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Colonial Cases

Oriental Bank Corporation v. Wright

[banking]

Oriental Bank Corporation v. Wright

Judicial Committee of the Privy Council
3 March 1880
Source: The Times, 4 March, 1880

LAW REPORT.
JUDICIAL COMMITTEE OF THE PRIVY COUNCIL, March 3.
(Present - Sir James Colville, Sir Barnes Peacock, Sir Montague Smith, and Sir Robert Collier.)
THE ORIENTAL BANK CORPORATION v. WRIGHT.
  This was an appeal from an order of the High Court of the province of Griqualand West, of the 15th of March, 1877, by which the appellants were required to render to the respondent, Mr. Henry Boscawen Wright, in his capacity as Acting Treasurer of the province, a return of the notes paid out or put into use or circulation by the Kimberley agency of the bank during each month since the 1st of November, 1875, up to the date of the application.
  Mr.  Benjamin, Q.C., and Mr. J. C. Mathew were counsel for the appellants; Mr. Herschell, Q.C., and Mr. R. B. Finlay for the respondents.   The Oriental Bank Corporation, whose head office is in London, have a colonial department at Port Elizabeth, in the Cape of Good Hope, and an agency at Kimberley, on the diamond-fields of Griqualand West.  By a proclamation, dated October27, 1871, and issued by Sir Henry Barkly, then Governor of the Cape of Good Hope, the present province of Griqualand West was declared to be British territory, and it was ordered in effect, that the law and usages of the Cape Colony should be generally applicable to the new province. By the Bank Notes Duty Act, 1861 -  a Cape statute - it was enacted that every stock bank trading as bankers in the colony and issuing bank-notes should be bound to transmit to the Treasurer-General certain monthly returns and to pay certain duties. In 1872 the Oriental Bank Corporation established their agency at Kimberley, but it was alleged that they had not circulated or issued any local notes in the province, but had simply used notes which had been put into circulation from their Port Elizabeth branch, where they were payable, and upon which they had already paid duty in the colony.
  In June, 1876, the respondent, as Acting-Treasurer of Griqualand West, gave notice to the bank branch at Kimberley that the High Court would be moved for an order to compel them to make a return of all notes paid or put into circulation in the province from 1873 to that date.  The motion against the bank, with similar impositions against the Cape of Good Hope Bank and the Standard Bank of British South Africa, was heard at Kimberley on the 15th of March, 1877, before Mr. Barry, the Recorder of Griqualand West, who ordered a return to be made to the Treasurer by the appellants of its own notes outstanding on the last day of November, 1875, and of every succeeding month to the date of the application; and of all notes of the Kimberley agency of that or any other bank which appeared to have been issued in Africa or elsewhere not within the province, and which, having come into the bank, had been paid out or put into use or circulation in the province. From that decision the present appeal was instituted.
  For the Oriental Bank it was argued that the Cape Bank-Notes Duty Act, 1864, had never become part of the law of Griqualand West, but, even assuming it applied to that province, the agency at Kimberley was not a "bank of issue" within its meaning, and had never issued any notes in the province. It was further contended that the Act was not intended to apply to notes on which duty had already been paid at the Cape before being issued in the province, and that, in any case, returns were only to be made by the head office.  Therefore, no claim for the returns in question could be legally made.
  Foe the respondent, it was submitted that the Act of 1864 was a law not inapplicable to Griqualand West and was, therefore, in force there by virtue of the proclamation of Sir Henry Barkly in 1871, which was afterwards ratified by Her Majesty. Under its provisions the Treasurer was entitled to claim the return of notes circulated by the bank in Griqualand West.
  Their Lordships, at the close of the arguments, reserved judgment.

 

Source: The Times, 24 June, 1880

LAW REPORT, June 23.
JUDICIAL COMMITTEE OF THE PRIVY COUNCIL.
(Present - Lord Blackburn, Sir James Colville, Sir Barnes Peacock, Sir Montague Smith, and Sir Robert Collier.)
THE ORIENTAL BANK CORPORATION v. WRIGHT.
[As above.]
.  .  .  
  This case was before the Judicial Committee in March last, and at the close of the arguments their Lordships reserved judgment. It now came before the Court again - Lord Blackburn on this occasion suiting as one of the Judicial Committee - to be re-argued.
.  .  .  
  For the Oriental Bank it was argued that the Cape Bank Note Act, 1864, had never become part of the law of Griqualand West; but, even assuming it applied to that province, the agency at Kimberley was not a "bank of issue" within its meaning, and had never issued any notes in the province. It was further contended that the Act was not intended to apply to notes upon which duty had already been paid at the Cape before being used in the province, and that, in any case, returns were only to be made by the head office. Therefore, no claim for the returns in question could be legally made.
  For the respondent it was submitted that the Act of 1864 was a law not inapplicable to Griqualand West, and was, therefore, in force thereby virtue of the proclamation of Sir Henry Barkly in 1871, which was afterwards ratified by Her Majesty. Under its provisions the Treasurer was entitled to claim the returns of notes circulated by the bank in Griqualand West.   At the close of the arguments their Lordships took time to consider their decision.

