suffer, because the proprietors were quite able to pay all the debts in full. He fully approved of the meeting which had taken place, recommending persons to take the bank's notes in payment, notwithstanding the failure; for the consequence was that the panic was greatly allayed. There the unlimited liability was their sheet anchor. If the liability had been limited the panic would have spread, and the whole country would have been involved in one general ruin. It was said that, if they had limited liability, they would not have panics; but in his opinion, there would, on the contrary, be much greater danger of panics; for if a man had money in a limited bank, and money also in a bank of unlimited liability, and a panic were to occur, assuredly he would run first to the limited bank to get his money. In this he was confirmed by Mr. M'Culloch, who said—
  "The tendency to panics is one of the peculiarities of American society, owing to the liability of partnership in banks being limited. The depositors and the holders of notes take all imaginable pains, when suspicion is awakened, to withdraw their deposits and to cash the notes. Hence repeatedly panics occur throughout the Union, and the slowness with which they arc disseminated in this country arises from the contrary circumstance, namely, the confidence of the public in the unlimited liability of the partners to make good all demands."
  It had been said that it was very hard that the shareholders should suffer, but according to every principle of honesty he thought that, when one man took an-other's money into his keeping, he was bound to pay him back so long as he had anything to pay with. In the Western Bank of Scotland there were 1,300 shareholders. Some suffered very considerably. A few were ruined, but the great bulk by retrenchment were able to recover themselves. If, however, the loss had fallen upon the depositors, small as the sum might have been individually, the majority would have lost their all. Speculation had been of late years a great deal too rampant, and there was no reason why it should be encouraged. Besides, it might be asked, were they prepared to apply limited liability
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  to everything? Would they allow it to a pawnbroker? Let them suppose the case of a poor man losing his money in one of these banks, money which he had been frugally gathering up in order that he might have something in a time of sickness, or to provide for his widow. After his money was lost, he might see the banker who had received it lolling, perhaps, in his carriage, and he would be told that the bank was on the system of limited liability, and, therefore, the banker was not bound to pay. Upon the ground, then, that the Bill was a violation of that great moral principle, that every man was responsible for his actions, and was bound to pay his debts to the last farthing, he (Mr. Black) should move that the second reading be taken that day six months.
  Amendment proposed, to leave out the word "now," and at the end of the Question to add the words "upon this day six months."
  MR. FINLAYseconded the Amendment. He had given much attention to this subject for several years, and he was sorry to say he had not been able to come to the same conclusions as the proposers of the present measure. It appeared to him that the principle of limited liability was essentially unsound. It certainly was not founded on the principle of free trade, but on that of protection, for it protected the shareholders against their creditors. They had been told that limited liability would be the means of attracting the capital of the wealthy, and would give security to the poor man, and open up several new sources of profit. In fact, they were told it was to be a great panacea for all our banking, as well as for the whole of our commercial system, but no proof had teen given that any such result had occurred. The principle of the Bill was totally unsound; but if there was any advantage to the country in this privilege of not paying debts in full, why should it be confined to associations? Why should it not be equally applicable to individuals? The truth was, that the adoption of the principle of limited liability had failed to produce those good effects which were predicted of it when it was first introduced; and that, he thought, was quite reason enough why the House should hesitate before it extended time principle, as this Bill proposed to do, to joint-stock banks.
  MR. DRUMMONDsaid, that he fully concurred in time observations of the hon. Gentleman who had just sat down, and he

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  would illustrate them by saying that, if his hon. Friend opposite and himself individually ran into debt, they would be obliged to pay their debts; but the effect of this Bill would be, that if they went into partnership they would not in that case be obliged to pay their joint debts. He wished to call the attention of the House to the deception which was practised by a class of banks called banks of deposit. He held in his hand several advertisements emanating from those establishments promising to pay a high rate of interest on deposits—6 or 7 per cent, at the same time giving ample security. Now, the effect of that must be enormously to increase the trade in paper. They used to have panics every ten years, now they had them every six or seven. There was no way in which the high interest on deposits to which he had referred could be paid, but by flying kites. And this Bill was nothing but a measure for establishing unlimited paper circulation.
  SIR ROBERT CARDENsaid, he objected to the present Bill, because it would inflict a great injustice upon existing banks. Previous to the passing of Sir Robert Peel's Act the capital of banks might be divided into shares of any amount, while there was no limit as to the amount required to be paid up. By that Act, how. ever, the shares were to be of not less than £100, while £50 was to be paid up before commencing business. Then, by the present Bill both description of banks were to be placed on the same footing. The result would be that if this measure for creating limited liability were passed, the banks established under the old system (and upon the shares in which not more than 10 or 20 per cent was paid) would be able to call up four or five times as much as the now banks, half of whose capital was already paid up. This would practically give the former a great advantage over the latter. He thought a new system in banking should be established. There had latterly sprung up what were called "discount banks," which for all purposes were banks, while as they did not technically come within the operation of Peel's Act, they were, therefore, able to carry on business with not more than 30 or 40 per cent of their capital paid up. He hoped that a measure would be introduced applying the same law to all classes of banks.
  SIR WILLIAM DUNBARsaid, if it was fair to allow limited liability in any trade or business, he could not conceive
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  any reason why the business of banking should form the only exception. The object of the Bill was to extend to banks the same privileges and facilities which were allowed other companies. It did not interfere with the system of unlimited liability, or with the liabilities of partners in existing banks, but simply proposed to remove the impediments which now existed to the establishment of co-partnerships with limited liability, for the purposes of banking, thus bringing banking within the operation of the general law. For his own part, he believed that one of the results of the change would be to induce many persons of respectability and prudence who feared the consequences of unlimited liability, to become shareholders, thus introducing a class from whom a better and more responsible direction might be selected. If there were proper, full, and detailed accounts, and a perfect system of audit, there would be faith in the bank. If the Western Bank had been a bank with limited liability, its management could not have been worse, and, in all probability, it would have been better. In any event its failure, instead of being as now, ft national calamity, would have been comparatively harmless. In saying this, it was far from his intention to say that limited liability would ensure unexceptionable management, but the management would be as good as under the present system, while the consequence would be less serious than now. But admitting that there were evils connected with limited liability, were there no evils connected with unlimited liability? To his mind there were many. As the law at present stood, unlimited responsibility, especially when combined with a power of issue, was synonymous with monopoly, especially in country districts, and it was not surprising that persons who reaped the profits of monopoly should support its continuance, instead of teaching people to trust to themselves and to look after the management. Unlimited liability taught nom to trust entirely to others and to rely on the ultimate claim on the shareholders—a reliance that often proved deceptive and illusory. The consequence was, that unlimited liability tended to divert capital from its legitimate channel, and to accumulate enormous amounts of money in the hands of a few institutions, which in many cases employed it in wild speculation, and in bolstering up fictitious traders, to the damage of the fair trader. One provision of the Bill, imposing certain

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  conditions on banks of issue, required attentive reconsideration. If those banks could not avail themselves of the measure without losing their statutory privileges, much of the benefit that would otherwise be conferred on the public would be forfeited. He admitted that there was a distinction between a noteholder and a depositor. The noteholder was an involuntary creditor, while the depositor was a creditor from choice. But could no protection be found for the noteholder, except by depriving existing banks of issue of their privileges? It appeared to him that every protection to the noteholder might be found in simply requiring banks of issue, like the Bank of England—which was a bank with limited liability—to give security, either landed or funded, or to have gold in their coffers for the amount of notes issued. In the Isle of Man, where there was a single bank of issue called the Bank of Mona, the notes were secured by mortgages on land, and why should not the same system be adopted here? For twenty years monied men in the city had been in the habit on all suitable occasions of endeavouring to win public opinion to their views, that note issues should be suppressed, by putting forth most exaggerated statements concerning them. When they looked at the returns of the note circulation, it was wonderful to see how steady that circulation was, and yet they found respectable men from time to time speaking of over issue, and attributing to it reckless trading, and consequent money panics. In his opinion, the true cause of one of those evils—reckless trading was to be found in the eager desire to get rich, which had become one of our national failings. He thought it was no part of the duty of that House by exceptional legislation to attempt to give prudence to the rich, experience to the inexperienced, and honesty to the unprincipled; nor was it within its province to attempt to dictate to men upon what terms they should deal with each other. He hoped that his hon. and learned Friend the Member for Newcastle would, when the Bill was in Committee, endeavour to obviate the difficulties to which he had referred.
  MR. BOVILLsaid, he was surprised to hear the hon. Gentleman who spoke last repudiate the right of that House to interfere for the regulation of joint-stock banks. An able Committee which sat in 1846 on this subject asserted the necessity for such interference on public grounds, and with a view to guard the community against wide-
  540
  spread ruin and destruction. If it was difficult for the shareholders of a joint-stock bank to understand how its affairs were managed, and what was its financial position, how was the unhappy customer of such a bank to obtain this knowledge, as the advocates of limited liability expected him to do? They had no control over the management, and without any default of their own, they might find themselves overwhelmed in ruin. This Bill was, in truth, nothing more nor less than an attempt to protect directors and shareholders at the expense of the public interest. All the objects with which banks were established would be better attained by unlimited than by limited liability. The first object was to secure au accumulation of capital, which should be diverted from its ordinary channels, and of which the surplus should be applied to commercial undertakings. How much more likely to effect this object banks with unlimited liability were than banks established on the opposite principle was assuredly proved by the argument of the promoters of this Bill—that so much capital was accumulated by existing banks as to encourage speculation. There was then no complaint of a want of accumulation under the present system of joint-stock banks or its appropriation by their means. The second object was to afford security to the bank and to persons trading with it. It was to give additional security that joint-stock banks were originally established; and how well this object had been attained had been shown by the fact that in the failures which had taken place in the north of England, in not more than two instances had the creditors received less than the full amount due to them, and in those cases the deficiency was only one of 2s. or 3s. in the pound. Another great object was to secure good management, and how was it likely that banks could be as well managed by men who had only a limited liability as by those who were responsible to their last farthing? In support of this Bill it was urged that the Legislature had decided that limited liability should be the rule in commercial undertakings; but the same Parliament decided that that principle should not extend to banks, and as far as our experience went, the adoption of the principle of limited liability had not been attended with favourable results. On the contrary, in the cases which had come into the courts it had generally appeared that all the money which had been paid up was spent,

