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by other country bank notes. good payment if not objected to.

Where a note or half-note is lost or destroyed, payment of it, if refused, may nevertheless be compelled by bringing an action at law upon it (as it may in the case of any other lost negotiable instrument), and a judge may order that the loss is not to be set up as a defence to the action, upon an indemnity being given to his satisfaction against the claims of any other person upon the bill.

6. Bank notes being promissory notes, they constitute a debt due to the holder, and payable by the banker on demand. The consequence of this is that, if the bank fails, and the assignees of the banker have any claim upon the holder of the notes, he may set off the full amount against the assignees, instead of proving with the rest of the creditors and getting only a dividend. But he cannot do this if he took the notes with notice of an act of bankruptcy.

But the latter will be a

7. Any one who has watched the ordinary mode of proceeding in a London bank, must have observed the great expedition with which a number of Bank of England notes are recorded, by entering the first and last numbers and dates of a series, and counting the number delivered.

The abstraction of one note from a bundle would be immediately detected. In case of subsequent loss the description of the note delivered can be ascertained. This important operation is carried on by a system which enables a clerk to tell off large sums in the time that is taken to make a short entry.

In case of the loss of country bank notes, the bankers can give no description of the particular notes issued by them in payment of a cheque. When they are sent up to London in payment to bankers, they are the occasion of much trouble and too frequently of fraud. Each note has to be examined and recorded separately, and when bundles of notes are delivered, purporting to contain certain sums, abstraction cannot be detected except on detailed examination; and when it is detected no means are afforded of tracing a missing note.

8. NO NEW BANK can now be formed in any part of the United Kingdom for the issuing of notes.

All banks formed previous to the 6th of May, 1844,

lawfully issuing their own notes, under the authority of a licence to that effect, may continue, under certain restrictions, to issue such notes to the average amount fixed by the Commissioners of Stamps, &c.; which amount must not be exceeded.

9. If any bank of issue, not having more than six partners, should increase this number, say to ten, it would lose the privilege of issuing notes. The law having fixed the amount of notes which any given bank may lawfully issue, without, be it observed, requiring the banker to prove his ability to discharge the notes so issued, it does appear a fallacy, that when a banker is desirous of increasing the security to the public, by adding to the number of parties responsible for the due payment of the notes, the law should step in and prevent his doing so-nay, should he attempt to do it, his power of issuing notes would be ipso facto at an end.

10. A bank of issue may re-issue any notes not above the value of £100 as often as they may think proper; and should any member of a firm, issuing notes, die or retire from the banking business, the surviving partners may continue to issue the prescribed amount of notes; but in the event of a new formation of the bank, which does not include a member of the old firm, the privilege of issuing notes will cease.

11. BANKS OF ISSUE are allowed to compound for the stamp duties on their notes at the rate of 7s. per cent. per annum, upon the full authorised amount of the circulation; and to include, on the same terms, their bills drawn on London at twenty-one days' date.

12. Every banker in England and Wales issuing bank notes, must, on some one day in every week, transmit to the Commissioners of Taxes an account of the notes of such banker in circulation, on every day during the preceding week, and also an account of the average amount in circulation for four weeks, completing each successive period of four weeks, and also the amount of notes which such banker is authorised to issue.

Such account to be verified by the signature of the banker or his chief cashier, and in the case of a joint-stock bank by the managing director or chief cashier of the bank; and if any such banker refuses or neglects to render such account, or shall at any time render a false

account, such banker, &c., will be liable to a penalty of £100.

In order to ascertain what amount of notes are in circulation by such issuing banks, each bank must furnish to the said Commissioners a monthly statement of notes in the hands of the public, and if that exceeds the amount such banker is authorised to issue, he is liable to a penalty equal to the amount by which the average monthly circulation shall have been in excess.

To ensure the rendering of true and faithful accounts of the amount of bank notes in circulation, the Commissioners are empowered to inspect the books of every banker issuing notes; and if any banker, or other person keeping any such books, shall upon demand made refuse to produce or permit their inspection, he will be liable to a penalty of £100.

13. Every banker issuing notes must take out an annual licence to authorise the issue of such notes, and must take out a separate licence for every town or place at which he issues notes.

The application for a licence must state the Christian and surname and place of abode of the person to whom the licence is to be granted, and the place and places where the notes are to be issued, and also the name of the firm under which the notes are to be issued.

The amount of duty paid by bankers in the United Kingdom for the privilege of issuing notes during the past year was £30,400.

14. Every banker in England and Wales who is now carrying on, or shall at any future period carry on, the business of a banker, is compelled, on the 1st of January in each year, or within fifteen days thereafter, to make a return of his name, residence, and occupation, or, in the case of a company or partnership, the name, residence, and occupation of every person composing or being a member of such partnership, and also the name of the firm under which such banking company is known, and of every place where such business is carried on; and if any such banker shall omit or refuse to make such return, he shall forfeit and pay the sum of £50.

15. There is a difference between the English, Scotch, and Irish banks in respect to the issue of notes. The former cannot issue notes beyond the fixed amount, irrespective

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of any amount of gold they may have in their coffers whereas the latter banks are allowed to issue, over and above their fixed issue, any amount of notes they please, provided only that they possess a corresponding amount of gold.

16. Country banks of issue are not allowed by law to pay cheques in any other manner than in Bank of England notes, gold, or in their own notes; yet it does sometimes happen, when the amount of their circulation is at the maximum, to give the notes of other banks which may be in their possession, in discharge of the cheque. Of course it is at the option of the party presenting the cheque to receive or reject the notes so tendered.

CHAPTER VII.

OF JOINT STOCK BANKS.

1. Banking Company may register under Act of 1862. 2. And now, if its Members exceed ten, it must Register. 3. Companies existing before the Act may Register on giving notice.

4. Registered Banking Companies must publish statements once a year.

5. Banking Partnerships of not more than ten.

6. Banking Partnerships of more than six, before 1844.

7. Since 1844.

8. Existing Companies invited to register under Act of 1862.

9. Restrictions as to Amount of Capital and Shares, abolished.

10. Directors of Companies bound by Prospectus. 11. Agreements for sale of shares, &c., in Joint Stock Banks must state number.

12. Shareholders entitled to see List of Shareholders.

1. By the Companies' Act 1862, sec. 6, seven or more persons associated for any lawful purpose may, on complying with the requirements of the Act, form an incorporated company with or without shares, and with or without limited liability. This, of course, includes banking companies, which are also expressly referred to in other parts of the Act.

But, by sec. 182, no banking company claiming toissue notes in the United Kingdom shall be entitled to limited liability in respect of such issue, but shall con-tinue subject to unlimited liability in respect thereof; and the whole of the liability of the issue is to be borneby the members in addition to their liability for unpaidup capital.

2. Under sec. 4 of the Act, there is a peculiarity con-cerning banking companies as regards the necessity of registration. A partnership may be formed for anyother lawful purpose without being obliged to register, unless its members exceed twenty in number; but no

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