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Bankruptcy, Bankruptcy UK or Personal Bankruptcy.
The
Sudeley Bankruptcy and its
Contemporary Significance
Few families
can compare to our own for antiquity. We are descended from Charlemagne, the Saxon Kings
of England and the Dukes of Normandy. The first of our line to settle in England
before the Conquest was Edward the Confessor’s nephew, Ralph, Earl of Hereford.
Amongst his estates was Toddington in Gloucestershire which remained with us for nearly
1,000 years. At the end of the last century, apart from 6,000 acres at Toddington,
we had 18,000 acres at Gregynog in Powys, now part of the University of Wales. In
the “Sudeleys: Lords of Toddington” Dr. Stanley Chapman of Nottingham University
tells us that, whatever the debt my great-great grandfather, 4th Lord Sudeley, accumulated
through the agricultural depression, it was covered twice over by large assets.
Nevertheless in 1893 Lloyds Bank filed for bankruptcy to force the immediate payment of
the debt on the nail. Back of that lies my exceptional discovery at the Public
Record Office that under 4th. Lord Sudeley’s Deed of Agreement with his creditors,
shortly afterwards overturned by Lloyds Bank filing for bankruptcy, they doubled their
claims. Back of that lies a recent letter to me from the Editor of the London
Miscellany, Christopher Arkell, who is an accountant specializing in tax. In his letter he
writes that creditors have been known to enlarge their claims fraudulently where they are
in collusion with outside parties. They are thus enabled to acquire the debtor’s
assets at an under-value. Whatever is to happen in our case, when there is no
Statute of Limitations to bar after any period of time the recovery of property taken by
fraud, and the problems there may be actually to show fraud did occur, Arkell recommends
that quickly, before my possible extinction as a hereditary peer, I should introduce a one
line Bill in the House of Lords to stop the abuse of which he complains by insisting that
creditors’ claims are adequately audited.
To follow will
be a volume I am getting together on what else our case shows to be wrong with the law on
bankruptcy. A further Bill could be introduced in the House of Lords drawing on the
recommendations of the papers in this volume. A Law Lord, Lord Lloyd of Berwick, has
offered to check over the Bill’s drafting.
In this paper
I thought I would begin with an outline of our ancestral inheritance; then give a very
long biographical sketch of the 4th. Lord Sudeley, to show the kind of man he was who had
to go bankrupt; then give signposts of where the papers in my volume might suggest, in the
light of our case, the law on bankruptcy need be changed.
What of 4th.
Lord Sudeley’s ancestral inheritance? The history of Toddington is so rich I
can only pick out a few details up to the end of the 18th. century: apart from our being
of royal descent on both English and Saxon sides, the lucky accident of our going through
a minority at Hastings, so the matter was never tested of which side he would have been
on; if on the English side we would have been dispossessed; our murder of Becket when, in
his dispute with the King, Henry II knew his canon law better than Becket ever did; how
the Church, unable to shed blood, exceeded its instructions in burning the corpse of the
Protestant Sir William Tracy, an irregularity which became a powder trail of the
Reformation; and our acquisition near Toddington of the monastic properties of Hailes
Abbey and Stanway.
The last Lord
Tracy of Toddington married a Weaver from Morville in Shropshire, related to the Blayneys
of Gregynog since Authur Blaney’s mother was a Weaver, Anyone familiar with the
history of Gregynog will know the magnificent sketch of Authur Blayney by his friend
Philip Yorke of Erthig in Philip Yorke’s “Royal Tribes of Wales” to which
Authur Blayney belonged: how he read law not so as to become a lawyer, but to protect
himself against the chicanery of lawyers; politically he belonged to no party except
that of honest men, so would not go near the court because it had been contaminated by
lords and placemen; staying always in Montgomeryshire, his table was stocked with the
ducks and chickens of his poor neighbours even if he did not need them; his hounds were so
overfed the huntsmen were compelled to help them over obstacles they were not in any
condition to clear with ease; and on his death he was buried according to the instructions
he had written out in his own hand, that his coffin should be made in the simplest manner,
the more perishable the material the better. When the Weavers came to an end, Author Blayney inherited Morville; and on his death as a bachelor in 1795 he left both Gregynog
and Morville to the last Lord Tracy as his next of kin.