  541
  and that there was nothing for the creditors. The promoters of this Bill said that unlimited liability prevented respectable and responsible persons from joining banks. This argument was sufficiently answered by the published lists of directors and shareholders of joint-stock banks, and would probably receive a still further refutation by directors of such banks rising to address the House upon this question. But, even if the argument were a sound one, of what advantage was a man's responsibility and repectability under a system of limited liability? All that you wanted under such a system was his money. Another argument was, that, although unlimited liability might not prevent respectable men joining a bank, yet that it induced them to retire as soon as they got an inkling that it was falling into difficulties. To this he replied, that they could not relieve themselves of responsibility for three years, and that if it was found that all the responsible men were retiring, the bank was sure to fall within that period, and thus the creditors were recouped. Another objection which had been urged against the present system was, that banks obtained too much money, which led to reckless and extravagant speculation. Now, he had always thought that banks were established for the express purpose of accumulating the money of the public, and using it in commercial operations. What, however, was the remedy for over accumulation of money? It was to put a limit to the amount which a bank might raise by crediting a proportion between its borrowing powers and its capital. The Bill before the House contained no such provision, and in that respect, therefore, it was not calculated to accomplish the object of its promoters. But the present law of limited liability, it was said, encouraged reckless trading. Now, there could be no doubt that it was competition which produced wild and extravagant speculation, and he maintained that banks with limited liability were far more likely than banks with unlimited liability to excite excessive competition. Mr. Gurney, when examined before the Committee of 1836, stated that limited liability applied to banks would give us all the evils of both systems, and none of the advantages of either; while Mr. Martin, of Norwich, declared that no public advantage or security could be derived from limited responsibility, which would have the effect, he added, of making bank managers more reckless and adven-
  542
  turous. The report of 1843 contained a valuable paper from the present Lord Overstone, in which that great authority stated that the commandite principle entailed something very nearly approaching to injustice, inasmuch as in case of insolvency it tended to remove a portion of the loss from those who had voluntarily engaged in the concern, who had possessed the means of watching its progress, and who had been the sole participators in its benefits, for the purpose of putting it upon those who had enjoyed no opportunity of looking into the affairs of the establishment, who had taken no part in its management, and who had not been allowed to share in its advantages. It was after repeated inquiries by Committees of the ablest men in that House that the Legislature, in its wisdom, expressly declared in 1856–7 that limited liability should not exist in the case of joint-stock banks. But the House were asked to believe that banks should be legislated for, on the same principle as other trading concerns. The case of a bank, however, was clearly exceptional. When an ordinary concern failed, the loss was confined to the directors and shareholders; but it was impossible to say how far the liabilities and engagements of a bank might extend, and in the event of failure, instead of the loss falling upon a limited number of persons, it entailed wholesale ruin, and might fitly be termed a national calamity. Banks with limited liability, as had been remarked, were established in the Colonies. But in the Colonies the object was to attract money, and force it into commercial channels; whereas the complaint at home was, that the banks obtained too much money, the consequence being reckless speculation. He had stated the grounds that had been put forward on behalf of the present Bill, but after all, the true explanation was to be found in the misfortunes that had recently fallen upon the managers and proprietors of banks. The question was between the directors and shareholders of banks on the one hand, and the public on the other. Now, the directors and shareholders had the lion's share of the profits, and he held that in the event of a failure the loss should fall exclusively upon them, and not upon those who trusted them. If the managers and proprietors of a bank chose to deal with the money of other people, were not the latter entitled to look to them for payment of the utmost farthing? Depositors received no benefit from the

  543
  profits of a bank, nor had they any means of controlling its operations. The misfortunes of a bank arose from mismanagement, and mismanagement was attributable in the first instance to the directors, and in the next to the shareholders who elected them. No balance-sheet could ever tell the public what was the value of securities lodged with a bank, and lie contended, therefore, that on the grounds of management, of superior knowledge, and of profit, the directors and shareholders and not the public, ought to be made responsible for any loss that might be incurred. But after all, did it not lie on those who promoted the measure to make out a case for its necessity? From the beginning to the end of the discussion he had not heard the slightest ground stated to show the necessity of the measure, unless it was desired to relieve the directors and shareholders of these joint-stock banks and to throw the loss on the innocent public who trusted the directors. In 1837, after the first Report of the Committee on joint-stock banks, it was stated in the Speech from the Throne that the best security against mismanagement of banking affairs must ever be found in the capacity and integrity of those who were intrusted with the administration of them, and in the caution and prudence of the public; but that no legislative regulation should be omitted which could increase and insure the stability of those establishments, on which commercial credit so much depended. The security of these establishments he maintained would be found in the security they offered for the payment of their debts, and in the accumulation of large sums of money to be devoted to the legitimate purposes for which banks were established.
  MR. J. H. GURNEYsaid, he would very briefly state his reasons for voting against the Bill. Those reasons were not based on any feeling as to the unsoundness of the principle of the Bill itself, because it appeared to him that if the principle of limited liability to trading companies were maintained the Legislature could not refuse to extend that principle ultimately to banking companies, though it was perfectly true that the position of trading and banking companies was not precisely identical, because, while trading companies borrowed money incidentally, banking companies borrowed it inherently, that being their business. Nevertheless, he thought that if the provisions of the Li-
  544
  mited Liability Act were applied to banking companies, so that all their cheques and passbooks would have stamped on them the word "limited," it would be impossible for persons doing business with them to be ignorant of the feet that the responsibility was limited. He therefore was of opinion that there was no sufficient distinction in principle between joint-stock banks and other trading companies to justify ultimately excluding the former from the adoption of limited liability, if limited liability should be at all maintained. Furthermore, supposing the system of limited liability to be extended to banking companies, and supposing, which was doubtful, that banking companies in general availed themselves of the privilege, this good effect would result, that, while the banking companies so limited would, if well managed, obtain sufficient credit for all legitimate purposes, they would be less able to obtain credit for improper purposes, and if once they went wrong, they would be wound up more quickly than at present. This was a reason for putting banking companies ultimately on the same footing as other companies; but another consideration prevented hint from supporting the Bill on the present occasion, and it was this—that the general experiment of limited liability did not appear to him to have been tried long enough to enable the House to judge whether it was a successful experiment or not. Until a proper experience of the system of limited liability had been obtained he thought it would be a great mistake to extend it, especially in so important a direction as banking companies. He should, therefore, on the present occasion, give his vote against the Bill; but, if he should have the honour of a seat in Parliament in future years, and were satisfied that the general experiment was successful, he, for one, should be quite willing to see it extended to banking companies.
  SIR GEORGE LEWISsaid, he must dissent from the assumption of the hon. and learned Gentleman (Mr. Bovill), to whose ability in treating this subject he bore willing testimony, that it was incumbent on those who supported the second reading of the Bill to show a case of necessity for the alteration of the law, and that the burden of proof lay, not on those who resisted the second reading, but on those who gave it their support. The Legislature of this country had enacted in respect to all trading associations, when certain

  545
  conditions were fulfilled, limited liability for the partners, and the issue raised by the hon. and learned Member for Newcastle-upon-Tyne (Mr. Headlam) was whether there existed sufficient ground for making a special exception in the case of banking companies. Therefore, it appeared to him that those who were in favour of making an exception were bound to show in the case of banking companies special circumstances which took them out of the rule applicable to all other trading associations. His hon. and learned Friend had obviated the objection which he (Sir G. C. Lewis) had made in former stages of the Bill, to the effect that he established no distinction between banks of issue and banks of deposit, and comprehended in the same rule the note-holder and the depositor, far in the draught of the Bill now before the House the hon. and learned Gentleman had excepted from its operation all banks which were banks of issue, unless they renounced the privilege of issue. The position of a holder of notes was very different from that of a depositor. In point of fact, he was as an hon. Baronet, who had addressed the House with great clearness, had observed, an involuntary creditor. In country districts the notes of the local bank passed from hand to hand without question; and any person who refused to take them would find his customers leave him. The note bolder was therefore in the position of an involuntary creditor, and as such he was entitled to a large measure of protection. That objection, however, being obviated, was there any reason why banks of deposit simply should be made an exception to the general rule? There was, no doubt, a difference between banks of deposit simply intended for the purpose of custody, which gave no interest on the deposits, and banks which allowed interest on the deposits. It might be argued that a bank which received money for the purpose of safe custody received it in the way of a fiduciary contract, and not in the way of loan; and that, therefore, banks of that character should not be considered as carrying on trade, and coming within the principle of limited liability. That was, perhaps, a refined distinction between deposits of that class and deposits bearing interest; but it the distinction were admitted to be valid, it hardly applied to the case the House had to consider, because the great majority of joint-stock banks, if not all, were in the habit of allowing interest, either on the
  546
  whole or some portions of the deposits. In the case of a bank allowing interest, it must be admitted that the deposit was in strict sense a loan to the bank, for which the depositor received an interest, and on which the bank traded. Under these circumstances it seemed to him that no valid distinction could be established between banks of deposit and other trading speculations with respect to the principle of limited liability; and therefore he should be prepared to give his vote in favour of the second reading of the Bill. But, having stated this, he would guard himself against the supposition that he thought either that the principle of limited liability would be introduced extensively by joint stock banks, or that it was desirable to give any artificial encouragement to the increase of joint-stock banks with the view of diminishing the number of private banks. With respect to the it was in the first place to be observed that it was merely permissive; and if it became law it would be quite open to any joint-stock bank either to adopt it or remain in the same position as heretofore. Was it probable tied many joint-stock banks would adopt the principle of limited liability? In considering this question, they must ask what was now the ground on which so much trust was given to joint-stock banks? Why was it their deposits were so large? Why was it that the operations of joint-stock banks, which were carried on upon so gigantic a scale, had, both in London and the provinces, assumed within the last few years quite a new character? He apprehended the answer was, that the public and the depositors trusted these banks on the ground of the unlimited liability of a large body of shareholders. The public had but slight means of knowing how these banks were managed; they could only ascertain what were the dividends paid; but undoubtedly what they mainly looked to was the unlimited liability of a numerous and wealthy proprietary. Now, if that security were limited,—if joint-stock banks were to say, "Instead of giving this unlimited advantage to depositors they shall have only a limited capital beyond which their security shall not extend," undoubtedly one of the strongest motives which now induce the public to repose confidence in joint-stock banks would be withdrawn. Was it likely, under such circumstances, that a joint-stock bank with limited liability could compete with other joint stock banks Whose liability was

