USA > Vermont > Records of the Governor and Council of the State of Vermont, Vol. V > Part 59
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Appendix D.
branches, the one at Woodstock, in the county of Windsor, and the other at Middlebury, in the county of Addison, and such other branches as the legislature of this state shall, from time to time, direct and establish. And all the stock in said bank, and all the profits arising therefrom, shall be the property of this state; and be under the sole direction and disposal of the legislature of this state forever.
SEC. 2. And it is hereby further enacted, That there shall be chosen annually, by ballot, by both branches of the legislature, in joint commit- tee, thirteen suitable persons to be directors of said bank, who shall have power, when convened, to choose from among themselves one person to be president of said bank, who shall have and exercise all the power proper and necessary for a President of a bank. And the President and Directors of said bank, for the time being, and their successors forever, shall have power, by the name and stile of The President and Directors of the Vermont State Bank, to prosecute, for the benefit of this state, any action or suit, upon any contract, or for any cause which shall concern the said bank. And the said directors shall reside, six in the two cast- ern, and six in the two western districts of this state,1 and the other where prudence may dictate. And they shall be commissioned by the Governor of this State annually. And a majority of them shall be a quorum to transact any business incumbent on them as directors of said bank.
SEC. 3. And it is hereby further enacted, That the directors who re- side in said eastern districts shall be the directors of the branch estab- lished at said Woodstock. and the remainder thereof shall be the directors of the branch established at said Middlebury. And four of the directors of each branch shall be a quorum to act upon those matters which concern such branch only. Provided, That the President of said bank shall have a right to set [sit] equally, as one of the directors of each branch.
SEC. 4. And it is hereby further enacted, That the majority of all said directors, when met, shall also have power to appoint a cashier to each of said branches, also a clerk if necessary. And to make and establish such rules, with regard to the days and hours when said bank shall be open to transact business; and with regard to any other matter, for the well ordering of said bank, as they shall deem proper, and not repug- nant to the Constitution, or any law of this state.
SEC. 5. And it is hereby further enacted, That the directors of each branch of said bank shall have discretionary power to borrow money from time to time, to fill the vaults of such branch, on the credit of such branch only. Provided, however, that they shall not give a greater in- terest than at the rate of six per cent. per annum.
SEC. 6. And it is hereby further enacted, That all bank bills issued by said bank shall be signed by the president thereof, and countersigned by the cashier of the branch at which said bills respectively shall be paya- ble. And the directors of either branch shall not, at any time, issue or put in circulation bills to a greater amount than the actual sum of the deposit of silver, gold, and copper coins, in the vault of such branch, until the deposit shall amount to twenty-five thousand dollars; after which they may put in circulation bills to three times the amount of such deposit. Provided, said deposit shall not at any time exceed three hundred thousand dollars.
SEC. 7. And it is hereby further enacted, That there be, and hereby is appropriated a sum not exceeding five hundred dollars, which the Treas- urer of this state is hereby directed to pay to said directors, for the pur- pose of procuring plates and paper, necessary for the use of said bank,
1 Meaning Congressional districts.
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in issuing bills as aforesaid. And after the same shall be procured, as aforesaid, the legislature may, from time to time, appropriate any monies, or sums of money, as they shall see fit, to fill the vaults of said branches of said bank, or of any other branches thereof, which said legislature may hereafter establish.
SEC. S. And it is hereby further enacted, That cach director of said bank shall, before he enters upon the duties of his office, give a bond, with four or more sureties, frecholders within this state, to the treasurer of this state, in the sum of thirty thousand dollars, for the faithful dis- charge of the duties of his office. And in like manner, each cashier, and clerk, of said bank, shall, before he enters on the duties of his office, give bonds to the treasurer of this state, in such sum, and with such sureties, as the directors appointing him shall from time to time require, having respect to the amount of stock in the vaults.
SEC. 9. And it is hereby further enacted, That each and every officer of said bank shall, before he enters upon the duties of his office, be sworn to the faithful performance of the duties of his office. And the Di- rectors and other officers of said bank shall receive for their services, respectively, such sum as the legislature shall from time to time direct; and not in whole exceeding the whole profits of said bank for the first year, nor one half of said profits for any succeeding year.
