THE NEW ZEALAND GAZETTE 189

sessions, although governed by independent allowing Colonies possessing representative
Legislatures in a more extended sense from institutions, free power of regulating their own
that which it could obtain in a country out of concerns.

It becomes important in this view to ascertain
how far the Acts of Parliament referred to
authorize the incorporation of Banking Com-
panies, for the purpose of carrying on business
beyond the limits of the United Kingdom.

This policy would be seriously prejudiced in
the case of banks if the enactments above
referred to enable companies to obtain the
privileges of a corporation for banking in
Colonies without the sanction of the local go-
vernments, and without conforming to the
principles by which the colonial Legislatures
may have been governed in the establishment
of their own banking institutions.

As the "London and Colonial Banking
Company (Limited)," propose to confine their
operations in the first instance to Canada, the
condition of the legislation affecting banks in
that country will afford the best illustration of
the questions to be considered.

As the London and Colonial Bank (Limited)
has been associated for the purpose of trans-
acting every kind of banking business in the
Colonies, it is obvious that the issue of notes
may be included in such business, and supposing
that the power of issuing notes in a Colony may
be derived from the Imperial enactments re-
ferred to, it is possible that claims might be
preferred on the part of the Bank inconsistent
with colonial regulations. In the matter of
the duration of the corporation, the establish-
ment of this Bank would be opposed to the
expressed wish of the Canadian Goverement,
and in regard to the limitation of liability in a
more restricted degree than that which has
been allowed by the Canadian enactments in
the case of other Banks, and without the
restrictions imposed by those enactments, the
constitution of this Bank would be at variance
with the course of legislation adopted in the
Colony.

The Act 3 and 4 Vict., cap. 35, for the
union of Upper and Lower Canada, confers
powers on the Legislature there, which may be
applied to the regulation of the trade of bank-
ing to an extent, at least, which may not be
insconsistent with the prerogative of the
Crown, or the rights of the Imperial Parliament.

My Lords think it desirable, in order that
they may be enabled to consider fully the
course which should be followed in this matter,
that the true legal force of the enactment of
1858 should in the first instance be ascertained,
and they desire that the solicitor will prepare
a case for the opinion of the Attorney and
Solicitor General on the following points:-

In virtue of these powers, the parliament
of Canada passed an Act some years ago for
the regulation of the issue of promissory notes,
by which the privilege of issue was reserved
under certain restrictions to Banks incor-
porated by Royal Charter or by local enact-
ment.

1. Whether the effect of the Acts referred to
   has been to authorize the establishment of
   Banks of the character of the London and
   Colonial Bank.

2. If the statutes do not apply to such a
   Bank, whether any and what means are open
   for restraining the promoters.

3. Whether the Canadian Parliament has the
   power of passing an enactment to prevent,
   regulate, or restrict the operations of the Bank,
   if established as proposed in the colony.

Since the passing of that enactment many
Acts have been passed by the Canadian
Parliament for the incorporation of local banks,
on the principle of the liability of the share-
holders to half the amount of the subscribed
capital, the concession of limited liability to
this extent being accompanied by various
restrictions for the security of the public,
regarding the management of the Banks, and
the nature and extent of the business to be
carried on by them.

When the above Minute was written, the
Acts above mentioned were in force.

Upon the 2nd of November, "The Com-
panies Act, 1862" (Stat. 25 and 26 Vict., cap.
89) came into operation.

That statute repeals almost entirely the
above mentioned Joint Stock Acts (see sec-
tions 205, 206, and 3rd Schedule), re-enacting
in substance the greater part of their material
provisions.

The position of Banks incorporated by
Royal Charter in reference to Canadian legis-
lation has on several occasions formed the sub-
ject of communication between the home and
local governments. On the occasion of an
application from the North American Bank
for a renewal of its charter, the term of which
was about to expire, it was represented by the
Canadian Government that a general revision
of the banking regulations of the Colony was
contemplated at the termination of the period
to which the privileges of the local incorpor-
ated Banks were restricted, and in deference to
a wish expressed to that effect, my Lords (in con-
currence with the views of the Secretary of State
for the Colonies), recommended that the term
of the renewed charter, granted by the Queen
in Council to the North American Bank,
should be restricted to the same date. On two
subsequent occasions Her Majesty's Govern-
ment refused compliance with applications for
the grant of charters to London companies for
banking in Canada, in consequence of a disin-
elination expressed by the Canadian Govern-
ment to an interference with their independent
control over the Banks in the Colony.

In addition also to the banking projects
mentioned in the Minute, a variety of other
banks have been projected and advertised, to
which the same observations apply as to the Lon-
don and Colonial Bank; for example, the Bank of
Canada, Nova Scotia, and New Brunswick

In these proceedings Her Majesty's Govern-
ment has been governed by the policy of