  547
  unlimited? He believed that, unless directors and shareholders of joint-stock banks could be convinced that, after limiting their liability, they could carry on a successful competition with other banks, it was not probable this measure would be adopted in many cases. There could be no doubt, looking to the constitution of joint-stock banks, that, without a coincidence of circumstances which could seldom be expected, unless there was great honesty, vigilance, and knowledge of business on the part of the managers and the few directors who practically conducted the affairs of such banks, the interests of the shareholders were exposed to considerable risk. The great body of shareholders in joint-stock banks had, in fact, no knowledge whatever of their affairs; they were incapable, for the most part, of forming a clear judgment upon the annual or half-yearly statements which were submitted to them; and they were unable to estimate the value of the securities which were placed among the assets of the banks. If a shareholder, who entertained doubts as to the management or credit of a joint-stock bank, came forward at the annual meeting to put questions to the directors, his mouth would be immediately stopped by other shareholders, who would tell him he was taking a course Which was dangerous to the credit of the establishment, and most inimical to his own interests. There was, indeed, no person in a more helpless position than a shareholder in a joint-stock bank who suspected something wrong in its management; for, unless he could obtain information confidentially from the very persons of whose integrity or discretion he entertained doubts, it would be extremely difficult to establish any ground for a complaint. Generally speaking, very little discretion was exercised by shareholders in the choice of directors, and directors who were substituted for outgoing members of the board were, for the most part, proposed to the shareholders by the other directors themselves. In some joint-stock banks there was a feeling among the directors that it was not expedient that the affairs of the depositors should be known to a large board, and, practically, the advances upon securities were determined either by the manager alone or by a small number of the directors. By the very constitution of a joint-stock bank, the confidence which the shareholders must repose in the directors was blind, and was not founded upon any accurate knowledge or information with
  548
  respect to the concerns and management of such bank. It was therefore likely that, from time to time, joint-stock banks would fall into discredit. What the shareholders in such banks generally expected was, that without any trouble they should obtain the high profits of trade combined with the security of an investment in Consols. He did not think that was at all all exaggerated description of the views entertained by many persons who became shareholders in joint-stock banks. It might occasionally happen that, from the mismanagement of directors, or, in some cases perhaps, from want of honesty, the shareholders in such establishments suddenly found themselves called upon to make good losses, and to investigate the affairs of an insolvent bank. Under the existing law they were answerable to the whole extent of their means; but if they should be permitted to limit their liability, they would only be responsible to the extent of their shares. In such case, if a bank became insolvent, the loss would be divided between the shareholders and the depositors. He thought that depositors who trusted a bank established on the principle of limited liability, and who, being aware of such limitation, deposited their money under a voluntary contract, had no reason to complain that, in the case of the failure of such bank, a portion of the loss fell upon themselves. Although, in his opinion, great defects were inherent in the very principle of joint-stock banks, and he did not wish to give them any undue encouragement or protection by legislative measures, yet, merely desiring to put them upon a level with other trading associations, he would vote for the second reading of the Bill.
  MR. MALINSsaid, he thought it was evident that his hon. and learned Friend (Mr. Bovill), though apparently arguing against the application of the principle of limited liability to joint-stock banks, was actuated by a strong feeling against the principle generally. As the principle of limited liability had been sanctioned by Parliament with respect to trading associations, he thought it might fairly be asked whether there was any just ground for establishing an exception in the case of joint-stock banks. His hon. and learned Friend had gone into an elaborate argument to show that the great object of the present measure was to protect directors and shareholders. No doubt, one object of such legislation was to protect directors and shareholders against a greater amount

  549
  of liability than was contracted by the constitution of their partnerships; but, at the same time, ample protection was afforded to the public, and those who dealt with them by the existing law, which obliged companies established on the principle of limited liability to announce the fact by painting it over their doors, and by stating it on their bills of parcels, cheques, and every document they issued. It might be supposed, from the speech of his hon. and learned Friend, that this Bill would establish limited liability absolutely; but that was not the case. If there were two banks in the same town, one established upon principles of limited, and the other on principles of unlimited liability, why should not the public have the option of choosing between them? If in the limited bank it should be found that there was a responsible body of men—responsible not only to the extent of the money they had subscribed, but also by that which was a far better guarantee, the prudence of their conduct as men of business—body of men who would not join a concern without taking care that there was a proper body of directors, and that proper provisions for conducting the business were made, why should not the public say, "we will trade with that bank in preference to the other?" An hon. Member opposite (Mr. Gurney) opposed the Bill on the ground that the principle had not yet been sufficiently tried; but that could be no ground why the experiment should not be extended to banking, for he could not see why the two experiments should not go on at the same time. That it was important creditors should be paid in full he quite allowed; but it was also very desirable to protect another class of persons scarcely less numerous—he meant the shareholders in these banks. Of course, unless clear notice of limited liability were given, every debtor ought to be liable to his last farthing; but where there was a distinct contract beforehand, what ground had a creditor to complain if he lost part of his money through the non-liability of the debtor beyond a certain amount? Parliament should give credit to both parties for being able to conduct their own affairs. It was a fallacy for the Legislature to interpose for the protection of one particular class of persons. if they thought it right that the purchaser of a thousand pounds' worth of iron or corn should be protected by limited liability, why not afford the same protec-
  550
  tion to his next door neighbour in a transaction for £1,000 of gold? For himself, he could see no reason for applying a different rule to the trader in goods and the trader in gold. They were not to assume that every person who became the creditor of a banking company was an idiot, and incapable of taking care of his own affairs; nor was the Legislature called upon to protect those who would not protect themselves. He quite believed, however, that the Bill, if it became law, would not be made use of by many of the existing and prosperous concerns; but he thought they ought not to be treated as if their case was an exceptional one. It was said that the greater sense of responsibility arising from their unlimited liability would make bank directors more vigilant in the conduct of business. Recent cases, however, showed that this afforded a very poor guarantee for prudent management. Whatever might be the case abstractedly, experience proved that it gave the creditors and shareholders no protection whatever. Did the House suppose that because a man's whole fortune was not involved in the success of a bank, he would not therefore bestow all his energies and exhibit all possible prudence in conducting its affairs? In any case the reputation as well as the pecuniary advantage of directors must depend on the prosperity of the concern, and there were plenty of inducements to make them use their best efforts for its benefit. It had been said that there ought to be a reserve in the case of banks, so that one half only of the capital should be paid up, and the other half should be available for the discharge of liabilities if the concern came to a stop; and to this proposal lie fancied there could he no objection. But he repeated that, having secured full notice to creditors respecting the limited liability of shareholders, the Legislature should then leave men to their own foresight, should make them look before leaping, and find out whom they were going to trust. This was the best guarantee for success in commercial transactions generally, and not less so for success in banking. Parliament had adopted the principle of limited liability with regard to traders, and he had heard no good reasons given why it should not be extended also to banks. For these reasons he should most earnestly support the measure.
  MR. BAXTERsaid, he quite agreed with the hon. and, learned Member (Mr. Mathis) that a large proportion of the ar-

