61178 History of HH

Hichens, Harrison & Co. plc - Bell Court House 11 Blomfield Street London EC2M 1LB Hichens, Harrison & Co. plc is the oldest firm of stockbrokers in the City. The founder was Robert Hichens. The precise date the firm was formed is not known, but it was in business in July 1803, shortly after The Stock Exchange was first constitutionally formed. Unlike most brokers, it is not an amalgamation of a large number of firms and its partners have taken an active role in the development of the Stock Exchange, serving both as Chairmen and on the Council. No stockbroking firm has previously survived 200 years in almost its original format and few, if any, will do so in future because of the rapidly changing corporate structures. In the following pages we have collected together material that we thought would be of interest rather than detailing all of the 200 years of the firm’s history. It is the background against which Hichens has grown and prospered making many of the individuals happy and wealthy. OUR FOUNDERS – THE FIRST 100 YEARS Two family disasters and some good luck took Robert Hichens into stockbroking. Robert was born on November 13th, 1782 at Illogan; some 10 miles north of St. Ives into a well connected, reasonably wealthy Cornish family engaged in fishing for pilchards or as it was known locally as Seine owners. His father was also the Collector of Customs at St. Ives. The family history can be traced back to the reign of Henry VII in 1505 and the family involvement with pilchard fishing to 1650. At the time pilchard fishing was very different to the conventional method of going to sea and returning with nets full of fish. Along the Cornish coast and particularly at St. Ives the fishermen waited for huge shoals of pilchards to be spotted far out at sea from late July and sometimes through to December and for these fish to come into shallow waters close to the shore. Areas of inshore sea were divided into Stems for the exclusive use by the Seine owners who were legally entitled to the pilchards in those areas of sea. The owners of the Seines were often bankers such as the Bolitho family who owned the St. Ives Bank, or other gentry. The markers on shore and on the boats were horizontal white ribbon for one group of Seines owned by the Hichens family and two horizontal white stripes, ends parted for another Hichens family. Robert’s father died when he was three years old and 5 months after the arrival of his brother William in 1784. At the time Robert reached working age the Napoleonic wars were striking a severe blow on the Seine fishing industry by cutting off its source of vital supplies of French salt to preserve the vast quantities of pilchards. The Continental markets for pilchards had also been cut off and the result was devastating. Massive numbers of pilchards died on the beach and for many years the trade was poor. Robert’s cherished wish was to become a clergyman, but his guardian insisted that he take up a lucrative profession, as there were his sisters and mother to be supported. His father also appeared to have left little money, but in his will ROBERT HICHENS 1782-1865 Deputy Chairman of The Stock Exchange 1837-1838 Chairman of The Stock Exchange 1838-1842 Trustee & Manager of The Stock Exchange 1843-1863 Member of Committee of The Stock Exchange 1833-1844 1 stipulated that no widow or orphans who owed him money were to be pressed for it. Robert accordingly joined a London shipping firm in about 1800, no doubt relying on the family connections with Londoners who had been responsible in earlier years for the substantial export of pilchards from St. Ives to France, Spain and Italy. In this capacity Robert transacted considerable business for the East India Company, providing ships to take out goods to India for them, and bringing merchandise back to England. The Company’s merchants promised Robert the management of their business if he set up as a stockbroker. This he did at the age of 20 initially in Lombard Street and later in Threadneedle Street, in the City of London. The oldest document bearing the signature of Robert Hichens as a stockbroker is a consolidated £3 per Cent. Annuities Government (1751) stock certificate dated 22nd July 1803 in favour of Robert Wallbrook and is displayed in our Board Room. Robert Wallbrook seems to have been an active and wealthy client because we hold other stock certificates for him which were not cashed at maturity. Initially Robert Hichens, like many brokers, did not join The Stock Exchange when it formally came into existence on 3rd March 1801, but did join later in 1806. In February 