Bank-notes Not Legal Tender.

The bank-notes were never made legal tender. The question whether they were to be such was put to Mr. Pitt in the House when the Restriction was ratified. He replied that they were to be so from the Bank to the public When pressed on this point, especially by Mr Nicholls, who asked, “whether it was his intention that the notes of the Bank of England should be a legal tender from the Bank to the public creditor,” and declared that, if so, it was an act of insolvency, the minister evaded a reply.

In 1801, Mr. Grigby demanded of Oakes & Co., country bankers, gold for a five-guinea note issued by them. They offered a £5 Bank of England note and five shillings. He refused the note, and demanded gold, and as he could not get it, he sued. He gained the suit at the assizes, and the question of law being reserved for the four judges of Common Pleas, they all agreed that the plaintiff was in his rights, and that notes were not legal tender between man and man.

In 1810, a Jew named De Yonge, and a stage-driver, James King, were prosecuted for selling and buying guineas at a premium in paper. The cases were brought under an act of Edward VI. against trading in gold or silver at other than rates fixed by law. The men were convicted, the penalty being a year's imprisonment and fine, but they were admitted to bail, and sentence reserved. After long delay, the twelve judges in the Exchequer Chamber decided that their cases did not come under the statute cited.

In 1811, Lord King demanded his rents in specie or paper equivalent. No one denied his right to make this demand, but “he was vehemently abused for incivism.” In the same year, and with reference to this act of Lord King, Lord Stanhope introduced an act, which was passed, making it a misdemeanor to buy or sell guineas at more than their denominational equivalent in paper. If a debtor offered notes he was to be free from distraint, but the creditor retained all other remedies. How near this came to a legal-tender law it would be hard to define. The courts never passed upon it. By the force of public opinion, and a general disposition to make the best of circumstances, the notes were used universally.