  551
  guments used against this Bill were really directed against the principle of limited liability altogether. The Mover and Seconder of the Amendment had talked of moral principles and the Eighth Commandment; but these, if objections at all, were so, to the principle of limited liability, already sanctioned by the House, and it was for the opponents of the measure under discussion to show cause why the principle of limited liability should be productive of advantage when applied to commercial transactions generally, and should be injurious only in those cases in which money was concerned. For his own part, he must confess that he was one of those heretics who could see no good reason why the terms upon which one man should place his trust in another should be at all prescribed by law. It mattered not to him whether they prescribed banks of limited liability or banks of unlimited liability; he objected to prescription in either case, and contended that every man should be left free to take shares in banks, or to deposit his money in any way he pleased. And what, let him ask, apart from all the theoretical objections to the existing law, was its practical application? The right hon. Member for Radnor (Sir G. C. Lewis) had stated that even supposing banks based upon the principle of limited liability were established, the Bill of the hon. and learned Member for Newcastle would be a dead letter. Now, upon that point he begged leave to join issue with the right hon. Gentleman, and to express it as his belief that the public had of late years to some extent lost confidence in those banks which were conducted upon the opposite principle. The failures in the case of the Western Bank of Scotland, the Northumberland District, the Liverpool borough, and the Royal British Banks, had mainly contributed to that result, and would, he maintained, ultimately be attended with the most injurious consequences. He might also adduce in support of the views which he entertained the case of the Monmouth and Glamorganshire Bank, which paid only 15 s. in the pound; while the Royal British Bank, to which he had already referred, paid, he understood, only 12 s. in the pound, there being no likelihood that the shareholders in that bank would ever receive the whole of their money. The inference which he drew from those facts was that men of wealth, indisposed to incur undue risk, would withdraw their money from such concerns, and that they would ulti-
  552
  mately be left in the hands of men possessing little or no capital. He knew many gentlemen who were unwilling to become shareholders in banks conducted upon the principle of unlimited liability, who yet were most anxious to take shares in banks based upon the opposite principle. The law as it stood, however, precluded the shrewd cautious man of business, who was thoroughly alive to the evils which the last few years had brought to light, from carrying on banking transactions in accordance with that system which great experience and much consideration had taught him to be sound and just; and it was because be (Mr. Baxter) deemed it expedient that a man should be perfectly at liberty to carry on the banking business, as he might any other, upon that principle which he thought right, always provided there was no concealment from the public, that he should not hesitate to give his assent to the second reading of the Bill before the House. In taking that course he was not at all prepared to deny that banks with unlimited liability had conferred great benefit on the community. They were, however, attended with many obvious disadvantages. They gave rise to a system of undue credit, and created an undue confidence, which acted most injuriously upon the public at large. That confidence had arisen, not from the prudence of the management, but from the private resources of the shareholders. It was notorious, for instance, that the bills of the Western Bank of Scotland had been discounted in the City of London, not because Mr. Taylor, its manager, or the directors were prudent and discreet men of business, but simply because the Messrs. Baird were partners in the concern. The large sums which were committed to their charge tempted the Directors of such establishments to carry on a very much larger business than was warranted by the amount of their capital, and to discount bills to such an extent as to demonstrate beyond all question that their operations were based, not upon the paid-up capital of these concerns, but upon the private fortunes of the partners. Now, with respect to the banking system of Scotland, although he was ready to admit that it had conferred upon that country great national benefits, he was by no means of opinion that it ought to be indiscriminately praised. On the contrary, he believed that no one who had watched the course of events in Scotland during the

  553
  last few years could fail to arrive at the conclusion that the banks in that country had afforded undue facilities in the way of discounting bills. He, at all events, was one of those who held the opinion that the management of the Western Bank of Scotland amounted to a national disgrace, and be should be extremely sorry to find that no investigation into the affairs of that establishment would take place. But, while he was anxious that such should be the case, he should wish to suggest to the right hon. Gentleman the Chancellor of the Exchequer the propriety of considering whether it might not be expedient that the shareholders in the Western Bank should be permitted to sell the privilege of issuing notes which they possessed. By the failure of that bank, Scotland had been deprived of upwards of £300,000 of note circulation. A permission to sell the privilege of issuing notes would produce £50,000, and, considering the lamentable sufferings which the failure of the bank had inflicted upon numerous families, widows, and orphans, he thought it would be a very proper course to grant the permission which was asked for.
  MR. J. C. EWARTsaid, he agreed with the hon. Member for Montrose (MR. Baxter) that the great objection to banks of unlimited liability was, that it induced persons to discount Bills, and generally to extend the business of the bank, not according to the prudence of the management, but according to the private means of the partners. The hon. Member had referred to the Glamorgan Bank, and he (Mr. Ewart) knew something of the affairs of that bank. He was at that time largely engaged in trade; he received the Customs' money at Liverpool, and the only way in which he could employ it was by way of discount. He discounted largely with that bank, so largely indeed that at last he became alarmed. Others, also, became alarmed, and in consequence the bank stopped payment, and great injury was inflicted on the district. As a general rule he was opposed to all legislation on the question of credit. All the safeguards which legislation could hold out were little better than a delusion and a snare. Let the banks be compelled to publish an annual account of the state of their funds, and then the public might be left to take care of themselves, and they would be in a safer position than any legislative protection could place them.
  MR. H. B. SHERIDANsaid he did
  554
  not think that it was the principle of limited liability that was now on its trial, but rather that of unlimited liability. It must be remembered that it was not for the first time that banks had had limited liability conferred upon them. The Bank of England and various chartered banks were in that position, and in Australia the principle of unlimited liability had been in operation for twenty years, and had been found to succeed.
  MR. SPOONERsaid, he meant to vote for the second reading of the Bill. On a former occasion he had expressed himself as decidedly adverse to the principle of limited liability, and he was still exactly of the same opinion. But while he thought the recent legislation on this point wrong, and that it would ultimately have to be reversed, he could not see why one trade should be conducted upon limited liability while all others were on a principle of unlimited liability. On that ground, and not from any change in his general views, he would support the Bill.
  THE CHANCELLOR OF THE EXCHEQUERsaid, that the Bill had been very satisfactorily discussed and he wished to give the reasons, in a few words, why he should support its second reading. It appeared to him that the object of the Bill was to terminate a restriction upon a principle that had been adopted very generally, both by Parliament and the country, and applied to all trades and occupations of commerce. An exception had been made, he thought, originally from a plausible and prudential feeling, but one which could not be vindicated on any principle, and which no experience of the operations of banking would longer justify. He agreed with almost all who had preceded him, that the discussion ought not to involve any investigation of the soundness of the principle of limited liability. It was not now before the House; they had solely to consider whether the application of that principle should any longer be withheld from the business of banking. It appeared to him that all the complaints that had been urged as to the hardship upon creditors in the event of the failure of a bank of limited liability would have no foundation whatever, if that sufficient warning were given which they knew practically could be given. No doubt it was a great question whether this extension of the principle of limited liability would be of much advantage or not. He confessed he could not help thinking that it would be a very difficult compos-

  555
  tion for banks founded on limited liability to contend with those on the principle of unlimited liability. Should it turn out that the latter continued to command the confidence and support of the public, no great danger could result from the application of this principle and the termination of the restriction; but if, on the other hand, the abuses of the principle of unlimited liability, which were flagrant, exercised a very great effect on public opinion, no one could deny that the result of passing this Bill would be to encourage a tendency to prudence and caution among the community at large. Therefore, either way—whatever alternative they took—if the Bill were not productive of any very great effect, they would only be in the same position as they were before—while, if it did produce considerable results, the consequence would be more prudent conduct on the part of the community, and in the general management of banks. Therefore, it seemed to him that there was no sound principle on which they could resist the second reading of the Bill. He agreed with the right hon. Member for Radnor (Sir G. C. Lewis) that the position of the noteholder was a peculiar one, and that some legislative protection should be provided for him. It was a practical objection to the Bill on a former occasion, that this protection was not given, but it was sufficiently provided by this Bill. As the Bill was drawn, however, there was one objection to it: it had a retrospective influence. He did not think that the shareholders of any bank now established on the principle of unlimited liability should have the power, under this Bill, of lessening that which their creditors would suppose to be their principal security. It might be said by those who preferred the security of unlimited liability, that there was no great probability of the change taking place; and on the other hand it might be said that some would prefer such a change. At any rate it was founded in justice that the creditors of any bank now established on the principle of unlimited liability should not, against their own will and consent, find their security changed into one of a limited character. But if that objection were held to be valid, it could be remedied in Committee; and formed no reason for opposing the second reading of the Bill. The Bill appeared to him to be the necessary consequence of that principle in our commercial legislation which had been already sanctioned. He did not third, it
  556
  necessary at present to give any opinion upon the soundness of that great principle; but it had been urged that the principle of limited liability in commerce had not been sufficiently tried. It might be perfectly true that they had not sufficient data before them to draw a sound conclusion as to the excellence of that principle. It might be that they should have ultimately to retrace their steps. But granting all that, and he only assumed it for the sake of argument, there was no reason why they should not apply that principle to banking. Because the experience of mankind at certain times induced them to believe that they had been led into error, there was no reason why they should not retrace their steps in regard to banking as well as to commerce. Therefore, believing that there was no valid reason for opposing the second reading of this Bill, he should give his vote in its favour.
  MR. HEADLAMsaid, that he had already twice in the course of this Session entered upon a statement of the principles of the measure, and it would be quite unnecessary for him to state them again to the House. But he now felt himself in a difficulty precisely the opposite to that in which he had been on former occasions. On the first introduction of this measure, he could find scarcely an hon. Member of the House who was ready to support him in his conclusions, or to assist him in his arguments. But he was now in a directly opposite position. Now speaker after speaker rose and put forth arguments in favour of the Bill in far better language than he could hope to command, and it would therefore be unsuitable in him to repeat them. But he had one remark t make to the hon. and learned Member for Wallingford (Mr. Malins) with respect to banks of issue. He (Mr. Headlam) did not feel so strongly as others the necessity of making any exception in their favour. The hon. and learned Member said that if all the notes issued by those banks had the words "limited liability" impressed upon them, there would be no great objection in extending the privilege to them. But he (Mr. Headlam) did not attach much value to this. But he should certainly say that the plan proposed by the hon. Member for the Wigton Boroughs (Sir W. Dunbar) might be made available for banks of issue, namely, that of providing a fund to meet the liquidation of their notes, which should be applied to no other purpose. That. however, was a matter for the Committee.

  557
  He had witnessed such grievous and serious evils arising out of the failures of joint-stock banks, that he could not hope by any language of iris to convey an idea of them to the House. But great as these evils were, he had always argued this case upon public grounds, as he had seen just as great evils arise from improvident speculation upon the part of shareholders.
  Question, "That the word 'now' stand part of the question," put, and agreed to:
  Main Question put, and agreed to.
  Bill read 2°, and committed fur Thursday next.

CHURCH RATES BILL.