1802 the first Stock Exchange floor was open between the hours of 10 am and 4 pm. Whereas at the first annual renewal date the Stock Exchange had 498 members (having rejected 17 as unsuitable) by 1851 there were 906 and by 1905 the figure had reached 5567. Most partnerships at the time consisted of two or three individuals and the number of firms expanded rapidly from 110 in 1843 to 437 by 1890. Robert Hichens married Jane Snaith on 7th August 1823 in London. They had eight children, four sons and four daughters. Only one of the sons, Robert Snaith Hichens joined Hichens. Of the four daughters Mary Elizabeth died after 15 months, Jane after 12 years and while both Margaret Jope and Catherine Jackson married, their children did not choose stockbroking as a career. All Robert’s children were baptised at St. Giles Church, Camberwell in South London between 1823 and 1836. Jane’s father, Westgarth Snaith, was a banker (as was his father, John) with his firm located at 5 Mansion House Street in the City of London. John died in 1788 and Westgarth in 1816. Westgarth married Jane Sikes who was the daughter of 2 Thomas Sikes and Jane Barnston. These were all banking names though the firms underwent style changes from Boldero, Carter, Barnston, and Snaith & Carter in 1790 to Sikes, Snaith & Snaith in 1825. The Hichens family was connected with St. Ives at least as early as 1505, when the name was spelt “Huchyns”. In the Borough records, it was given as “Hychen” in 1578. In 1603, as “Hechin” and 1646 as “Hichens”. Henry Hichens agreed to and signed a bye-law relating to the pilchard fishery in 1650 and the borough records record William Hichens as owner of a fishing boat called the Saint Ives, in 1752 and having a stem at Leigh, and John Hichens with a stem at Carrack Gladden. Also when Mary Williams married William Hichens in 1738 the connection with the pilchard trade was much strengthened as it linked two powerful families in the same business. In 1655 Richard Hichings was the borough Constable. Members of the Hichens family represented St. Ives as Mayor some 14 times between 1607 and 1867. William, Robert’s younger brother, entered into the Partnership in 1813 and the firm became known as R. & W. Hichens. William married twice – Maria Susanna Lloyd in 1815, who died aged 39 in 1826 and Anne Elizabeth Kinsman on 24th December 1827. His three sons were Andrew Kinsman who married Mary Prinsep, William (‘William the younger’ as he was then referred to), became a Major General in the Army, and John Knill Jope married Mary Byrn and produced James who joined Hichens. Both Andrew and John also joined the firm. WILLIAM HICHENS 1784-1849 Member of Committee of The Stock Exchange 1844-1849 William also had four daughters. Maria, married Jope Rogers who made a career in the Inner Temple, Mary married John Hockin and had 11 children, Clara married Francis Jones and Annie married Alexander Henry Christie and had two children (Charles and Annie). In 1843 William lived at 12 Park Place, Camberwell Grove, London. The year after William entered into the Partnership, Robert was called to give evidence at the trial of Admiral Lord Cochrane: a conspiracy whereby a group of individuals was convicted of rigging the market in Government stock known as Omnium Consols stock. The scale and effrontery of the operation was quite enormous, the group purchasing a total of £1,781,000 of stock through four stockbrokers. It is on record that the total profits of the syndicate amounted to £20,000. Hichens bought a total of £565,000 of stock for the account of The Hon. A. Cochrane Johnson, M.P. on which a profit in excess of £4,600 was made. A more detailed account is contained later in this history. Frederic Harrison joined R. & W. Hichens in 1817, at the age of 18, having earlier begun training as an architect at Mr Stedman’s School at Streatham. Frederic was the sixth son of John Harrison, a large building contractor and architect who built Bryanston Square and Carlton House Terrace. He was also the builder of Frederick Street and Harrison Street, both off the Grays’s Inn Road, where later generations of his family practiced law. Young Frederic was born on September 23rd 1799 brought up and lived at 9 Berkeley Street, off Berkeley Square, later occupied by an aunt and uncle. Most occupants of Berkeley Square in this period entertained lavishly. In 1847 the house was sold to Louis Napoleon, who installed his mistress, Mrs Howard, there. John Harrison retired in 1814 from his building business in London to his home in Leicestershire and died there some years later. It is not recorded if he returned