The origins of the 1855/6 introduction of general limited liability in England

Chaplin, Julia (2016) The origins of the 1855/6 introduction of general limited liability in England. Doctoral thesis, University of East Anglia.

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Abstract

The 1855/6 adoption of limited liability as a standard feature of companies incorporated under English law has puzzled historians. Members of a limited liability company have the reassurance of knowing that if the company gets into trouble, their personal financial assets will not be liable for company debts. Yet historians have found relatively little enthusiasm expressed by the investors or businessmen who might have been expected to benefit from the 1855/6 endorsement, prompting several to echo Philip Cottrell’s observation that, 'it is extremely difficult to account for this sharp and dramatic change'.

This thesis provides a first, sustained attempt to examine this historical question in detail, and identifies neglected reasons why change came to seem important when it did. Opinion shifted seismically under the economic and social pressures of the late 1840s, when commentators, of whom John Stuart Mill was the most influential, interpreted railway 'mania', the 1847 financial crisis and then the 1848 French revolution in terms of a wider need for limited liability, as a means of expanding participation in companies and capital. Calls for financial democratisation acquired further momentum from the example of the United States and the large number of lawyers who joined Parliament following the election of July 1852. Political and commercial interest came together in a covert campaign organised by solicitor Edwin Field, shipowner Robert Lamont and politician Robert Lowe, who joined forces in early 1853 to try and effect legislative change.

Knowing more about these events casts fresh light on the route that wider changes, grounded in steam-power and joint stock companies, took to limited liability. This helps illuminate a pivotal moment in British finance, when older-established intuitions about capital and companies, rooted in physical individuals, gave way to abstract, recognisably modern conceptions.

Item Type: Thesis (Doctoral)
Faculty \ School: Faculty of Arts and Humanities > School of History
Depositing User: Gillian Aldus
Date Deposited: 25 Jul 2017 13:40
Last Modified: 25 Jul 2017 13:40
URI: https://ueaeprints.uea.ac.uk/id/eprint/64258
DOI:

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