  COMMITTEE.
  Order for committee read;
  House in Committee.
  Clause 1.
  Sir JOHN TRELAWNYsaid, that having been the Chairman of the Committee which sat upon church rates he wished to correct one or two misapprehensions which appeared to have been entertained during the course of the former debate. A return had been obtained on this subject by the noble Lord the Member for Stamford (Lord Robert Cecil) upon which some argument had been found, but in which in truth a great fallacy was involved. That return gave the number of parishes where church rates had been objected to within the last twenty years, and, accordingly, all the parishes which bad not objected in that time were set down by the noble Lord as consenting to their payment. But the truth Was, there were many towns where the battle was fought and won by the antichurch rate men more than twenty years ago, and where no contest had since taken place, because no attempt had since been made to levy the rates. Thus in Manchester there had been no rate levied for the last twenty years, and yet on a recent occasion no less a sum than £6000 was voluntarily subscribed for the repair of the cathedral church; Tavistock, which, he, represented, was another instance where the church had been repaired in the most satisfactory manner, and was in that respect a model to the whole country. There W as an argument often used by hon. Gentlemen opposite, that church rates were not a tax on the person, but On property. In their origin he believed there could be no doubt they were a tax in personam, and
  though custom had at a later period made them a tax on property, yet the decision in the Braintree case restored the rate to its
  558
  original character of a tax on the person, because that decision established the principle that it required a majority of the parishioners to make a rate. It was another fallacy to suppose that this was a mere Dissenting grievance. The Report of the Committee on the subject showed that many Churchmen complained of it on various grounds, a very common ground being that residents who occupied seats in district churches were obliged to pay to the mother church. It was evident from the papers which had been published on the question that there were others besides Dissenters who suffered from the grievance of church rates. There was great force in an observation which fell from the noble Lord the Member for London on a recent occasion, that they could not have a national church without some national means of supporting it. It was exactly because he (Sir J. Trelawny) wished to see it a national church that he would leave the maintenance of its fabrics to the spontaneous feelings of the people at large. He differed from those who thought that persons who objected to pay church rates should have their names put on the church door, as taking no part in the administration of the rate. If a man was in this way branded as a Dissenter, he would probably dislike the Church ever after. It was admitted by hon. Members opposite that there ought to be some change in the law of church rates. Why, then, did they not legislate with the object of putting the law on a better footing? It was desirable to have all the light possible on this subject, and he would therefore suggest that hon. Members opposite ought to be allowed to bring in their Bills; that they should be read a first time pro formâ; and that the discussion on their merits should take place on the second reading.
  MR. GRIFFITHremarked that be was ready to make the hon. Baronet a present of the country towns, as there would be little difficulty in getting voluntary contributions there to support the fabric of the Church; but what would be do with the £10,000 country parishes where no such voluntary means could be had? He could not see what distinction there was between the payment of church rate and tithe; and he must say that if the argument against church rates was good for anything, it would go to the extent of abolishing the whole Church Establishment of the country, because tithes went to support the preaching of doctrines they

  559
  could not agree to, while church rates were limited to the repair of the parish church. To be logical in their conclusions he thought the supporters of the Bill ought to ask for an entire separation of Church and State. He was aware, however, that there was a wide difference between the political Dissenter in that House, who made ad captandum speeches on this subject, and the honest and respectable Dissenters out of doors. He believed that the latter did not desire to attack the Church Establishment, but that they merely wished to be relieved from a demand which had become obnoxious to them. The House was aware that this was a Bill of so uncompromising a character that no amendment upon the single clause of the measure could he made by the forms of the House. He believed that many hon. Gentlemen opposite had voted fur the Bill who would have preferred a compromise, and who supported it with a mental reservation that they would vote for an Amendment. Did any hon. Member suppose that this Bill would become law? It seemed to him that it only walked through the House as a sort of pious formality, that it would go up to another place, and that the time would be lost that had been occupied in its discussion. He believed that the supporters of this Bill would better consult the feelings of their constituents and the interests of the country by agreeing to some reasonable compromise than by persisting in passing a Bill which was so little likely to receive the Royal Assent.
  MR. BERESFORD HOPEsaid, be felt as strongly as any one the impossibility of maintaining the law of church rates in its present condition, but he could not agree in the mode of action suggested by the promoters of this Bill. To sweep away the ancient provision for the parish churches throughout the country without setting up something in its stead, was revolution and not reform. No doubt, if church rates were abolished, voluntary efforts would supply their places in the majority of cases, but in a few cases they could not, and for these few cases some statesmanlike provision ought to be made. A measure which entirely abolished church rates and threw the support of parish churches entirely on some illegitimate source, such as pew-rents, would do more than anything else to create an idea in the minds of the poorer classes, that the church was no longer the church of the poor, but of the opulent middle classes. A gentleman who
  560
  was stated to be the legal adviser of the great Dissenting bodies, when examined by himself before the Committee of the hon. Baronet, of which he (Mr. Beresford Hope) was a Member, was obliged to allow that very few of the poorer classes found their way into the meeting-houses, which they kept up by pew-rents. He could see no objection to what was called "ticketing" Dissenters. Of course they must consider themselves better than churchmen, and what disgrace could there be in affixing their names to what must be in their opinion a list of honour? But if they objected to it, he saw no reason why the churchmen should not be ticketed and the list affixed at the church door. Thus, instead of a list of Dissenters, there might be one of person who paid church rates and had a right to a attend vestry meetings. An idea had got abroad that the Dissenters would not object to a general payment for the sustentation of the fabric alone; but he would rather give up church rates altogether than adopt such a course; he could not see the difference between supporting the rites of the church and sup! porting the buildings whose value consisted in their being used for those rites. If they were to have a mere fabric rate, it would be the first step towards the continental system, where the state had taken up the property of all religious denominations, and thus unfortunately kept down liberty of conscience on every side. It ought to be recognized as a rule that those only should pay the rate who used the church; they could not shut their eyes to the existence of the large and influential body of Dissenters who had grown up in the land, and who could not be made to pay the rate, and it was necessary that some compromise should be made; but the question could not be settled by a hurried and fragmentary Bill like this. Let them exempt Dissenters, but let the church have the power of raising funds under the prestige of the old name, let the rate be removed from the cognisance of the temporal court, and be recoverable only in foro conscientiœ; and let the church, as a corporation, have power to hold vestries under church officers of its own election, and make a rate on its own members. That would be a proper and an honourable settlement, but the required reform could not be carried out by this Bill, and he therefore hoped it would not be pressed further.
  MR. MELLORsaid, he was not one of those who represented extreme opinions, or

  561
  wished to use the language of menace, as he was quite persuaded that that was not the way to induce the country gentlemen of England to vote for the abolition of church rates. He was, however, induced by his large experience of the practical working of church rates, consequent upon his having taken a part in the Braintree, the Leicester, and the Norwich cases, wherein the law had been fully explored, to caution the House that they could never satisfactorily legislate upon this subject, without in the first instance abolishing the collection of these rates. In short, he had come to the honest conclusion, that no compromise of this question would be satisfactory. It was with that view he gave notice of the Amendment which stood on the paper in his name, and which he hoped would lead to some discussion, if not to some settlement of the question. He was desirous of meeting the wishes of churchmen, so far as he consistently could, and he would therefore willingly give his assistance to propositions for altering the law of mortmain, so as to obtain endowments for repairs, for incorporating churches into diocesan districts, to collect funds, and to let pews, where the letting of pews was proper, and for any improvement in the management of ecclesiastical property which would provide funds for the repairs of churches. But those propositions could be better dealt with when church rates were abolished. He was opposed to limiting the interference of parishioners in the management of parochial affairs, nor could he consent to any proposition which would go to make the distinction between church- men and Dissenters perpetual. He thought that to relieve Dissenters from contributing to the church service, but to make them pay for the repair of the church fabric, was to make a distinction for which there was no foundation. If hon. Gentlemen opposite were ready to relieve the Dissenters from the one, they ought equally to relieve them from the other. Again, to give up the rate in towns where it had been abolished, and to retain it in the country, was to take a low view of the Church of England. According to the statement of Dr. Guthrie, one of the most eminent ministers of the Free Church of Scotland, £300,000 was contributed by a million of persons belonging chiefly to the poorer classes in Scotland for the support of their religion, and he could not bring himself to believe that the wealthy members of the Church of England would allow the parish churches
  562
  to fall into decay. It was well known that a great many things were paid out of the church rates besides the repair of the church fabric. Out of the £250,000 collected, it was probable that not more than £135,000 went to the repair of the churches, and was it necessary or desirable to keep up a continual sore and cancer in many parishes of England on account of such a paltry sum? It would be far better to let the law alone than alter by any expedient which should leave such a cause of excitement in the country. They could not do a more dangerous thing than to assert that church rates and other property rested on the same footing. Was that property which could be refused by a majority? It was well known that the repair of the fabric of the church in the time of Edward VI. belonged to the rector, and not to the laity, by common law, although by custom the laity might be bound to repair. Church rates, therefore, had their origin in the voluntary oblations of the people. Although the laity were compelled afterwards to observe, what Lind-wood styled "this laudable custom" under tile fear of ecclesiastical censures. With the Reformation, however, the reasons which gave validity and sanction to church rates ceased to exist, and under these circumstances there was no great immorality in thinking that the duty of paying them was a very imperfect obligation. He was willing to admit that it was a duty which was incumbent by law, but under the circumstances it was an imperfect obligation, and one which he thought it would be wise and politic on the part of the Legislature to abolish altogether.
  MR. GILPINdenied that the Bill was either a hurried or fragmentary one, or that the friends of this Bill allowed that this was a question which admitted of compromise. It was a question of conscience or it was nothing at all. If persons were willing to pay church rates, no compulsory rate was necessary; if they were not willing, a compulsory rate was tyranny, and tyranny of the worst kind. It had been stated during the debates on this Bill that two members of the Society of Friends at Bristol contributed very liberally to the repair of a church there. But how was the Society of Friends dealt with in London? Twenty-six chairs and a table were annually taken from the Friends' meeting house in Houndsditch, as the price of the liberty of worshipping God according to their conscience. It was