to his family home of Stocking Farm, near Leicester which he had left in about 1770. His father was born in 1714, in the reign of Queen Anne and it is possible to trace the family back to the time of Elizabeth I in 1590. On October 23rd 1829, Frederic Harrison, whilst still earning a salary of under £500 a year (equivalent to £22,525 today) married Jane Brice. For some years Frederic and Jane lived with her parents in Euston Square, later moving to a cottage near Muswell Hill, a quiet village at the time on the grassy slopes to the north of London. Obviously Frederic Harrison and Robert Hichens became good friends as well as partners. Robert named one of his sons Frederick Harrison Hichens after Frederic and Frederic named his first (he died after four months) and third sons, Robert Hichens Camden Harrison. At short intervals Frederic, had five surviving sons Frederic (born in 1831), Lawrence (1833): Charles (1835): Robert Hichens Camden (1837) and William Sidney (1839). From the lawn of the Harrison’s cottage at the top of Muswell Hill it is recorded that his second son Frederic beheld with awe the distant smoke, the steeples, and the dome of St Paul’s – a mysterious world to which his father travelled daily by fourhorse coach. London was to be his home for nearly 60 years. At that time stabling (horse parking!) for the City was on the outskirts of London Wall and in Lincoln’s Inn Fields. Frederic Harrison became a notable historian of the day and Professor of Jurisprudence and International at the Inns of Court and also President of the English ‘Positivists’, known as the ‘Religion of Humanity’. His views up to the end of the century attracted many and it would have been impossible throughout that time to read a book on philosophy or sociology that did not mention them. After being educated at King’s College School and Wadham College, Oxford, where he obtained a first-class degree he went on to read law at 3 FREDERIC HARRISON 1799-1881 Member of Committee of The Stock Exchange 1858-1875 Trustee & Manager of The Stock Exchange 1863-1870 Lincoln’s Inn and was called to the Bar in 1858. He served on the Royal Commission on Trade Union law in 1867, refused to sign the majority report and produced his own minority report on which Trade Union law was eventually based. In his elaborate Household Account Book, Frederic Harrison (senior) records every penny of his expenditure. Total expenditure in 1831, the year of his youngest son’s birth, was £600 including two excursions to the seaside. Frederic Harrison is recorded as being one of the most economical and abstemious of men, though he laid down wine in that year to the amount of £110 – one sixth of his income. One of the most singular things in these accounts is the enormous proportion of wine – this was evidently a business outlay as the firm made constant and large investments for the great wine merchants. He also recorded the moderate cost of a journey to Brighton and lodgings, excursions to Brighton for several weeks at only £40. Rent and taxes were £152. The entire household expenditure in 1836 for the family of five and servants, including three months in Brighton, was £760. In 1838, with six in the family and six weeks in Brighton, it was £839 and a year later the budget of £917 including a holiday for the children, a nurse and a governess at Ramsgate while Mrs Harrison awaited the birth of her last child. On 24th July 1840 Hichens opened accounts at the Bank of England which are maintained to this day and also became bankers themselves, issuing chequebooks to selected clients, an activity that continued well into the 20th Century. Hichens remains active in the City money markets and unlike the majority of stockbrokers is a multi-bank organisation, something that is rare among businesses generally. The prosperity of the firm was temporarily imperilled by the discovery in October 1841 that forged bills were being circulated by Mr. J. Beaumont-Smith, a clerk in the office of the Exchequer concerned with issuing Exchequer bills. While preparing genuine bills for issue BeaumontSmith provided himself with duplicates identical to the originals except for the signature, which he forged. Hichens had taken £14,000 of bills from E. L. Morgan and a further £3,000 from de Berchhem through another broker J. W. Scott. Robert Hichens identified the forgery. It is not known how his suspicions were aroused, but he took some of the bills to the Exchequer’s Office for examination. So clever were the forgeries that at first he was assured that the bills were genuine. Later a second clerk revealed the truth and Robert