[The war of the Spanish succession, concluded by the treaty of Utrecht, 1713.]
CHAPTER VII
OF THE TRADESMAN IN DISTRESS, AND BECOMING BANKRUPT
In former times it was a dismal and calamitous thing for a tradesman to break. Where it befell a family, it put all into confusion and distraction; the man, in the utmost terror, fright, and distress, ran away with what goods he could get off, as if the house were on fire, to get into the Friars[14] or the Mint; the family fled, one one way, and one another, like people in desperation; the wife to her father and mother, if she had any, and the children, some to one relation, some to another. A statute (so they vulgarly call a commission of bankrupt) came and swept away all, and oftentimes consumed it too, and left little or nothing, either to pay the creditors or relieve the bankrupt. This made the bankrupt desperate, and made him fly to those places of shelter with his goods, where, hardened by the cruelty of the creditors, he chose to spend all the effects which should have paid the creditors, and at last perished in misery.
But now the case is altered; men make so little of breaking, that many times the family scarce removes for it. A commission of bankrupt is so familiar a thing, that the debtor oftentimes causes it to be taken out in his favour, that he may sooner be effectually delivered from all his creditors at once, the law obliging him only to give a full account of himself upon oath to the commissioners, who, when they see his integrity, may effectually deliver him from all further molestation, give him a part even of the creditors' estate; and so he may push into the world again, and try whether he cannot retrieve his fortunes by a better management, or with better success for the future.
Some have said, this law is too favourable to the bankrupt; that it makes tradesmen careless; that they value not breaking at all, but run on at all hazards, venturing without forecast and without consideration, knowing they may come off again so cheap and so easy, if they miscarry. But though I cannot enter here into a long debate upon that subject, yet I may have room to say, that I differ from those people very much; for, though the terror of the commission is in some measure abated, as indeed it ought to be, because it was before exorbitant and unreasonable, yet the terror of ruining a man's family, sinking his fortunes, blasting his credit, and throwing him out of business, and into the worst of disgrace that a tradesman can fall into, this is not taken away, or abated at all; and this, to an honest trading man, is as bad as all the rest ever was or could be.
Nor can a man be supposed, in the rupture of his affairs, to receive any comfort, or to see through his disasters into the little relief which he may, and at the same time cannot be sure he shall, receive, at the end of his troubles, from the mercy of the commission.
These are poor things, and very trifling for a tradesman to entertain thoughts of a breach from, especially with any prospect of satisfaction; nor can any tradesman with the least shadow of principle entertain any thought of breaking, but with the utmost aversion, and even abhorrence; for the circumstances of it are attended with so many mortifications, and so many shocking things, contrary to all the views and expectations that a tradesman can begin the world with, that he cannot think of it, but as we do of the grave, with a chillness upon the blood, and a tremor in the spirits. Breaking is the death of a tradesman; he is mortally stabbed, or, as we may say, shot through the head, in his trading capacity; his shop is shut up, as it is when a man is buried; his credit, the life and blood of his trade, is stagnated; and his attendance, which was the pulse of his business, is stopped, and beats no more; in a word, his fame, and even name, as to trade is buried, and the commissioners, that act upon him, and all their proceedings, are but like the executors of the defunct, dividing the ruins of his fortune, and at last, his certificate is a kind of performing the obsequies for the dead, and praying him out of purgatory.
Did ever tradesman set up on purpose to break? Did ever a man build himself a house on purpose to have it burnt down? I can by no means grant that any tradesman, at least in his senses, can entertain the least satisfaction in his trading, or abate any thing of his diligence in trade, from the easiness of breaking, or the abated severities of the bankrupt act.
I could argue it from the nature of the act itself, which, indeed, was made, and is effectual, chiefly for the relief of creditors, not debtors; to secure the bankrupt's effects for the use of those to whom it of right belongs, and to prevent the extravagant expenses of the commission, which before were such as often devoured all, ruining both the bankrupt and his creditors too. This the present law has providently put a stop to; and the creditors now are secure in this point, that what is to be had, what the poor tradesman has left, they are sure to have preserved for, and divided among them, which, indeed, before they were not. The case is so well known, and so recent in every tradesman's memory, that I need not take up any more of your time about it.
As to the encouragements in the act for the bankrupt, they are only these—namely, that, upon his honest and faithful surrender of his affairs, he shall be set at liberty; and if they see cause, they, the creditors, may give him back a small gratification for his discovering his effects, and assisting to the recovery of them; and all this, which amounts to very little, is upon his being, as I have said, entirely honest, and having run through all possible examinations and purgations, and that it is at the peril of his life if he prevaricates.
Are these encouragements to tradesmen to be negligent and careless of the event of things? Will any man in his wits fail in his trade, break his credit, and shut up his shop, for these prospects? Or will he comfort himself in case he is forced to fail—I say, will he comfort himself with these little benefits, and make the matter easy to himself on that account? He must have a very mean spirit that can do this, and must act upon very mean principles in life, who can fall with satisfaction, on purpose to rise no higher than this; it is like a man going to bed on purpose to rise naked, pleasing himself with the thoughts that, though he shall have no clothes to put on, yet he shall have the liberty to get out of bed and shift for himself.
On these accounts, and some others, too long to mention here, I think it is out of doubt, that the easiness of the proceedings on commissions of bankrupt can be no encouragement to any tradesman to break, or so much as to entertain the thoughts of it, with less horror and aversion than he would have done before this law was made.
But I must come now to speak of the tradesman in his real state of mortification, and under the inevitable necessity of a blow upon his affairs. He has had losses in his business, such as are too heavy for his stock to support; he has, perhaps, launched out in trade beyond his reach: either he has so many bad debts, that he cannot find by his books he has enough left to pay his creditors, or his debts lie out of his reach, and he cannot get them in, which in one respect is as bad; he has more bills running against him than he knows how to pay, and creditors dunning him, whom it is hard for him to comply with; and this, by degrees, sinks his credit.
Now, could the poor unhappy tradesman take good advice, now would be his time to prevent his utter ruin, and let his case be better or worse, his way is clear.
If it be only that he has overshot himself in trade, taken too much credit, and is loaded with goods; or given too much credit, and cannot get his debts in; but that, upon casting up his books, he finds his circumstances good at bottom, though his credit has suffered by his effects being out of his hands; let him endeavour to retrench, let him check his career in trade—immediately take some extraordinary measures to get in his debts, or some extraordinary measures, if he can, to raise money in the meantime, till those debts come in, that he may stop the crowd of present demands. If this will not do, let him treat with some of his principal creditors, showing them a true and faithful state of his affairs, and giving them the