  563
  not true that the agitation on this question was subsiding. There had been a turn of the tide in its favour so far as the votes of the House (which were a pretty fair index of the feeling out of doors) were concerned. In 1853, there was a majority of forty-eight against church rates abolition, whereas, in the present year, there was a majority of fifty-three in the contrary direction. Application was recently made to distrain on three magistrates at Leicester for church rates, but the chief magistrate of that town, to his great credit, rather than sign distress warrants against them, paid the amount himself. The hon. Gentleman who had just sat down talked of Dissenters objecting to be ticketed, but he (Mr. Gilpin) was a Dissenter, and had no such objection. He believed that those who had any earnestness in their profession need not be afraid of saying what they were. When they were afraid, it was time to change. It was as great an injustice to compel an unwilling Churchman to pay Church Rates as to compel an unwilling Dissenter. On the present occasion he might claim the votes of many hon. Gentlemen on the Ministerial benches, who, he found from the records, had voted for the abolition of church rates on former occasions. The noble Lord the Secretary for the Colonies had expressed very emphatically an opinion against church rates. Some of the best clergymen of the Church of England had stated their opinion to be, that the only mode of settling the question was by abolishing compulsory rates. He (Mr. Gilpin) regarded it as a question, not of expediency and policy, but of justice and right. Dissenters did not wish to deprive the Church of England of the power of levying voluntary rates, and it was a discredit to Churchmen to levy any other than voluntary rates. Nor was this a Dissenters' movement against the Established Church. It was simply a movement against a compulsory mode of supporting religion; and, although many people appeared to think that the objection on the ground of conscience, urged against the payment of the rate, was not sincerely felt, he could state from his own knowledge that some of those annually distrained on for that tax were most liberal contributors to the benevolent institutions of the country. The Premier, to a deputation to him on the question, said, with questionable wisdom, that if the Bill were carried through the House of Commons,
  564
  church rates would probably become one of those questions that were hung up between that and the other House of Parliament. Those questions he (Mr. Gilpin) trusted would not be multiplied. If the Bill should pass through the House of Commons, he hoped that the other House would consent to a satisfactory settlement of the question. The right hon. Gentleman the Member for the University of Oxford, while alluding to the withdrawal of the Queen's Letter, advised the members of the Church of England to rely for the support of that Church on the faith, love, and zeal of her members, rather than on other sources. The same advice might be beneficially given with respect to Church Rates. The abolition of Church Rates, so far from being prejudicial to the Church of England, would be beneficial to her best and highest interests, and to those interests which they should all value beyond every earthly institution—those of Christianity itself.
  MR. CUMMING BRUCEsaid, that although he was a Scotchman, he believed he had no small interest in the question. He wished, therefore, to ask the hon. Member who had introduced the Bill whether he meant to extend its principle to Scotland. In that country a charge very similar in its character to the church rate, but much larger in amount, was imposed upon the holders of property. He was himself a Dissenter from the Church of Scotland, and yet his property was annually assessed for the building of churches, for the repair of churches, for the erection of manses, for the repair of manses, offices, and garden walls, and for the establishment of school-houses. In a parish in which he was a landowner he had paid in one year for church-building purposes a sum of £1,100, which was more than the amount he had received for his land in the same period. That was a general charge on the landholders of Scotland, and they never thought that any violence was done to their consciences by requiring them to pay a tax to which their property was liable at the time it had come into their possession. On the contrary, they thought that such a refusal would be putting into their own pockets that which did not belong to them. He might give them as an example the whole body of Dissenters in Scotland, who had never hesitated to pay those charges to which they felt they were by law liable.
  MR. GARNETTsaid, that there was no

  565
  denying that, as regarded the Church of England, they had arrived at what might be termed a crisis. The question they ought to consider was, what was to be done in lieu of church rates, for he took it that is an impost they were doomed. He believed on his conscience that by their abolition there would be no real loss to the Church of England. It was not a question which regarded Dissenters alone, for he had heard clergymen of the Church of England recognize complaints made by members of the Church itself on the subject of the payment of these rates. He would, would, therefore, venture to suggest a solution of the problem, which he trusted the House would approve. If the clause passed, he would propose the addition of one enabling the churchwardens to collect voluntary contributions, to be called "Church offerings," to be assessed on the property now liable for church rates. He would propose that the names should be entered and the amount specified; that the churchwardens should take their book round, in order that any one who was willing to do so might contribute to the maintenance of the Church and its services; that any one who declined to pay should have a note to that effect attached to his name, and that for twelve months after he should have no voice in the vestry with regard to any church matter, and that if he should be willing to pay at the end of that period his name should be restored. The right hon. Gentleman the President of the Poor Law Board, in speaking upon the subject at his re-election upon taking office, said:—
  "My opinion is, that in a parish where the majority is in favour of a rate, and where the property has been acquired subject to that rate, it is right and fair that the rate should be levied. But in a parish where the majority is against a rate, there, I say, it is a fair and thing that no rate should be levied."
  Now, taking that view of the question, he could not think that the maintenance of church rates was necessary. It was something like saying that the rental of estates should be paid if the majority of the tenants were willing to pay their rent, and certainly property liable to such an incident would not be worth a day's purchase; and, for his own part, he believed that there existed courage, faith, and hope enough among the members of the Church of England to meet any difficulty which might arise from the abolition of the rate.
  MR. FOXsaid, he held it to be a well recognised and sound principle, that no
  566
  man should be called upon to contribute to the support of a religion in the tenets of which he did not concur. The hon. Member for Elginshire (Mr. Cumming Bruce) had referred to the Dissenters in Scotland as an example worthy of imitation by the Dissenters of England, so far as willingly submitting to those charges which were by law imposed upon them. The hon. Gentleman, however, had overlooked two important differences between the two cases. In the first place, in Scotland, more perhaps than in any other country in the world, the Church establishment, especially including the Free Church, was in unison with the principles, wishes, and feelings of the majority of the people. That was one important difference. Another was, that the claims for church rates were claims which were attached to the land or other property, which was not the case in this country. It had been said that the Church buildings of this country were national pro-property. They were so; but, that being the case, why was a large portion of the nation shut out of them? By the faith and forms of the Church, many Dissenters were as effectually excluded as they would be by placing the police or the military at the doors to prevent them from entering. It should be recollected that the tithes originally were appropriated in a great measure to the sustentation of the clergy. The burden, however, of paying these tithes was subsequently thrown altogether upon the shoulders of the laity, and the greatest discontent prevailed. Means were at length found to get rid of those tithes, so far as to make their imposition more just. So might it be said of this question of church rates. The religions character of the country had considerably changed since these rates were first imposed, and that change of circumstances had now rendered the imposition of them most unjust. It was, therefore, but reasonable that, like tithes, they should be abolished as far as the Dissenters, at all events, were concerned. At the same he would have no objection to the law remaining so far intact as to enable those who received the benefit of the Church services to contribute to the support of the fabric. All he was desirous of seeing was a measure abolishing the impost of church rates as a compulsory assessment generally. Many substitutes in lieu of church rates had been suggested by members of the Church themselves. He would say, let them settle those differences amongst themselves, but let those

  567
  who differed from the Church be free from the liability to support it. He certainly, for one objected to being ticketed as belonging to this or that denomination. He might not choose to pledge himself in one year as to the exact faith which he might hold in a subsequent year. Was all the progress of a man's life to be reported and ticketed also? Was the churchwarden's book to keep an account of a man's doubts, inquiries, and changes of religious opinion? Let those who worshipped in the church, however, be taxed for the support of the Church if they liked it; lie would heartily assent to that arrangement; and, if the laity and clergy of the Establishment wished to have the power of legally enforcing the rate, as applicable to themselves, and to themselves only, he would not oppose their obtaining it. But to any attempt to fetter opinion or interfere with that freedom of worship which had been claimed for all since the Reformation he must offer a decided resistance.
  LORD ROBERT CECILsaid, that the Free Church of Scotland stood in the same relation to the Established Church of that country as the various Dissenting bodies did to the Church of England; and if church rates were a grievance to the Dissenters in this country they were a still greater grievance to the Free Church in Scotland. The hon. Gentleman who spoke last said that he had no objection to the Church assessing her own members. Now, the cry of the opponents of church rates had throughout been "Entire abolition, and no compromise;" though whether they would obtain as large a majority for that naked proposition as they obtained in the early part of this year might well be doubted. But when Churchmen were asked to support the fabric by themselves, it was forgotten that the Church was muzzled and fettered—that the organization which every Dissenting body enjoyed had been taken from her. He did not say there were not difficulties in the way of Convocation acting in its present form; but it should be remembered that Parliament had suspended its functions; and now they turned round and told the Church that her sustentation was no business of theirs. Parliament thus prevented her from doing her own work for herself, and yet refused to do it for her. That was an injustice that could not long endure. The present numerical majority of the House, which was composed of a variety of sects, appeared intoxicated with their success, and
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  would listen to no compromise. It would be better to take the opinion of the House of Lords before entering further into this controversy, and if that assembly took the same view as the lower branch of the Legislature of course there would be an end of the question. If, on the other hand, they rejected the proposition, the House of Commons would approach the subject in another Session in a temper much more favourable to a reasonable adjustment.
  SIR ARTHUR ELTONsaid, that the question of giving the Church power to raise a voluntary rate had nothing to do with the question before the House, and he would suggest, therefore, that they should now divide on the first clause, and then discuss the Amendments which he had put on the paper in their proper order.
  MR. COLLINSsaid, he would admit that the present Bill was an improvement in several important respects upon its predecessors. But it inflicted an injustice on the Established Church in providing no machinery by which her members could supply the wants of their own communion, unhampered by the interference of those who declined to contribute towards her support.
  MR. ALCOCKsaid, that the patience of the country had been completely exhausted on this subject. Twenty-five years ago it was admitted that of the sum of £550,000 which was then annually levied for church rates, more than one-half was an abuse, and since that time every successive Government, with the single exception, perhaps, of that of the Earl of Derby, had promised to settle this vexed question, and the people of England now knew that they must trust to their own exertions alone if they ever wished to see the required change effected. In 1832 two-thirds of the first Session of the reformed Parliament were occupied by the discussion on Irish tithes and Irish church cess) and the result was, that both of those questions were settled within two years—the Duke of Wellington and the then Bishop of London supporting the change.
  MR. BIGGSsaid, he had no conscientious feeling with respect to church rates, but he believed that their continuance was utterly inconsistent with good government and with the discharge of the proper duties of the magistracy. In the town he had the honour to represent (Leicester) there were no church rates, for his constituents had abrogated the law for themselves seven years ago. In that town,