The last Lord
Tracy died in 1797. In 1798 his only child and heiress married her close cousin
Charles Hanbury, third son of the Hanburys of Pontypool in Gwent. Charles Hanbury
enlarged his name to Hanbury -Tracy, and was created Lord Sudeley at Queen Victoria’s
Coronation largely because he was Chairman of the Commission for the Rebuilding of the
Houses of Parliament which selected Barry’s design. The Hanburys go back a long
way to the 12th. century, living at Hanbury in Worcestershire as Bailiffs to the Bishop of
Worcester and MPs in the medieval House of Commons. In the Tudor period Richard
Hanbury rose to greater wealth and eminence, being Prime Warden of the Goldsmiths Company
and acquiring the ironworks at Tintern Abbey. In the 17th century the Hanburys
greatly enriched themselves with their ironworks, innovating the manufacture in this
country of tin plate and iron wire.
1st. Lord
Sudeley became Chairman of the Commission for the building of the Houses of Parliament
because he had personally designed a new home at Toddington which is very similar, the
same blend of picturesque and Perpendicular Gothic styles, and sometimes called a queer
sort of cathedral. As a picturesque building Toddington is made by its Great Tower,
modelled on the tower at Magdalen College Oxford. The three blocks of which the
building is composed, the main block with the Great Tower, the second block for the
servants and then the stables are asymmetrically disposed so that all the masses shift and
interchange according to the angle from which the Great Tower is approached, giving the
quality in architecture which the 18th century called movement. True to
Ruskin’s precept, that the essence of architecture is ornament, Toddington is rich in
sculpture, and being of the Regency period, the Camden Society and the Ecclesiologists,
this sculpture is secular in tome. Over the entrance is carved our murder of Becket and
the dissolved monasteries out of which with the acquisition of Hailes Abbey and Stanway,
we did so well. The building of Toddington was largely paid for by the sale of oak trees
on the Gregynog estate, much needed by the merchant navy before the introduction of
ironclads; and its cloisters had one of the outstanding collections of Swiss glass in
Europe, formed by 2nd. Lord Sudeley who married Emma, daughter of George Hay Dawkins
Pennant who built Penrhyn Castle in the Revival Norman style out of the profits of
his sugar plantations worked by slaves in the West Indies and the slate quarries near
Penrhyn. Emma and her sister Juliana, later 1st. Lady Penrhyn, were known as Sugar
and Slate, to indicate the sources of their prospective inheritances.
The Morville
estate was sold by 1st. Lord Sudeley in 1814 to enable him to enlarge Gregynog, I think a
wise move economically, since he had been instrumental in the completion of the
Montgomeryshire Canal, enabling the transport of lime and manure for the soil and of shale
for the construction of roads when previously much of the transport in this very
backward area had been on sledges, with the result of a great increase in the price
of land in Montgomeryshire. Far too little is known about our rebuilding of Gregynog in the 19th. century and laying out of the grounds, the names even of the
architect and landscape gardener have eluded us, though the Nesfields, father and son, are
plausibly suggested. I am glad we kept the old Carved Parlour, giving the heraldry
of the Blayney ancestors, to reflect a genealogy partly real, but also conventional where
the descent of the Blayneys is given from Brochwel Ysysthrog, Dark Age King of Powys.