Source: The Times, 15 July, 1880

LAW REPORT, July 14.
THE ORIENTAL BANK CORORATION v. WRIGHT.
  This was an important appeal from an order of the High Court of the province of Griqualand West of the 15th of March, 1877, made upon the application of the respondent, Mr. Henry Boscawen Wright, in his capacity as acting treasurer of the province, whereby the Oriental Bank Corporation were directed to make him a return of their own notes outstanding on the 1st of November, 1875, and of all bank notes of the Kimberley agency of the Oriental Bank, or any other bank which, on the face of them, purported to have been issued at or from any place in Africa or elsewhere not within this province, and which, since the 1st of November, 1875, had been paid out or put into use and circulation in the province by the bank. The order was based on an Act of Parliament of the Cape Colony of 1864, "for imposing a duty upon bank-notes," with a view to the collection of the duty chargeable under that Act.
  Mr. Benjamin, Q.C., and Mr. J. S. Mathew were counsel for the appellant; the Solicitor-General and Mr. R. B. Finlay for the respondent.
  The case was originally before the Judicial Committee in March last, and at the close of the arguments their Lordships reserved judgment. Since then it had come before the Court again - to be re-argued. It will be recollected that the Oriental Bank Corporation, whose head office is in London, had a colonial department at Port Elizabeth, in the Cape of Good Hope, and an agency at Kimberley, in the Diamond-Fields of Griqualand West.  By a proclamation, dated October 27, 1871, and issued by Sir Henry Barkly, then Governor of the Cape of Good Hope, on the submission of the Griqua tribes, the present province of Griqualand West was declared to be British territory, and it was ordered, in effect, that the law and usages of the Cape Colony should be generally applicable to the new province. By the Bank-Notes Duty Act, 1864, it was enacted that every joint stock bank trading as bankers in the colony and issuing bank notes should be bound to transmit to the Treasurer-General certain monthly returns and to pay certain duties. In 1872 the Oriental Bank Corporation established their agency at Kimberley, but it was alleged that they had not circulated or issued any local notes in the province, but had simply used notes which had been put into circulation from the Port Elizabeth branch, where they were payable, and upon which they had already paid duty in the Cape Colony.
  In June, 1876, the respondent, as Acting-Treasurer of Griqualand West, gave notice to the branch bank at Kimberley that the High Court would be moved for an order to compel them to make a return of all notes paid or put into circulation in the province from 1873 to that date. The motion against the bank, with similar motions against the Cape of Good Hope Bank and the Standard Bank of British South Africa, was heard at Kimberley on the 15th of March, 1877, before Mr. Barry, the Recorder pf Griqualand West, who ordered a return to be made to the Treasurer  by the appellants of their own notes outstanding on the last day of November, 1875, and of every succeeding month to the date of the application; and of all the notes of the Kimberley agency of that or any other bank which appeared to have been issued in Africa or elsewhere not within the province, and which, having come into the bank, had been paid out or put into use or circulation in the province. From that decision the present appeal was instituted.
.  .   .
  Their Lordships, in giving judgment, held that the objection made by the appellants to the order was fatal - namely, that, assuming the Act for imposing a duty on bank-notes to have been validly extended to the province and to be construed as if the words "Province of Griqualand West" were to be read in it instead of "Colony of the Cape of Good Hope," the Act originally applied only to banks of issue within the colony - that was to say, banks issuing within the colony notes purporting so to be issued and payable; and that the Oriental Bank, though having a  branch at Kimberley, within the province, and there put into circulation notes issued by it in the colony and payable there, did not issue any notes payable in the province, and so was not liable to make any return.
  What the Kimberley branch did was to use within the province notes of their bank dated and payable at Port Elizabeth, in the Cape Colony, and which in every case had been put into circulation and paid bank-note duty in the colony prior to being issued at the branch.
  The primary object of the Bank Note Duty Act certainly seemed to have been to subject banks issuing their own local notes to duty on the notes they issued, but it being, doubtless, foreseen that some banks might also put into circulation notes of their own and of some other bank, which, though not purporting  to be issued in the colony, would still become part of its paper currency, the framers of the statute seemed to have thought that banks of issue which thus increased the paper currency got an advantage thereby, and should be taxed, and they accordingly introduced a clause to meet such cases, and to bring within the scope of the Act all notes, except Bank of England notes, thus put into circulation by banks so carrying on business in the colony.
  The question was whether, though the description in that clause was "Every joint-stock bank carrying on business as bankers in the colony," without the words, "and issuing bank-notes" found in Section 1, that description was not by implication confined to the banks pointed at in Section 1.  The position of a bank putting forth only such notes as were described in the 10th section, without any of its own local notes, would seem to have been unprovided for by the Act.  Their Lordships, therefore, having regard to the rule that the intention to impose a charge on the subject must be shown by clear and unambiguous language, were unable to say that the obligation of the bank to make the return applied for and its consequent liability to pay duty on the notes put into circulation by its Kimberley branch were so clearly and explicitly imposed as to satisfy that rule. That view of the Act appeared to have been for a long time acted upon by the Government of the province, for having made a claim for duty they expressly withdrew it, renewing it only after an interval of two years. That limited operation of the Act undoubtedly entailed the consequences pointed out by the learned Judge of the High Court of Griqualand West - namely, that duty would be payable on all notes described in the 10th section when put forth by banks which issued any notes purporting to be locally issued, put into circulation, within the province, their own notes, issued in London or elsewhere, however large the amount so put into circulation might be. But if the Legislature had omitted for some reason or other to provide for such a case, it was the province of the Legislature itself, and not of the Court, to supply the omission. Their Lordships would, therefore, humbly advise Her Majesty to discharge the order of the High Court and to direct that the respondent's application be dismissed. The appellants would have the costs of the appeal.

Published by Centre for Comparative Law, History and Governance at Macquarie Law School