JOINT STOCK BANKING. 363 



metropolis at all times, and even under circumstances in which the 

 private Banker (as in the panic of 1825 for instance) has so much dif- 

 ficulty to protect himself, that his usual customers are left entirely to 

 their own resources. 



It has been urged against the success of such undertakings in the 

 metropolis, and to deter persons from becoming partners in them, that 

 the responsibility of the shareholders is unlimited that such concerns 

 cannot be well managed by the instrumentality of directors that there 

 is something peculiar to the business of banking, and to the class of 

 customers in London, which will prevent such Banks being profitably 

 conducted ; that not being Banks of issue, they cannot allow any in- 

 terest on deposits ; and that their capital being merely nominal, or not 

 paid up to the full extent, they only offer an apparent security to the 

 public ; and that without a charter or act of parliament they cannot 

 sue or be sued, &c. To these objections it has been answered, that, 

 by the deed of copartnery, the shareholders mutually agree to gua- 

 rantee and stand by each other, against any claim that may be 

 brought against them; and that, practically, each member is only 

 liable to the amount of his share holders of the stock of the Bank of 

 England being exactly in the same predicament.* And it is further 

 urged, that by the provisions of the same deed, each partner, in the 

 event of one-third of his subscribed capital being lost, can effectually 

 secure himself against further damage. The successful manner in 

 which the affairs of the Joint Stock Banks in Scotland, and also the 

 important concerns of the Bank of England, are managed by directors, 

 is a sufficient refutation of the second objection ; and in regard to the 

 third, it is difficult to conceive, amongst such a choice of customers, 

 and with numerous partners scattered over every part of the metropo- 

 lis, and interested in conveying the best intelligence to the directors 

 of the Bank, that any peculiarity in the class of customers can, if 

 proper circumspection be used, prove injurious. With regard to 



* The 20th chapter of the 5th of William and Mary, establishing the Bank of 

 England as a corporation, declares this liability, and " that in every such case an 

 action for debt shall and may be brought," &c. " against all and every, or any one 

 or more of the persons who shall be members of the said corporation," &c. : and 

 the 49th section of the 20th chapter of the 8th and 9th of William III., provides, 

 " that the Governor and their successors shall always take care that the sum 

 total of all their debts do not exceed the value of their capital stock," and that if 

 any division of money, " or other dividend whatsoever," be made, " so that the 

 value of the joint-stock or capital undivided, shall not be sufficient to answer their 

 just debts then remaining unpaid ; in every such case the particular members, and 

 every of them respectively who receive any share of such dividend, shall be 

 severally liable, so far as the respective shares so bj them respectively received 

 upon such dividend will extend, to pay and satisfy the debts which shall remain 

 due and unpaid by the said Governor and Company," &c., and may be sued ac- 

 cordingly, u any thing in this act, or in any former act, charter-, or otherwise 

 howsoever to the contrary notwithstanding." 



We have not space to give these clauses at length, but they are worth the 

 serious consideration of the holders of Bank Stock, who will not find in any of 

 the acts of parliament a limitation of responsibility in their favour as a privilege. 

 The consequence, therefore, would appear to be, that the proprietors of Bank Stock 

 are, like the partners in any other commercial establishment, liable at common 

 law, jointly and severally, to the debts of the Bank of England ; a fact which 

 should be generally made known. 