The 4th. Lord
Sudeley was born to the old inheritance I have just outlined in 1840 as a younger son,
Charles Hanbury-Tracy, and it is as such I will refer to him for a while. He joined
the Royal Navy at the age of 14. In those days you had no preliminary training
ashore but went straight to sea, and he quickly saw action under fire in the Crimean War
with the taking from Russia of the Aland Islands in the Baltic. Thereafter he served
on a long commission on a sailing frigate, HMS Amethyst, which took him to nearly
every part of the world. In 1857 he saw action at Fatshan Creek, near Canton, where
the Chinese - resisting Western encroachments in what came to be called the Opium War -
had massed more than 100 junks which our navy set out to destroy. After this
practical training, he won distinction in gunnery courses at Portsmouth, which led to his
appointment as gunnery lieutenant on HMS Shannon. A year later, in 1863, his naval
career was cut short by the death of his father 2nd. Lord Sudeley. He became Whig or
Liberal MP in the House of Commons representing Montgomery Boroughs, and began his
long-standing connection with the Welsh woollen industry at Newtown near Gregynog.
When he inherited the peerage in 1877, his seat in the House of Commons was taken over by
his younger brother Frederick Hanbury-Tracy, until Frederick was ousted at the time of our
bankruptcy by our competitors in the woollen industry, the Pryce-Joneses, haberdashers,
very clever with their colours, who innovated mail order and were Conservatives. Our
seat in the House of Commons and involvement in the Welsh Woollen industry must, I think,
be taken together because the seat was marginal, and I suspect sustained through the
woollen industry providing employment in the area. The effects of the Great Reform
Bill of 1832 were superficial. Seats in the House of Commons continued to be
supported by financial influence up to the introduction of the secret ballot and the
elimination of corrupt practices at elections when, after the introduction of a more
universal franchise, everyone found the election of 1880 to be far too expensive.
Regard must also, I think, be had for the need 4th. Lord Sudeley felt during the
agricultural depressing to provide a market for the goods of his tenants on the Gregynog
estate who were mostly sheep farmers when mechanisation had knocked the home woollen
industry on the head Certainly 4th. Lord Sudeley’s losses in the woollen
industry were very large, amounting by the time of his bankruptcy in 1893 to
£100,000. Some of the story is told in the “Outline of the Welsh Woollen
Industry” written by the late Maurice Richards for the late Peter Lewis’s
textile museum in Newton. Let me quote from a letter written to me by Peter
Lewis before he died expressing his view of why 4th. Lord Sudeley lost so heavily:
“As a
fellmonger in Newton for many years”, Peter Lewis said, “I know how difficult it
would be to ensure adequate supplies of raw material - sheep are shorn only once a year -
and yet even a small mill needs a regular supply of wool weekly. I can quite imagine
how a titled family at Gregynog would have found it difficult to realise the need for the
wool to arrive at the mill when expected. It is of prime importance to keep up sales
of woollen articles to customers.”
Why did
Charles Hanbury -Tracy, later 4th Lord Sudeley, sit in the House of Commons as a Liberal
or Whig? In his own private memorandum on representation in Montgomeryshire he said
all the small farmers were Nonconformists, and a Tory candidate would stand little chance
because he would be opposed to Disestablishment of the Welsh Church. Whiggery,
however, was also in the tradition of Charles Hanbury- Tracy’s family. Before
his elevation to the peerage 1st. Lord Sudeley had sat in the House of Commons as Whig MP
for Tewkesbury. But clearly the belief of old Whig aristocracy like ourselves in
reform was limited. In his book on the decline and fall of the British aristocracy,
David Cannadine says the old Whig aristocracy espoused reform to exercise a restraining
hand over it. And indeed, if we look at the string course round the main block at
Toddington of the heads of all the kings of England from William the Conqueror to Henry
VIII we are left to guess that au fond 1st. Lord Sudeley was a Young Englander or High
Tory. It is easy to see how infuriating such an approach to politics was to the
middle class Radical wing of the Liberal Party headed by Joseph Chamberlain, and the
bitter divisions within the Liberal Party which ensued. When Gladstone changed his
mind in favour of Irish Home Rule in 1886 the Whigs disappeared. Joseph Chamberlain
brought many of them into the Conservative Party, though rather unusually 4th. Lord Sudeley stayed behind as a Liberal Unionist.