SEC. 10. And it is hereby further enacted, That the President and Di- rectors of said bank shall have full power to purchase, hold, and dispose of any property, real or personal, as the banking interest of this state shall dictate, and for the use of this state only. And a deed, signed, scaled and acknowledged, by a majority of all the said directors, and witnessed by two witnesses, and recorded in the proper office, shall be good to convey any real estate, accruing to this state, by means of said bank.
SEC. 11. And it is hereby further enacted, That the Directors of said bank shall, annually, report to the general assembly the situation of said bank, including the amount of the deposits, and of bills in circulation, on the first day of September next preceding. And the legislature may annually, if they think proper, appoint a committee not exceeding three in number, whose duty it shall be to inspect the situation of cach branch of said bank, including the amount of deposits, and of the bills in circu- lation, and of all proceedings at cach branch of said bank, and make report to the legislature.
Passed November 10th, 180G. A true copy, Attest, THOMAS LEVERETT, Secretary.1
Nov. 10 1806, the first Directors of the bank were elected, to wit, Da- vid Robinson of Bennington, Apollos Austin of Orwell, Iloratio Sey- mour, Daniel Chipman, and John Willard of Middlebury, William C. Harrington of Burlington, John Mattocks of Peacham, James Tarbox of Randolph, Titus Hutchinson and Benjamin Swan of Woodstock, Elias Lyman of Ilartford, Alexander Campbell of Rockingham, and Mark Richards of Westminster. This list embraced men of wealth, most of whom were well tried and successful in business, and all having the confidence of the people of the State. The bank was organized with Titus Hutchinson as President; Job Lyman cashier and Charles Dana clerk of the Woodstock branch, William G. Hooker cashier and Adoni- jah Schuyler clerk of the Middlebury branch; and began to issue bills
1 Printed Laws of Vermont of 1806, p. 164.
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Appendix D.
on the 23d of February 1807. The first report showed expenses ad- justed $1570.35, unadjusted $730, and contingent expenses $350; there was allowed by the legislature, for compensation of officers, the further sum of $1SS1-making the total of expenses to Sept. 30 1807, $4531.35. Of this sum $500 had been paid by the State, leaving the sum of expen- ses to the bank $4031.35. The income of the bank by interest on loans, was $2753.27; and debts due $139,757.23. They closed their report as follows:
The obstacles which were inseparable from an institution established on principles hitherto unattempted in the banking system, have been happily surmounted, and the practicability of those principles estab- lished. The high credit and extensive circulation of our bills, we trust are sufficient to inspire the public confidence, and to ensure a continu- ance of their patronage. Under the fostering care of the Legislature, we are induced to believe that this institution may become highly indu- cive to the convenience of the citizens, and a productive source of rev- enne to the State.1
The Legislature of 1807 passed " an act iu addition to an act establish- ing the Vermont State Bank," in which the most important features were, a direction to the State Treasurer to deposit all the revenues of the State in the bank; and a provision subjecting the president and directors to be sued for any breach of contract, and directing the court rendering judgment to draw an order on the State Treasurer for the amount of the judgment. Another act established two additional branches, which were located at Burlington and Westminster; auother making the bills of the bank receivable for a State Tax of one cent on each acre of taxable land in the State ; and another prohibiting the bringing into the State any foreign bank bills for the purpose of loaning the same, forfeiting the same, and declaring void all contracts made for or on account of such bills .? The additional branches made a redistribu- tion of the directors necessary, and Oliver Chapin of Brattleborough, Noah Chittenden of Jericho, and John Curtis of St. Albans were elected instead of David Robinson, Apollos Austin, and Benjamin Swan.3 The succeeding directors were as follows: 1SOS, the list of the preceding year except Ebenezer T. Englesby of Burlington in place of Mr. Cur- tis, and Benjamin Swan of Woodstock in place of Mr. Mattocks; 1809, the same except Eleazer May of Westminster in place of Mr. Camp- bell, and Salmon Dutton jr. of Cavendish in place of Mr. Chapin; 1810, the same except Truman Chittenden of Williston in place of Noah Chit- tenden, and John Peck of Waterbury in place of Mr. Englesby; and 1811, the same except Pliny Smith of Orwell in place of Mr. Chipman; and Charles Rich of Shoreham in place of Mr. Willard. In 1812 the num- ber was reduced to four, and in 1813 to three, whese functions were to
1 Printed Assembly Journal of 1806, p. 228, and of 1807, p. 138.
2 Printed Laws of 1807, pp. 108, 152, 153, 187, 190.
3 Printed Assembly Journal of 1807, p. 273.
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Appendix D.
close the business of the bank, collect the debts due to it, and take care of the property. Ultimately the sale of lands recovered on the debts was committed to a single agent, and the closing of the bank after 1812 occupied about twenty-five years.