Hichens met with the Chancellor of the Exchequer and both the Treasury and the Stock Exchange conducted inquiries. Extract from Copy Letter Book of the bank of Taylors and Lloyds, Birmingham (established 1765). The original is held in the archives of Lloyds Bank. 4 Bankers, Taylor’s & Lloyds of Birmingham (Lloyds Bank) extracted from their archives the letter they wrote to Hichens on 28th December 1841. “We have your account stated with us – which we find correct- at the time we beg leave to say that your straight forward honourable conduct in your transactions with us has gained you our esteem and respect- with respect to the misfortune you have fallen under being holders of spurious Exchequer Bills (which no foresight or prudence could have guarded against – nor can it in any way shake our confidence in your honour and integrity). We sincerely hope that the Government will do you justice by protecting you from loss – from the confidence you and the most prudent men place on the security of Exchequer Bills”. The Exchequers Office in London sent for the highly respected Henry William Chisholm. At the time he was in Edinburgh and on his return he suffered all the discomforts of an urgent journey, because all the inside seats of the stagecoach had already been allocated, he travelled that March morning coldly and uncomfortably as an outside passenger. At Newcastle-upon-Tyne he was able to travel onwards by the new method of travel, a train drawn by a steam engine! On arrival in London, Chisholm discovered that rumour was spreading by word of mouth that forged bills were being circulated. He confronted Beaumont-Smith who confessed to his guilt and was arrested. Beaumont-Smith, a senior clerk at the Exchequer Office, had a good salary and lived with his wife and sons in a house in the Camden Road at a rent of £60 a year. His extra expense was that he kept a phaeton drawn by a pair of cobs. All the issues were documented in a Royal Commission report including particulars of how Beaumont-Smith had forged £1,000 bills to the extent of £400,000 of which £300,000 had been advanced by different people as security. Some brokers involved were unable to meet their obligations including Morgans and de Berchhem but Hichens & Harrison, as it was known at the time, were able to honour theirs and survived. Beaumont-Smith pleaded guilty, was convicted and sentenced to be transported for life to what was at that time known as Van Dieman’s Land (Tasmania). After seven years he was granted a pardon on condition he never returned to England. Stock Exchange firms were cleared of any complicity in the forgeries and Robert Hichens was presented with a silver punch bowl by the Stock Exchange on 23rd June 1843 in testimony to his valuable services. This bowl, still in mint condition, is held by the family in Cornwall. The domestic implications of the forged bonds were that some servants were dismissed at the Harrison household, others suffered a wage cut from £100 to £43 while Nurse Naylor, Frederic’s favourite, chose to stay on, deferring her wages. At the same time expenditure on beer and wine was cut from £69 to £6. At this time (1843) the family was living at 22 Oxford Square, north of Hyde Park, in a house Harrison had built for himself but evidence of improved fortunes is illustrated by their later move to Sutton Place where Frederic had the long gallery restored in 1878-better known in recent times as the home of J. Paul Getty, the oil multi-millionaire. In 1843 the case of Young (plaintiff) v Hichens (defendants) was tried at Cornwall Lent Assizes. The previous year, the seine boat Wesley enclosed a fine shoal of mackerel, but immediately the Helen, belonging to the Hichens family crossed the Wesley and recovered the mackerel. At the trial the plaintiff claimed that the Hichens family were not entitled to take the fish and relied on the law as applied to the pilchard fishery. The jury found that the defendants were entitled to the mackerel, as the seine laws that applied to pilchards did not cover other fish. When William (solicitor) grandson of John and Blanche died in 1864 his Will instructed that his four sons should share his investment in the St. Ives Pilchard Fishery, cellars and lofts. Members of the Hichens family, subsequently remained Seine owners at least until 1885 and possibly much later. A sample of 60 prospectuses taken from Bradshaw’s Railway Gazette for 1845 shows 35 firms whose names appeared in at least one prospectus. Most active were Peppercorne & Co. with 10 issues, Shewelled Sons with 8 and others included Hichens & Harrison. The railway boom of 1845 was