IV
Five years
after his entry into the House of Commons, in 1868, Charles Hanbury-Tracy married Ada,
daughter of Frederick Tollemache, who was a younger brother of the Earl of Dysart at Ham
House near Richmond in Surrey, now open to the public, and well known for its ornate
Baroque interior, given to it by Elizabeth, Countess of Dysart’s second husband the
Duke of Lauderdale, member of Charles II’s Cabal and virtual ruler of Scotland for
twenty years after the Restoration. In the 18th.century, Lord Dysart’s son and heir
married Horace Walpole’s niece Charlotte. He approached his father to say that
on getting married he needed more money, to which Dysart replied he had none to give, but
plenty to lend at a low rate of interest. A later Lord Dysart abandoned by his wife
said he did not mind her going, but had noticed she did not say good-bye, which was a
breach of etiquette. 4th. Lady Sudeley’s uncle, Lord Dysart, lived as a hermit
in two rooms in the Strand, reciting Byron to himself, his meals served through a trap
door; so she was brought up at Ham by her father and uncle, Frederick and Algernon
Tollemache, who, in their frugality refused any fires, so their mother chided them gently,
if they caught cold, of dissipating money in doctor’s fees. Frederick
Tollemache was an MP for many years. Algernon Tollemache accumulated a large fortune
of £815,000 out of lending money to settlers in New Zealand, making many of
them into minor gentry; and on his death in 1892, one year before 4th. Lord Sudeley’s
bankruptcy, left half of it to his niece Ada Sudeley.
Let me leave a
vignette of how she appeared to those of my family who knew her when they were
children. Like most of her generation she modelled herself on Queen Victoria, being
dressed in black; and so strict was the attention her generation gave to deportment she
did not seem to walk at all, but to glide on wheels. She gave her husband many
children, three sons including my grandfather, and five daughters. Amongst these,
Aunt Alice married into the Keppel family, Earls of Albemarle, descended from William III’s boyfriend. Aunt Eva married into the Anstruthers, baronets of
Balcaskie. Their illustrious grand-daughter Joyce, under the pen name Jan Struther,
wrote the celebrated book, “Mrs Miniver”, which in its illustration of the
English character helped to bring America into the war. President Roosevelt said
that in its contribution to the war it was the equivalent of 14 battleships. After
the bankruptcy in 1893, when 4th. Lord Sudeley lost everything and much of 4th. Lady
Sudeley’s fortune disappeared under her Guarantee, they retired to Ormeley Lodge near
Ham, till recently the home of the financier Sir James Goldsmith. Brought up as she
had been at Ham, 4th. Lady Sudely looked on Ormeley v
To return to
4th. Lord Sudeley’s political career in the House of Commons till he inherited the
peerage in 1877 and afterwards in the House of Lords where he held office under
Gladstone’s administration in the early 1880s. It was the Prime Minister’s
wish he should become Under Secretary of State for War, but he had to decline because he
was a Director of the firm of Sir William Armstrong and Company which revolutionised naval
gunnery and were large contractors to the Government. A surprising feature of 4th.
Lord Sudeley’s bankruptcy is that he should have lost £60,000 with this firm
when Armstrong was a good businessman who made himself very rich. Instead 4th.
Lord Sudeley represented the Board of Trade and Office of Works on the Front Bench in the
House of Lords which meant attending Queen Victoria as Lord in Waiting. In
considering which Lords in Waiting should accompany her to Osborne in the Isle of Wight,
Queen Victoria said: “Not Lord Sudeley, he is so dull.” Though some of us
may believe that is just what a peer should be, this judgement does seem rather harsh when
4th. Lord Sudeley was a man of such intelligence and vitality, so I should add that on
hearing the news of his bankruptcy, the old Queen is reported to have wept. On the
Front Bench in the House of Lords, Sudeley represented the views of the Government, which
are already well known, so I thought I would concentrate on his Parliamentary contribution
outside office, concerned almost exclusively with what he really knew about, the Royal
Navy. This has to be considered largely against what was wrong with the Navy in being
hidebound by conservatism and resistant to innovation when it had to undergo great changes
in his own lifetime. There were anachronisms in the areas of the promotion and
retirement of naval officers and what they should be qualified to do after the evolution
of ironclads, the introduction of torpedoes and the great advances made in gunnery.
