This article analyzes and interprets the records in the National Archives and Hampshire Record Office in Winchester relating to Henry Austen’s bankruptcy on 15 March 1816. Henry became bankrupt because he owed the Crown £44,4451 in taxes collected by him as Receiver-General of Taxes for Oxfordshire (shortened to “Receiver”). The main new material includes a twenty-three-year period of the accounts of the sureties, Henry’s brother Edward Knight and his uncle James Leigh-Perrot (and James Austen and Mrs. Leigh-Perrot as James Leigh-Perrot’s executors), who had given a bond to the Crown to guarantee Henry’s liability to pay over the taxes collected by him. As far as I know, these accounts have not previously been found in the Hampshire Record Office by researchers. The assets at the time of the collapse have also been more fully analyzed. Together these enable a much fuller picture of the financial position. For example, at the time of the collapse there were assets available to pay the tax debt in full without calling on the sureties, and the Crown held off calling on them for two years. The biggest unknown still remaining is what assets the Crown recovered in those two years, for which there are only some totals but no accounts.
The conclusion of this new research is that the sureties did eventually recover everything that they paid, although they did not recover all their costs. This recovery took a long time, mainly for reasons outside their control. In addition, the full story behind the legacy of Henry Maunde (one of Henry’s banking partners) will be given; the legal situation of Lord Moira’s bills of exchange given to the Bank that fell foul of the usuary laws will be analyzed; and further information will be provided about the financial benefits to Henry of his being a Receiver. Much has been written about the background, which I shall not attempt to repeat.2 Although I try to analyze only facts, I shall conclude with some comments on how in the light of them I assess Henry as a banker. The following is an overview of the figures that will be expanded on later.
Table 1 shows, first, that the sureties originally paid less than is often suggested7 because the Crown waited for two years before calling on them, during which about half of the tax debt was collected out of the Bank’s and Henry’s easily realizable assets. Secondly, it can be deduced from the fact that depositors in the Bank eventually in 1843 received over 51% of their deposits and that the sureties recovered the whole of what they paid the Crown on account of the Bank; the sureties stood in the shoes of the Crown, whose liability had preference, and therefore their liability had to be repaid before the Assignees (the trustees in bankruptcy) of the Bank could pay anything to the depositors. (This is known as subrogation, under which the Assignees of the bank now owed the amount of the tax debt to the sureties, who had paid the Crown, instead of to the Crown. The Court of Exchequer gave the sureties all the Crown’s remedies for collecting the debts, including Writs of Extent.) But more surprisingly, given the figures, the sureties recovered the whole of what they paid on account of Henry’s liability:8 see the nil balance in the row Sureties’ payment ultimately unrecovered both for Henry and the Bank. The sureties were left solely with part of the costs they had incurred in collecting the assets: £447 for the Bank and £1,779 for Henry, amounting in total to £2,226 (11% of their original payment). The important qualification italicized above—taking a long-term view—signifies that it took twenty-five years for the sureties to recover the whole of their payment, with assets being collected throughout this time. The greater loss to the sureties was the loss of income between paying the Crown and making the recoveries, which I estimate below at over £12,000 over the period 1818 to 1841, an average of £515 p.a. (The reason for the long, twenty-five-year period for the recoveries is dealt with below under the heading Why did it take so long for the sureties to recover the balances?)
The full essay, which includes a more detailed explanation of the figures in Table 1, along with background information, is available in the PDF, which you can download here.
1In general, I shall give figures in pounds only. If there is a list of figures, the shillings and pence are used to calculate the total of those items, and then I shall merely include the pounds without rounding; thus the Tables will not cast exactly but will be correct within a pound or two.