The bank had difficulties to contend with, in losses by the failure of banks in neighboring States, and the hostile legislation of at least one State; 1 and much more in the failure of its customers. The period from the commencement of the bank to its close was disastrous, embracing the embargo and non-intercourse acts, and the war of 1812, so it is a matter of surprise that a scheme, which was confessedly a novelty, was not seriously disastrous. To the people it was a benefit, in that it fur- nished a safer currency than the paper of private banks. This was due first to liberal legislation for the protection of the bank, and finally to prompt and vigorous measures to put an end to the experiment. Of the legislation to sustain the bank, subsequent to that already noted, were acts from 1809 until 1812, making the bills of the bank receivable for land taxes, and by the act of 1812 for state taxes also. In 1809, snm- mary collection of debts due to the bank was authorized, the cashiers being empowered to issue an extent which had all the force of an ex- cention, for the payment of any note three days past duc.2 In 1810, the bank was restrained from issuing bills to an amount exceeding twice the specie in bank, and from making any one loan exceeding $1000; a list of debtors in arrear was to be reported to the legislature; and if in ar- rear for eight months, the names were to be printed in some newspaper. The President of the bank was also required to inspect each branch annually, and in case of any mismanagement, he was to report the fact to the State Treasurer, who was to put the bond of the delinquent in suit;3 and in 1811, all state and county officers were prohibited from re- ceiving the bills of any private banks in the United States.4
In 1808, less than a year after the branch at Westminster had been put in operation, serious complaints concerning it were made to the Legislature, and not without reasons, as the report of an investigation shows.5 In 1811, Samuel C. Crafts of Craftsbury, Elihu Luce of IIart- land, and Robert Temple of Castleton were appointed a committee with full powers to examine the several branches previous to Dec. 1 1811, and again previous to Oct. 1 1812; to remove the Westminster branch to Woodstock, to be managed by the officers of that branch; and to put in suit the bonds of any of the officers of either branch. By the same act, no loans were to be made, or bills put in circulation, exceeding in
.
1See ante, p. 401; and printed Assembly Journal of 1810, pp. 145-147.
2 Printed Laws of 1809, p. 119.
3 Printed Laws of 1810, pp. 106, 158.
4 Printed Laws of 1811, p. 114.
5 For the report see printed Assembly Journal of 1808, p. 157.
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amount double the sum of specie in bank; and the directors of the sev- eral branches were directed to press an indiscriminate collection of debts due.1 Feb. 28 1812, the committee ordered the removal of the Westminster branch to Woodstock; and at the October session made a detailed report, indicating a probable failure of the Middlebury branch to redeem its bills and checks, but the probability that the profits of the other branches would more than make up the deficiency and leave a balance in favor of the State. The committee also reported that Daniel Chipman, John Willard, and Horatio Seymour, directors of the Middle- bury branch, had forfeited their bonds, and also that these directors and the committee had agreed to refer that matter to the decision of a board to be appointed by the Legislature.2 This report resulted in the follow- ing act to close the business of the bank.
AN ACT in addition to an Act establishing a State Bank.
SEC. 1. It is hereby enacted by the General Assembly of the State of Vermont, That instead of the thirteen Directors of the Vermont State Bank heretofore directed to be chosen by the act to which this is in ad- dition, there shall be chosen by ballot, by both branches of the Legisla- ture, in joint committee, at their present session, from [four] suitable persons to be directors of said bank, who shall have all the powers which the directors of said Rank now have by law, and may choose a President out of their own number .- Provided, That no bills shall be issued from said bank by way of loan, until further order of the legislature.3
SEC. 2. And it is hereby further enacted, That the committee [Samuel C. Crafts, Elihu Luce, and Robert Temple,] appointed by the Act of the last session of this legislature, entitled an Act in addition to the several Acts establishing and regulating the State Bank, are further empow- ered and hereby directed to remove the two branches of said Bank at Burlington and Middlebury, to the Bank at Woodstock, in the same manner and with the same power as the said committee were empowered and directed to remove the branch of said Bank at Westminster, to the Bank at Woodstock, by the act last mentioned .- And it shall be the duty of said committee, together with some one or more of the directors of said Bank to burn all the bills of the Vermont State Bank, in the sev- eral branches of said Bank, except what may be necessary to pay the checks due from said Bank. -
SEC. 3. And it is hereby further enacted, That the President and Di- rectors of the Vermont State Bank be and hereby are directed, with all due diligence, to collect in the most safe and speedy manner, all debts due to said Bank, and to sell the property belonging to said Bank, and to use all proper endeavors to close the concerns of said Bank, as soon as in their opinion the same can be done with advantage to this State.