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  however, fifteen years ago, a gentleman named Baines had had a warrant served on him for church rates; he declined to pay those rates, and was cited into the Ecclesiastical Court, and afterwards sent to the county gaol, where he lay far six months, and would have still lain there if it had not been for himself. This was the first time the public had heard of the matter. He and some others had subscribed about £50; the money was sent privately, and no one in the town to this day knew the process by which he was liberated. In 1841 and 1848 he was called on to keep the peace in his town, for when there was a sale of goods seized for church rates, 2,000 or 3,000 people collected, and nobody would bid for the goods. At one time there were many thousands of chartists in the streets, and was he to risk the peace of the town by levying for church rates? What was he to do? Why he gave the magistrate's clerk a blank cheque to use as he liked. It was used in the last extremity. It was like oil poured upon the waters and peace was obtained. He was once upon the bench when there were six magistrates there, four of whom were in favour of church rates. The whole six magistrates were invited to dinner at the same house; and as the warrants for some church rates could not be signed at the bench because the dinner hour had arrived before they were prepared, they were taken down to the gentleman's house where they were dining, and were signed on the very table which might, perhaps, be seized, for the gentleman was a defaulter. Three of his brother magistrates felt that they could not conscientiously pay these rates, and they had been seized on, and for a few shillings half a dozen sheep had been seized, killed, and sacrificed. He looked upon this rate as a civil impost, a civil injustice, though he did not care conscientiously one jot about church rates, At length the church-wardens became ashamed of levying for church rates, and gave a hint that if a voluntary rate were given, they would not levy church rates, and then the very gentlemen who had objected came forward and subscribed, for they, like himself, and others who had travelled over the continent of Europe and America, loved the glorious old fabrics of the village churches of old England, and would not allow them to fall into (lust on any account whatever.
  Question put,—"That Clause I stand part of the Bill,"
  The Committee divided:—Ayes 227; Noes 153: Majority 74.
  Clause agreed to; as was also Clause 2.
  Clause 3, providing that the Act should not extend to Scotland or Ireland.
  LORD ROBERT CECILsaid he would move the omission of the words "Scotland or." If the principle were true in England that Dissenter's should not be called upon to contribute to the support of the Church, he saw no reason why the same exemption should not be extended to the Dissenters in Scotland.
  MR. CUMMING BRUCEsaid, he would oppose the Amendment. The people of Scotland did not desire the proposed exemption. They considered it their duty to support the Established Church as the church of the poor, and did not wish to see its energies crippled,
  MR. BLACKsaid, that although the people of Scotland had no church rates they had what was ten times worse—the annuity tax of Edinburgh and Montrose, and he would support the Amendment as paving the way for getting rid of that grievance.
  SIR JOHN TRELAWNYhad no objection to extend to the Dissenter's of Scotland the same relief which the Bill granted to the Dissenters of England; but he thought it would be necessary to introduce a separate measure for that purpose.
  MR. BOUVERIEsaid, he did not understand the meaning of the clause, because while it said that the Act should not extend to Scotland or Ireland, the first clause provided that no church rate should be made or levied in any parish in England or Wales. He would recommend that the clause should be struck out altogether.
  MR. BRIGHTalso thought that the clause was unnecessary, and hoped it would be left out.
  LORD ROBERT CECILsaid, that as the clause was nonsensical any Amendment upon it must be nonsensical too. He, therefore begged to withdraw his Amendment.
  MR. PALKsaid, he had given notice of an Amendment, which he hoped would have conciliated both sides of the House. The object of it was to allow the churchwardens, with consent of the vestry, to raise such sums from time to time as might be required for the maintenance of the fabric of the church, and to charge the same on all property within their parish. He thought such a provision only just towards the members of the Church, but after the division which had taken place, and in the present temper of the House, it was not now his intention to move it, believing

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  that, as the Bill was tinged with the greatest illiberality, it would be defeated in another place, and that then the House would be more inclined to listen to the voice of justice and reason.
  Clause 3 put and negatived.
  SIR ARTHUR ELTON SIR ARTHUR ELTON moved a clause, providing,
  "That any church rate made before the passing of this Act, and since the 1st of January, 1838, may be collected and recovered in the same way as if this Act had not been passed."
  He said, that unless such a provision were adopted great inconvenience would result. He had also given notice of his intention to move another clause to allow the parishioners to make a voluntary rate, and enacting that those who refused or neglected to pay the same should not be entitled to vote at any vestry summoned for the transaction of church business for the space of eighteen months. He thought that the professed friends of the Church would do well now to make some terms of settlement which would be fair. In most agricultural parishes church rates would be collected much as at present, only they would be the voluntary offering of free hearts instead of a compulsory contribution, collected under the pressure of a distress warrant.
  SIR JOHN TRELAWNYexpressed his willingness to accept the clause.
  MR. GLADSTONEasked why the operation of the clause was limited to rates made after the 1st of January, 1858?
  SIR ARTHUR ELTONsaid, it was necessary to fix some time, and therefore he fixed the first day of the year.
  MR. MELLORsuggested that the terms should be before the passing of the Act.
  MR. GLADSTONEproposed, that the words "since the 1st of January, 1858," should be omitted.
  Words omitted.
  Clause, as amended, agreed to.
  SIR ARTHUR ELTON SIR ARTHUR ELTON moved the following additional clause:—
  "The churchwardens of every parish in England and Wales shall, some day in the month of in each year, give an account to the parishioners at a vestry meeting of all money they have received, and also of all they have expended in repairs and otherwise, for the use of the Church during the past year; and, the said account having been allowed by the parishioners, the churchwardens shall lay before them an estimate of the cost of repairing the church and churchyard, and conducting public worship for the ensuing year; and it shall be lawful for the said churchwardens and parishioners to make a voluntary rate upon the occupiers of all property now liable to church rates in such parish, for the pur-purpose of defraying the amount of the said estimate. Provided always, that no occupier of such
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  property, who shall have refused or neglected to pay the said voluntary rate, after the same has been duly demanded of him, shall be entitled to vote at any vestry summoned for the transaction of Church business for the space of eighteen months."
  SIR JOHN TRELAWNYsaid, he must oppose the clause on the ground that it would tend to confusion in the law. As far as he understood the evidence of Dr. Lushington before the Committee, the Bill as it stood, would not remove the existing machinery for the repair of churches. Members of the Church might, if they chose, put funds into the hands of the churchwardens, who were bound, so long as money accrued to them, to apply it to the maintenance of the fabric.
  SIR WILLIAM HEATIICOTEsaid, he thought they ought to pay great attention to the hon. Baronet (Sir A. Elton), for no one could doubt his sincere desire to benefit the Church of England. Moreover, now they had won their victory, there seemed to be a greater disposition on the other side of the House than existed before to make a conciliatory arrangement respecting this question. With the speech of the hon. Member for Oldham (Mr. Fox) in his mind, he would suggest to the hon. Baronet (Sir A. Elton) the propriety of withdrawing this clause and substituting for it upon the Report one framed on the principle which the hon. Member said he was ready to support—namely, that there should be the power of raising the rates by a compulsory process, which process, however, should only be applicable to such persons as chose to subject themselves to it. [Laughter.] Perhaps he had expressed himself awkwardly, but the principle alluded to by the hon. Member was not at all to be ridiculed, providing, as it did, that the rate should be rendered compulsory in its operation upon persons who entered their names as members of the Church of England. He believed that if this principle were adopted it would be more satisfactory to the hon. Baronet (Sir A. Elton) than even his own suggestion.
  SIR ARTHUR ELTONsaid, he was unable to go along with the hon. Member for Oldham (Mr. Fox) in the point mentioned by him, and could not sanction any proposal to subject one section of the community to a compulsory tax from which all others would be free. As to the objection that the clause would create confusion, Sir William Clay had taken great care in his Bill of 1854 to provide that the action and jurisdiction of the church. wardens should be maintained, and he (Sir