marked by one of the biggest waves of speculation on the Stock Exchange up to that point. Robert Hichens, according to Frederic Harrison, ‘was a man who devoted no small part of his time and his fortune to the High Church movement; of strong character, much acumen and not a little ecclesiological learning’. Robert’s strong religious beliefs had a considerable influence on two of his sons. As a churchman he was anxious for his sons to be ordained, with partly, the idea that they should do 5 the work he had been unable to undertake. Three of them took Holy Orders, but the eldest William, who gained a double first at Oxford, died aged 25 of typhoid in his first curacy at St. Feock, Cornwall. Both Frederick Harrison Hichens (named after his Partner) and Thomas Sikes Hichens went into Holy Orders and became leading churchmen. Several members of later generations were also ordained and Rev’d. Thomas Robert Hichens, the third child of 11 children of Thomas Sikes Hichens (born 1769) and Elizabeth Carbis (born 1757) built a church in Christchurch, Canterbury, New Zealand. An ivycovered cross stands in memory of Rev’d. Thomas “who worked hard to get the church built, and was one of its first two churchwardens”. Thomas died in New Zealand in 1868. Apart from applying his energies to the business and the Church, Robert also took a close interest in the development of The Stock Exchange. At that time The Stock Exchange was a very different model to the one we know today and the channel through which all the money business of London flowed. Robert acted as “broker to the London Joint-Stock Bank and to several Lombard Street Bankers and was reported in 1848 as being “a large dealer in money”. This is also evidenced by Lloyds Bank which in December 1826 had deposits with Hichens of £5,000 a figure that had become £27,000 10 years later”. Robert’s distant relative was a solicitor, politician and mining adventurer who built the village of Halsetown in 1832, to house his tin mine workers. James Halse married Mary Hichens, on April 14th, 1800 and later entered into partnership with William Hichens. They appeared to have practised both in St. Ives and in Penzance, some five miles from St. Ives. John Jope Rogers (of a highly respected St. Ives family) was articled to William in the Penzance office and after he was called to the Bar, married the elder daughter of William, Robert’s brother. James Halse claimed descent from John Hals, who was appointed Justices of the Common Pleas in 1423. The name Hals appears in the local records as far back as 1327. James was Mayor in 1813, alderman in 1833 and represented the borough as a Tory MP at various times between 1826 and 1838. He was regarded as a sharp and shrewd politician and died in London in 1838 whilst attending to his parliamentary duties. His widow Mary, daughter of Thomas and Mary Hichens (nee Allen) lived for another 13 years most of the time with her brother Richard and his son Richard (both solicitors). Halsetown was built in the fold of the hills some two miles West of St. Ives and in 1857 Robert Hichens purchased 40 acres of land for £180 known as the Jenning’s land which he gave together with £1,000 towards the building costs of £2,300 to construct a new church St. John’s in the Fields, an apt name as it was at the time really in the fields. Robert also encouraged others to contribute and among the 28 that together gifted £1043.19s.0d. were the Governors of Queen Anne’s bounty £400, the Hichens family members £241, Bolitho Sons, the Earls of Darlington and Lauderdale and the Duke of Bedford. The church is made of granite; it consists of chancel, nave, aisles, south porch and has a 66-foot steeple containing one bell. Robert also gifted £1,000 towards an endowment of the Living and £800 with land to build a large Parsonage adjacent to the Anglican Church. It is recorded that the reason the church was built two miles from Halsetown is that non-conformists had acquired all the land nearer to the town. Letter from Ecclesiastical Commission to Robert Hichens dated 29th April 1859 acknowledging £1000 towards the vicarage at St. John’s in the Fields. Robert took a particular interest in the construction and the eventual consecration of St. John’s in the Fields. The petition for consecration 6 was presented on 26th May 1860, by the founder and patron Robert Hichens and the Bishop Henry Philpotts, of Exeter, performed the ceremony on one of his rare visits to St. Ives. The Bishop had arrived at the church in a carriage drawn by four greys. Indeed, he remarked on the day that he “consented to undertaking the fatiguing duty of