SEC. 4. And it is hereby further enacted, That if any person holding any bills of said Bank, shall present the same to the Treasurer of this State, and shall elect so to exchange the same, the said Treasurer shall issue to such person, in lieu thereof, State notes, to be signed by the said Treasurer, for the amount of such bills, payable to such person or
1 Printed Laws of 1811, p. 114.
2 Printed Assembly Journal of 1812, pp. 62-96.
8 No order was ever given.
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Appendix D.
bearer, the one half in one year, and the other half in two years, with interest at the rate of six per cent. per annum. And if any person or persons, having any demand upon the Treasurer of this [State.] shall elect to receive such notes for the same, it shall be the duty of the Treasurer to issue to such person or persons, State notes. of the descrip- tion aforesaid, to the amount of the sum due to such person or persons.
SEC. 5. And it is hereby further enacted, That the Bills of said Bank shall be received in payment of all demands due to any branch of said Bank.
Passed November 9th, 1812. A true copy,
Attest, THOMAS LEVERETT, Secretary.1
The committee discharged the duties imposed by the second sec- tion of the foregoing act, and at the next session reported that they had removed the Burlington branch December 14 1812, and the Mid- dlebury branch June 4 1813 ; and further, that having prosecuted the directors and other officers of the Middlebury branch, before the judges of the supreme court, who had been appointed commissioners for that purpose by act of Nov. 4 1812, they had obtained judgment in favor of the State and taken out an execution for the sum of $22,826.13.2 They further reported as to the bills of the bank as follows:
Branches.
Bills signed.
Bills destroyed. $154.861.00
Not destroyed. $11,654.25
Burlington
$166,505.25
Middlebury
295.313.25
252.019.25
43,294.00
Westminster
200,773.00
191,714.00
9,059.00
Woodstock
234,280.50
228,159.50
6,121.00
Total
$896,872.00
$826,743.75
$70,128.25
Of the bills not destroyed, $3,606 were in bank, leaving $66,552.25 as the amount unredeemed, of which $38,141 were in the control of the State Treasurer and deposited by him in the bank.8
The annual reports of the condition of the bank, printed in the jour- nals of the Assembly, were made in forms so different as not to admit of tabulation, but the amount of bills in circulation indicates the busi- ness of the bank, to wit:
1808, 1809, -
$548,305.75 404,599.50
1810, 1811,
$211,835.00 94,932.50
In 1812, the whole amount unredeemed, embracing bills in bank, state treasury, and in circulation, was $74,301.75; 1813, $66,522.25, of which $38,141 were in the state treasury; 1814, $58,680, of which $42,- 555.25 were in the state treasury; and from year to year the redemp- tions proceeded until all the bills presented for payment were redeemed.
1Printed Laws of 1812, p. 211.
? The execution was against the three directors, Chipman, Seymour, and Willard; who, by an act of Nov. 17 1813, were relieved from all but the sum of $1238.84.
3 Printed Assembly Journal of 1813, pp. 56-59.
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Appendix D.
Zadock Thompson stated that " the loss to individuals in consequence of the failure of the institution was trifling, but the loss to the state was very considerable. " 1 The editor of this volume is not apprised of any statement of the actual loss to the State, and from all that does appear in the reports, is of the opinion that the loss, whatever it may have been, was more than compensated in furnishing to the people a currency which was altogether superior to that which they would otherwise have had. They at least suffered very little in the depreciation of the bills of the State bank, and but for the intervention of speculators, would not have suffered at all, whereas, by the failures of private banks and bank- ers in the adjoining States, their losses were considerable.