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  A. Elton) considered that his proposal was a necessary complement of the present measure. His desire was that the churchwardens should remain as they now were—guardians of the fabric of the church, and responsible for the conduct of public worship. He would therefore allow churchwardens and parishioners to meet fairly together in vestry, look over the accounts, calculate what amount would be required for the service of the ensuing year, and make a rate, the payment of which was not compulsory in any court of law, but was left to the option of the parties. Any one who paid this rate should be considered, for vestry purposes, a Churchman; and if this were enacted he believed that many Dissenters would pay the voluntary rate in order to obtain the privilege of taking part in the proceedings of the vestry.
  MR. LABOUCHEREsaid, he agreed with the hon. Baronet in thinking that if church rates were to cease as a compulsory payment by Dissenters, they should not be extorted from any other section of the community. In the interest of the Church itself he would carefully avoid drawing a line between Churchmen and Dissenters in this particular. At the same time, consistently with that object, it would be a reasonable thing—especially in those country parishes where people would be generally willing to contribute towards the maintenance of the fabric—to provide some local machinery whereby funds could be collected and applied. The point was one which required consideration, but it would be highly desirable to allow the present machinery to stand so that it might he made available throughout the country. He would, therefore, suggest that the hon. Baronet should carefully consider the terms of his clause, and put it into a shape which would not be liable to objection.
  MR. HENLEYsaid, the object which the hon. Baronet the Member for Bath (Sir A. Elton) had in view was one, no doubt, of a very praiseworthy character, and it was extremely natural that having lent his aid to destroy the means by which the fabric of the church was supported he should not be perfectly satisfied with the position in which matters, under those altered circumstances, would stand. The hon. Baronet the Member for Tavistock (Sir J. Trelawny) had in his (Mr. Henley's) opinion very properly contended that the effect of the proposed clause would be to make confusion worse confounded, and he felt assured that if the
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  right hon. Gentleman who had just spoken would take the trouble to read it, he would find that its probable effect would be to defeat the object which its mover had in view. It made no provision for ascertaining beforeh and who would be willing to pay, while it gave to the churchwardens power to levy a rate upon the occupiers of all property now liable to church rates; that was to say, upon Dissenters as well as Churchmen—thus adopting a course calculated to stir up those angry feelings which everybody must be anxious to see for ever extinguished. Well, let him suppose that the parishioners of a particular parish consisted of half Churchmen and half Dissenters. The churchwardens would call them all together, and perhaps include an architect in the consulting body. It would be agreed, say, that a sum of £100 was required; but then it would be found that only one-half the parishioners would pay, so that a sum of only £50 would be forthcoming. He could not conceive a clause that would be likely to lead to greater confusion. He should like to see, in proper form, a clause such as the hon. Member for Oldham (Mr. Fox) proposed. One could understand such a clause as that. It would, at least, have the merit of securing that the number of people who put down their names should pay the amounts required of them. There was something feasible in that, but he could not see the advantages of creating an expensive machinery which would creating an expensive machinery which would bind nobody. He thought the principle of the clause now before the Committee would not work, and having a strong opinion upon the matter he should vote against the clause, for he did not think it would be creditable to the Legislature to send such a specimen of legislation to the country.
  MR. CROSSLEYsaid, he could not understand the generosity of justice. If a thing was just there was no generosity in doing it. He could tell the House that it was perfectly useless to apply to the Legislature to pass an act to enable people to do a voluntary act. There was no occasion for an act if it was not to contain something compulsory. The speech of the hon. Baronet the Member for the University of Oxford (Sir W. Heathcote) showed great ignorance of the voluntary system. There was no use in going to people for a voluntary rate and telling them that their share was so much. He should recommend those hon. Gentlemen who were anxious that the Established Church

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  should flourish, to pause before they vested in the churchwardens a power to levy a rate which all who did not pay would, as it were, be turned out of the Established Church and made Dissenters.
  MR. MELLORmaintained that the clause was inconsistent in terms, and would give no greater power than the law as it stood conferred.
  MR. COLLINSsaid, he had great faith in the voluntary principle, and did not believe that there would be those difficulties in the way of the operation of the clause which the right hon. Gentleman (Mr. Henley) seemed to suppose. The majority of the people in rural parishes were not a very fluctuating body, and it would soon be known what proportion of them were likely to contribute their quota, and who were not. He hoped the hon. Baronet would press his Amendment to a division.
  MR. CROSSsaid, that as a single fact was worth an immense amount of speculation, he might be permitted to state that in the city of Manchester a voluntary rate had been levied, and that the system had worked admirably for a considerable period.
  SIR ARTHUR ELTONsaid, that after the discussion which had taken place he should not press the clause, but would give his best consideration to its provisions with a view, if possible, of reducing it into a more workable shape, and then re-introduce it on the Report.
  Clause withdrawn.
  House resumed.
  Bill reported as amended, to be considered on Tuesday next.

POOR LAW AMENDMENT BILL.

  CONSIDERATION.
  MR. CROSSproposed to omit the words "or any local Act." The object of the Bill was to remove an anomaly in the existing law by which all occupiers of houses above £6 and under £20, the rates of which were paid by the owners, were not entitled to be placed upon the burgess list, while the occupiers of houses similarly situated, the value of which was under £6 were entitled to vote at municipal elections. The words which he proposed to omit had been objected to, overriding all local Acts without any inquiry into the circumstances of those Acts.
  MR. SOTHERON ESTCOURTsaid, he thought the suggested omission was desirable.
  Amendment agreed to.
  Bill to be read 3° To-morrow.

NON-PAROCHIAL REGISTER BILL.

  COMMITTEE.
  Order for Committee read.
  House in Committee.
  Clauses 1 and 2 agreed to.
  Clause 3.
  MR. WALPOLEsaid, he proposed to fill up the blank in clause 3 with the sum of £1200 as the salary of the Registrar General. Hitherto the salary of that Gentleman had been £1000 a year, with extra allowances for preparing the census. This method had been found inconvenient; and, in accordance with the recommendation contained in the report of a Committee of the House, it had been determined to propose that the salary should in future be fixed at the amount stated. He believed it had been the intention of the late Government to suggest the change now proposed. The Registrar General had saved the country considerable sums by the manner in which he managed his department, and no one could doubt that he was entitled to the increased salary now proposed.
  MR. WILSONapproved the increase, but remarked that the subordinate officers of the department would still be remunerated by extra payment for their labours in taking the census.
  Clause agreed to, as were also the remaining Clauses.
  The House resumed.
  Bill reported as amended, to be considered To-morrow.

PROPERTY QUALIFICATION BILL.

  COMMITTEE.
  Order for Committee read.
  Motion made and Question proposed,—
  "That Mr. Speaker do now leave the Chair."
  MR. BENTINCKsaid, he hoped that the hon. Gentleman would not press his Bill on that night. It was obviously impossible that a Bill of this importance could receive proper consideration and discussion at that hour (five minutes past Twelve). He would not, therefore, go into the question at all, but would simply move that the debate be adjourned.
  MR. HORSMAN: If this Bill was one on which there was much difference of opinion in the House it would be only fair to the House that my hon. Friend should listen to the request of the hon. Gentle-

  577
  man; but as it was read a second time with the general assent of both sides of the House—the Government assenting to it—the general principle has been assented to. It is a very simple Bill, consisting of only one clause, and there is no sufficient reason why it should be opposed in this stage. I hope, therefore, that we shall not be prevented going into Committee.
  MR. PACKE, said, that from his speech the right hon. Gentlemen must really imagine that this Bill has been well discussed. It is generally the practice for hon. Gentlemen who have the conduct of a Bill to accede to the wishes of any Member who wished to have time to oppose it. This is a question which is likely to lead to discussion, and I hope the hon. Member will give way.
  MR. LOCKE KING: I must remind hon. Members that the House has passed the second reading of this Bill, and that what was necessary to be discussed was discussed on the second reading. If the hon. Member for Norfolk (Mr. Bentinck) is inclined to discuss the Bill now, I am sure the House will be ready to hear him.
  MR. KNIGHTLEY: In answer to the statement of the right hon. Gentleman the Member for Stroud (Mr. Horsman), I beg to say that the second reading of the Bill was passed, I will not say surreptitiously, but very unexpectedly. I and several other Gentlemen paired off in favour of the Government, supposing that Her Majesty's Administration would oppose the second reading, but we found, to our great astonishment, that my right hon. Friend (Mr. Walpole) rose and with his usual seraphic smile gave in his adhesion to the principle of the Bill. I can only say, that when Her Majesty's Government abandon what we think sound Conservative principles we must oppose them, and as we mean to give all the opposition in our power to this Bill it is notch too late an hour to proceed with it.
  THE CHANCELLOR or THE EXCHEQUER: I do not think hon. Gentlemen opposite have any reason to complain of the manner in which this Bill has been received by Gentlemen on this side of the House. It must be admitted that a full and fair discussion should be afforded to every measure. I was not present when the second reading of this Bill was passed, but if I had been I should have agreed with my right hon. Friend in supporting it, believing, as I do, that the time has come when it is desirable that such a measure should be adopted. I do not know
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  what may be the opinion of hon. Gentlemen who paired off, but I must say that is not exactly a Parliamentary phrase to be used in this House. I have heard, however, that the discussion on the second reading took place at as late an hour as this, and hon. Gentlemen, therefore, could hardly have had a fair opportunity of discussing the measure. There may be hon. Gentlemen who entertain different views to those who support the Bill, and they have a right to have a discussion upon it, and as I should be sorry if that right was obtained by means of a division, I think hon. Gentlemen opposite should meet the wishes of those who desire further discussion. Therefore, although I am not opposed to the measure, still I think it so advantageous that there should be a formation of public opinion on such a question by means of ample and free discussion, that I shall support my hon. Friend (Mr. Bentick) in his attempt to obtain it.
  Motion made, and Question proposed—
  "That the Debate be now adjourned."
  The House divided:—Ayes 81; Noes 156: Majority 75.
  Question again proposed.
  MR. HUMEsaid, as he was determined to oppose the Bill by every means in his power, he would move that the House do now adjourn.
  Motion made, and Question proposed—
  "That this House do now adjourn."
  SIR HENRY WILLOUGHBYsaid, he hoped the hon. Member for Surrey would not persevere in the face of the opposition which was threatened. He thought time should be given to discuss the measure.
  MR. MALINSsaid, he was in favour of the principle of the Bill, but was averse to going on with it at so late an hour.
  MR. E. BOUVERIEremarked, that he had always found that it was in vain to encounter a determined opposition in such circumstances as the present, and, therefore, recommended his hon. Friend the Member for Surrey not to press his Bill that night. There was no doubt of his hon. Friend carrying his Bill, as he had not only a great majority of the House, but Her Majesty's Government also in its favour.
  MR. LOCKE KINGsaid, he would not, under the circumstances, press the Bill that night, but postpone it till Tuesday.
  Motion, by leave, withdrawn.
  Debate adjourned till Tuesday next.
  House adjourned at a quarter before One o'clock.