2A possible exception, which I have been unable to trace, is that Clive Caplan mentions an intriguing entry under Works Cited: “Corley, Tony: ‘A Detailed Analysis of Austen & Co’s financial collapse,’ unpublished manuscript. Historic Manuscripts Commission (1934) 78, iii, 324” (“Banker Brother” 90); the year is certainly wrong as Corley was then aged eleven, and I have been unable to find anything corresponding to the reference, which may be a conflation of two items. I am grateful to Professor Mark Casson, Chair of the Business Enterprise Heritage Trust, which holds Corley’s academic papers, for searching for this manuscript and confirming that it is not included among these papers. I am also grateful to Corley’s son, Felix Corley, for searching unsuccessfully for it among his father’s papers. I must accept that I may have duplicated some of Corley’s work, but I am confident that I have unearthed material that neither Corley nor Caplan, who had access to Corley’s manuscript, ever mentioned in their writings, including the sureties’ twenty-three years of accounts in the Hampshire Record Office. While Caplan refers to three boxes in the TNA E 144 series relating to Writs of Extent (one of which is now unfortunately missing), I shall refer to eleven (after going through thirty-five), the Answer to Gray’s Assignees’ claim in Chancery in Kidd v Austen in TNA C 13/1707/39, and the dates of payments of tax to the Exchequer. I should be grateful to hear from any reader who can locate Corley’s unpublished manuscript; it will be interesting to compare our analyses.
For more on this topic see E. J. Clery; Caplan in “Lord Moira’s Debt,” “The Missteps and Misdeeds of Henry Austen’s Bank,” and “We Suppose that the Trial is to Take Place This Week”; T. A. B. Corley’s “Jane Austen and Her Brother Henry’s Bank Failure” and “The Austen Family, the Grays and the Baverstocks”; Markman Ellis; Stuart Bennett; David Gilson; Jane Hurst; Fiona Martin; and John Avery Jones. Where, in the light of further information that I have obtained, I have major differences of view with authors, I have indicated this.
3Table 1 splits the recoveries according to whether these were paid out of the Bank’s or Henry’s assets, and costs are attributed to accordingly. For that reason, the liability to the Exchequer is split as to £22,743 to the Bank (the amount deposited there in the Receiver’s account, for which the partners, Henry, Maunde, and Tilson, were liable), and as to the balance to Henry (even though Henry was liable for the whole amount). Although this distribution is not the legal position, it gives a clearer picture because it matches the liability with the assets used to pay it. In practice, the Crown went against joint assets before individual assets. In relation to the Bank, that might have applied only to Tilson’s and Maunde’s assets (Report of the Select Committee on the Mode of Issuing Extents in Aid, 11 July 1817 HC 1817 505: 47 [Cited as Extents Report or Extents Evidence]). See the Appendix for further details of how the split was made.
4References to the Bank (with a capital) are to the bank partnership of Austen, Maunde and Tilson including its predecessors: H. T. Austen & Co (February 1801: parenthetical dates are the earliest reference to each partnership in Le Faye’s Chronology, so they will date from before February 1801); there was an agreement of 23 November 1801 in which Major James was an undisclosed partner dealing with brokerage of army commissions and half-pay agency (Hampshire Record Office [HRO] 28A11/B12); Austen and Maunde (20 May 1803), which must be a different partnership from the one with James, whose name was undisclosed as that partnership did not include general banking business; Austen, Maunde and Austen (24 October 1806), the second Austen being Frank); Austen, Maunde, Austen and Tilson (27 April 1809); Austen, Maunde and Tilson (5 April 1813, but Frank is believed to have retired on 25 December 1810).
5I have traced an allocation of £3,158, comprising £2,004 of 1814 assessed taxes, £251 of 1814 income tax, and £903 of 1815 assessed taxes paid on unknown dates; there must be a missing £75 to make up to the figure in Table 1, which is necessary to arrive at the figure the sureties paid.
6This figure is recited in the Court Order of 17 April 1818 in which Edward Knight and James Leigh-Perrot’s executors took over the Crown’s remedies.
7Caroline Austen, writing in the early 1870s, put the figure at £30,000 paid in 1816 (47), but they did not pay until 1818; Corley gives a higher figure on the basis that they paid the whole tax debt of £44,445 (“Bank Failure” 147). Corley’s calculation was made on the basis that four payments totalling £21,248 between 1816 and 1817 had been made by the sureties, which I shall demonstrate was not the case (see the heading below: Recoveries before the sureties were called upon to pay).
8They were able to do so only because in 1837 one of Henry’s brothers, Francis Austen (“Frank”), paid the sureties £2,131 for three of Lord Moira’s bills of exchange (see the heading below: The Earl of Moira’s bills of exchange).