Sunday, May 13, 2012

More on Goldsmiths’ Notes and the Act of 1704

In the Promissory Notes Act of 1704, the British parliament defined the legal status of bankers’ or goldsmiths’ notes, and granted to them the same status as bills of exchange:
“Bank notes are frequently referred to in our Acts of Parliament, as ‘Bankers’ or Goldsmiths’ notes.’—In the Act of 1704, which removed all ‘doubts’ as to their legality, they are mentioned as ‘notes made and signed by any person or persons, body public or corporate, or by the servant or agent of any corporation, banker, goldsmith, merchant, or trader.’ Even the notes issued in Ireland were called goldsmiths’ notes. By an Act of the Irish Parliament passed in 1709, ‘notes issued by any banker, goldsmith, merchant, or trader, whether payable to order or bearer, were rendered assignable and indorsable over as inland bills of exchange.’ ....

After the establishment of the Bank of England in the year 1694, the notes of that corporation superseded the goldsmiths’. The business of banking, too, became gradually separated from that of a goldsmith, though we learn from a speech delivered in Parliament, in the year 1746, that most of the Loudon bankers were at that time members of the Goldsmiths’ Company.” (Gilbart 1854: 290).


Allen, L. 2009. The Encyclopedia of Money (2nd edn.), ABC-CLIO, Santa Barbara, Calif. and Oxford, England. 179-180.

Commons, John R. 1968. [1924] Legal Foundations of Capitalism, University of Wisconsin Press, Madison.

Gilbart, J. W. 1854. “The Laws of the Currency, as exemplified in the Circulation of Country Bank Notes in England, since the Passing of the Act of 1844,” Journal of the Statistical Society of London 17 (December): 289-321.

Rogers, James Steven. 2004. The Early History of the Law of Bills and Notes: A Study of the Origins of Anglo-American Commercial Law, Cambridge University Press, Cambridge.

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