With the reduction of the Navy after the Napoleonic War, there was a blockage in the
promotion lists which particularly affected the senior ranks. The naval lists were
swollen with ageing officers ashore on half pay, and during the Crimean War much
inefficiency resulted because the average age of senior officers was sixty. As an MP
in the House of Commons Hanbury-Tracy was responsible for two Admiralty Orders in Council
of 1873 and 1876 to clear the naval lists by offering many officers a step up in rank and
down payment to retire. And it was very important that those officers who remained
in the navy should be properly trained in current technical advances. This applied
especially to navigation. Previously, whilst the captain had command of his ship,
its navigation was left to the Master. Together with Lord Brassey when he was an MP,
Hanbury-Tracy worked successfully in the House of Commons to put an end to this by
bringing navigating lieutenants up to the same standards as gunnery and torpedo
lieutenants.
It is to be
lamented that Sudeley could plead only once in the House of Lords for the
extension of leave for naval officers on foreign service. If bankruptcy and
the temporary loss of his seat in the House of Lord had not intervened, he would have
brought the subject up two or three years in succession, and probably a large concession
would have been made.
VI
The 4th. Lord
Sudeley’s economic problems originate in the difficulties of owning land from the
onset of the agricultural depression in 1879. I would like to set this matter in a
rather longer perspective, from the Repeal of the Corn Laws in 1846 up to the Depression
of the 1930s. From its inception in the reign of Queen Elizabeth the British Empire
worked under the Mercantile System, that is to say exchange of raw materials from the
colonies for our manufactured products. Then Peel betrayed his own Conservative
Party by repealing the Corn Laws and we went over to Free Trade. Sometimes it is
supposed the Corn Laws were repealed to relieve the potato famine in Ireland. But in
his biography of Disraeli Lord Blake makes it clear that Ireland was so impoverished it
would make little difference if the Corn Laws were repealed or if they were not; Peel
acted as he did because he was a committed Free Trader under the influence of Cobden, who
was very prejudiced against the old landed aristocracy. The ensuing sentence of
death against agriculture was delayed for a generation. Then disaster struck in 1879
when British farming was not able to compete with wheat grown on the virgin soil of
the American prairies, the import of refrigerated meat from the Argentine, and the import
of butter and wool from New Zealand. Thence forward it was impossible to hold an
estate together without support from an outside source. In consequence, if I can
give a few statistics, by 1914 Britain’s farmland population fell by a quarter and
the rural population as a whole by a third. Already by 1903 over 5 million acres of
farmland had simply passed out of cultivation. Many working on the land were forced
unemployed into towns or had to emigrate. In his book on the Decline and Fall of The
British Aristocracy David Cannadine has written of other old landed families like
ourselves which carried on, despite the agricultural depression, and before the
introduction of social security, to keep their tenants afloat but at great cost to
themselves. I will cite the single case of the 9th. Duke of Bedford, with whom the
4th. Lord Sudeley had a thriving correspondence.
The wittiest
of men, the Duke seasoned his correspondence with quotations from his great store of
knowledge from the classics and the Vulgate, the quotations often being used in a manner
most remote from their original meaning. In his obituary, Jowlett said he was one of
the finest gentlemen in Europe. Having lived as one of the poorest men in England,
with an income of £22 p.a., he became one of the richest, with an income of
£200,000 p.a., yet retained the simplicity of a poor man, who rather than value himself
for his good deeds preferred to apologise for them, and liked to lament that his days were
passed in carrying out the duties of a land agent. During the agricultural
depression he spent £2 million on improving his estates without increasing the rents.
Being in quite a different league of wealth to 4th. Lord Sudeley, he could afford it.