The State Bank was succeeded by private banks from 1818 until the advent of the national banks, and with rare exceptions these were ac- ceptable to the people and profitable to the stockholders-results due not only to the prudence and integrity of their managers, but for many years, by reason,of a requisition of the State that their bills should be redeemed in Boston, thus giving to them a credit equal to that of the best banks in New England.
1 Thompson's Vermont, Part II, p. 137.
APPENDIX E.
NORTHERN BOUNDARY LINE OF VERMONT.
In the executive speech of 1804, Gov. Tichenor invited the attention - of the legislature to the boundary line between Vermont and Canada, stating that some of the inhabitants residing on the line were apprehen- sive that the boundary was not clearly defined, and that it was not dis- tinctly known where the line ran.1 These apprehensions were due, in part at least, to the statement of William Coit of Burlington, in 1796, on the authority of deputy surveyor Collins of the province of Canada, that the line verged south of the true forty-fifth degree of north latitude, and thus embraced within the jurisdiction of Canada a considerable tract of land which rightfully belonged to Vermont.2 In consequence of the representations made to him, Gov. Tichenor addressed Gen. Philip Schuyler, who had been one of the commissioners of New York in 1766 for the purpose of ascertaining where the parallel of forty-five degrees of north latitude intersected Lake Champlain; and in reply the General wrote the following:
General Philip Schuyler to Gov. Tichenor.
ALBANY, October 5, 1804.
Sir,-The letter which your Excellency did me the honor to write, was delivered me yesterday. The boundary line between Canada and the late colony of New York, and the then eastern colonies, was estab- lished by the present King of Great Britain [George the third,] in Coun- cil, I think, in October 1763, and communicated to the then Governors of Canada and New York respectively. These gentlemen agreed to meet at Isle-la-Motte, on Lake Champlain, on a fixed day in the month of September 1766, accompanied with proper persons to ascertain where the parallel of forty-five degrees of north latitude would intersect that Lake. Accordingly Governor Sir Henry Moore, attended by Mr. Ilar- per, then Professor of Mathematics in the college at New-York, and myself ; on the part of Canada, Lieutenant Governor Ervin, then commanding the civil department of that province, attended by Mr. Collins, the Surveyor-General thereof, and the Marquis de Laboneer, a French or Canadian Engineer, met at the designated time and place. After having made several solar and stellar observations, the point of
1 Ante, p. 387.
2 See Vol. IV, p. 115, note 2.
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Appendix E.
intersection on Lake-Champlain was unanimously determined, and a monument erected.
The very swampy ground from the intersection of the parallel on the west bank of the Lake not permitting an extension of the boundary line to the river St. Lawrence, the parallel was only extended eastward to Mis- sisque-Bay, and the line marked. But the two Governors agreed to ap- point each a proper person, and that the persons so to be appointed should continue the parallel westward to the river St. Lawrence, and eastward to Connecticut river. On the part of New York a Mr. Valen- tine was the surveyor; I am not informed who was authorized on the part of Canada.1 The parallel was however carried to the river St. Law- rence; but Mr. Valentine dying soon after, I believe the eastern direc- tion was not even attempted during his lifetime; whether it was subse- quently run by agents authorized by the two governments, I know not; I am rather inclined to think it was not; as Sir Henry Moore, whilst on Lake-Champlain, had requested me to recommend a proper person for the survey, and Mr. Valentine was appointed in consequence of my recommendation, and it is probable I would have been consulted if a second appointment had been made.
I believe all the papers relative to the transaction in question are filed in the Secretary's office of this State, or with the papers of the Council of the late colony; if so, those relative to the extension of the boundary line to Connecticut river, if ever accomplished, will be found with them .? It is probable that I have preserved the minutes I made of the transactions on Lake-Champlain; but being confined to my bed from an inflammation in my feet, I cannot now have recourse to my papers- when I can, if I find any documents, worthy of communication, they shall be transmitted. I am, Sir, with great respect and esteen, your Excellency's most obedient servant. PH. SCHUYLER.
His excellency the Governor of the State of Vermont.
The foregoing letter was referred to James Fisk, William C. Harring- ton, Samuel Shaw, Pascal P. Enos, and Elias Buel, to whom Nathaniel Niles was joined from Council, who on the 8th of November reported the following, which was adopted by the Assembly:
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