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Decisions of the Superior Courts of New South Wales, 1788-1899

Thompson v. McCarthy [1804] NSWKR 1; [1804] NSWSupC 1

promissory note - imprisonment for debt, false imprisonment

Court of Civil Jurisdiction

Atkins J.A., 10 February 1804

Source: Sydney Gazette, 12 February 1804, 2 [1]

During the late sittings a cause was brought before the court in which the auditory appeared sensibly interested, and all but the defendant equally satisfied at the verdict granted.

This was a suit George Thompson versus Dennis McCarthy, brought to recover a sum of ¿30 that being the amount of a promissory note of hand granted by the plaintiff upon certain conditions that were not complied with, but upon the non-payment of which he had been arrested in 1801, and from that time to the present period suffered imprisonment. The hardships the unfortunate man has endured, and the general belief of his having fallen a sacrifice to the artifices of crafty ingenuity, have long excited sympathy and commiseration; and from the following consternation of circumstances that transpired in the course of the trial, we are sorry that we cannot hope to do justice to the iniquity of the transaction, or the sentiment of indignation that prevailed throughout the trial.

Between three and four years since the plaintiff, the defendant, and one Reeves were in custody of the Provost Marshal at the same time; the latter upon a debt jointly contracted by himself and the defendant; and he being a man who was well acquainted with agriculture, and likely to be found serviceable to the plaintiff (Thompson), proposal was made to him by McCarthy, of obtaining Reeves' immediate discharge provided he, the plaintiff, would give him his note for ¿30, declaring at the same time that what he did was merely for the accommodation of the plaintiff, who was in immediate want of a man of this description upon his farm. The plaintiff acceded to the proof, and granted his note to the defendant, but upon the express condition that Reeves should be immediately released by virtue of the instrument; he declaring himself willing to enter into the plaintiffs service and continue varying until satisfaction should be made to the full amount. It appeared in evidence, however, that the man had not been released in the manner stipulated for, but that he remained in prison three months after, whereby the intention of the drawer was defeated; and further, that he was not discharged from any exerting of the defendant whatever; wherefore the plaintive considered his note as invalid, and resolved to effect a claim, should any be made upon it.

Either from an unfortunate remissness, or from his total ignorance of commercial concerns, he at the time neglected taking the proper steps for the recovery of the instrument, and the defendant without consulting the legality of the procedure, paid the note away for its full value. It was accordingly presented by another person, and upon refusing to negotiate it a writ was issued against him in 1801. He has ever refused to take the necessary steps to sue for an alimony, and has long been a prey to extreme want.

The defendant attempted to confound the circumstances of this note with that of another, held by him at the time of the transaction, in which Reeves was jointly bound with himself for the payment of ¿31 10s. and called evidence to support his plea, one of whom declared without hesitation, that the said Reeves had been set at liberty by the defendant in consideration of the plaintiff's notes, but at the same time acknowledged himself ignorant how that note had been applied, or in what manner the event of Reeves' liberation had been brought about; whereas upon the plaintiff's side it was palpably made to appear that the instrument had been obtained upon consideration of Reeves' immediate releasement, in order that he might proceed to the cultivation of the plaintiff's farm; that he had been kept in confinement three months after; and finally that this very honest defendant had no share in his dismissal whatsoever.

As much ingenuity had been employed to conceal the truth, so was every attention requisite to unravel the mystical transaction. It was, however, sifted to the very bottom, and the only question remaining for the consideration of the court was, whether the defendant had not acted illegally in paying away a note obtained upon a certain condition that had not in any shape being complied with, and if so, whether he was not now responsible to the drawer. After some deliberation the court found a verdict for the plaintiff.

Note

[1] Indebtedness was immensely risky for both creditors and debtors in early New South Wales. The first risk came about because there was little sterling in circulation. As a result, promissory notes were frequently issued. Those notes were negotiable instruments, spreading the risk of non-payment from person to person. Secondly, when a debtor failed to pay a judgment debt the First Charter of Justice provided only two remedies: the seizure and sale of goods ( fieri facias) and imprisonment for debt (capias ad satisfaciendum).

In this extraordinary case, three debtors were sent to prison. Thompson issued a ¿30 note to secure the release of Reeves from debtors' prison so that Reeves could work on Thompson's farm. The note was conditional on Reeves' release from prison, which did not happen. The note was passed to McCarthy who negotiated it on to another person, who finally sued Thompson on it. Thompson was imprisoned for three years, the longest period of imprisonment for debt in this stage of the colony's history.

In this case, Thompson sued McCarthy successfully for selling the note in breach of the condition. Thompson was released from prison and McCarthy was held liable. He then sued Reeves and won.

See Kercher, Debt Seduction and Other Disasters: the Birth of Civil Law in Convict N.S.W., 141.

Published by the Division of Law, Macquarie University