In the face of
the competition of agricultural produce from overseas nearly every other country in Europe
introduced Protection, most notably Prussia where out of his customs duties Bismarck
paid for his innovation of social security. Free Trade was the doctrine of the
Liberal Party; why did the Conservative Party also keep to it? This was partly
because when Gladstone changed his mind in favour of Irish Home Rule many Liberals drifted
into the Conservative Party; cuckoos in the Tory nest they have been called who changed
the philosophy of the Conservative Party from within. More to the point, the
enlargement of the franchise under the Second and Third Great Reform Bills made it
impossible to increase the price of food. Any Government which did this would be
voted out of office at the next election. Here was the basic cause of the failure of
Joseph Chamberlain within the Conservative Party now in his advocacy from 1903 of domestic
protection for agriculture as well as industry and Imperial Preference. Only with
the mass unemployment of the 1930s were the Conservatives able to introduce the measures
advocated by Chamberlain thirty years before.
The way out
for landlords from their awkward situation in which they should never have been placed
would have been for their tenants to enfranchise, as happened in Ireland.
Compensation for Irish landlords under Wyndham’s Land Act of 1903 was quite
generous. Amongst Conservative politicians Lord Onslow and Lord Landsdowne
recommended the use of state credit to assist tenants to buy out their own holdings.
The movement for tenants in Wales to enfranchise was strong, and I am puzzled 4th Lord
Sudeley should have joined the North Wales Property Defence association, founded by his
cousin Lord Penrhyn, and designed to resist that movement.
Whatever
Gladstone may have said in criticism of Welsh landlords and their lack of generosity
during the agricultural depression in his famous speech at the foot of Mount Snowdon in
1892, and following on that his appointment of a Royal Commission of Welsh land, 4th Lord Sudeley’s record at the Gregynog estate was an exceptionally good one. When he
inherited in 1877 the estate was very dilapidated. At the celebration of my Great
Uncle Charles Hanbury-Tracy, later 5th. Lord Sudeley’s coming of age there in 1891
and before, tribute was paid to 4th Lord Sudeley’s abatements of rent, and all he had
spent on drainage and the provision of new houses fit for his tenants to live in. It
was fully recognised that without such a generous landlord many on his Gregynog estate
could not have remained his tenants and might have been ruined.
After his
bankruptcy in 1893 4th. Lord Sudeley went out to New Zealand, no doubt to check over
property his wife had inherited from Algernon Tollmache, and saw how out there any money
spent on improvements got its proper return. Writing to his wife, he expressed
bitterness over how, owing to the agricultural depression, all the money he had spent on
improving his estates in Gregynog and Toddington did not have that effect.
The 4th Lord
Sudeley clearly saw the need to diversify to try to overcome the difficulties of the
agricultural depression. The Royal Commission appointed in 1893 to inquire into the
agricultural depression confirmed that fruit farming had been profitable; so we may be
sure Sudeley did just what was needed in becoming an important pioneer in the fruit
industry. He booked an order with George Bunyard, the leading supplier of fruit
trees in Kent, for half a million trees and bushes, claimed to be the largest order ever
placed by a British nurseryman. Planting began in 1879/80. The earliest
planting were plums, with a currant underplant. 50 acres were also planted with
cobnuts. By 1890 the total area of fruit and nuts was 650 acres, probably the
largest fruit plantation in Britain at the time.
For the
growing of fruit under glass Sudeley erected houses of modern, metal frame
construction. The steelwork was imported from Belgium, with Belgium workers brought
over to complete their erection. The total area of glass was about two acres, and
the principal crops here were grapes, peaches, nectarines and figs.
Sudeley showed
equal foresight in the disposal of his fruit. In about 1887 he entered into
partnership with T.W.Beach, leading jam maker; since strawberries and other soft fruit, as
well as plums, could become much more profitable, especially in glut years, if made into
jam on site. And new processes of canning fruit were developed. In the
disposal of fruit Sudeley’s influence was immense. The Beach family built canning and
jamming factories in Pershore and Evesham, and many others followed suit. Sudeley’s tragedy was that he could not hold onto his orchards for long enough till
they came into full bearing owing to his misfortunes in the City.
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