consecrating the church as a mark of his regard for Robert Hichens”. The St. Ives Times stated, “It was an affecting sight to observe these good old men, both on the extreme verge of life as octogenarians, meeting on such an occasion”. No doubt for Robert Hichens it was a time of pride giving him a feeling of returning to his roots in St. Ives and of real achievement for the church. At the reception that followed he presented 50 children with a shilling each and 10 old men and 10 women from the village with half a sovereign each in commemoration of the consecration of St. John’s in the Fields. The first incumbent was the Rev’d. W. H. Drake who had nine children, which is why it was necessary to build such a large vicarage. Rev’d. Drake apparently could not live well on his stipend of £180 a year in 1868 and consequently threw in his lot with the Liberal Party delivering frequent political speeches to the annoyance of the Hichens family who were staunch Tories. Equally, he neglected the church and members of the Hichens family gave voice to their feelings in letters to the Cornish press in the 1870s. This resulted in Rev’d. Drake and his friends attempting to establish that the Living provided by Robert Hichens was of comparatively meagre proportions. In turn a friend of the late Robert Hichens accused Rev’d. Drake of total neglect of his duties and he was appointed to a church in the North of England. On October 18th 1909, the Rev’d. Frederick Harrison Hichens, of Barton Fields, Canterbury, transferred the financial upkeep (“the Living”) of Halsetown to the Dean & Chapter of the Cathedral Church of St, Mary’s, Truro, in order that the Living would be treated as within the public patronage. Today, the church is too big having been built to accommodate 500 people. To house the present smaller thriving congregation comfortably a second altar has been built in the centre of the church. A second vicarage has also been built and the original one was sold in 1970 for £7,500 to Mr Sykes, the present owner. He converted it into a hotel and has a portrait of Robert Hichens overlooking his grand staircase. ST JOHNS IN THE FIELDS 7 The standing of Hichens is also reflected in its participation in the affairs of the Stock Exchange, via the General Purposes Committee, the body that regulated admissions and the conduct of business of Stock Exchange members. Robert served as a member of the General Purposes Committee for 10 years from 1833, Deputy Chairman in 1837-38 and Chairman for four years until 1842. After his retirement as Chairman Robert continued to serve as an active Council member until 1863. William served on the General Purposes Committee from 1844 to 1849. Throughout his life in London Robert had lived very quietly at East Dulwich, without ostentation and died after a two-year illness on 20th March 1865 aged 82 and though he had indicated he wished to be placed in the family vault in St. Ives Church, he was buried in Camberwell Borough Cemetry, East Dulwich on 27th March 1865. Robert had prepared for his own burial in August 1850 when he wrote the “vault extends six feet westward from the slate bearing my name and is six feet wide at the east end being deep enough for three tiers of full sized coffins”. At that time the vault in St. Ives Church already contained his Father, Mother, Jane, Mary, Blanche, Andrew, Rev’d. William Hichens and his aunt Mary plus four other members of the Hichens family whose remains had “escaped from their coffins” on former occasions. Jane, Robert’s wife, had died some three years earlier in 1862 and is buried in the Nunhead Cemetery Burial Site in South London. Brother William, who died aged 65 on Christmas Day 1849 (22 years to the day after his second marriage) is buried in the family church of St. Giles, Camberwell, which had been destroyed by fire in 1841. The St. Ives church, virtually in the harbour, has been a memorable place for the Hichens family. At one time the Hichens and the Halse families had eight pews reserved for themselves and servants in the church. The east window of the south aisle is of ornamental glass; a brass attached to it is inscribed “This window was erected A.D. 1850, by Robert Hichens, in memory of his daughters, Jane, who died January 24th 1835 and Margaret Jope, who died 12th August, 1849”. The church also has tablets of stone making reference to the deposit of mortal remains of various family members including Robert’s Mother and Father. The Will of Robert Hichens throws a light on both Hichens and the City. Over a period of 62 years 8 Robert had established a substantial stockbroking firm, supported Lloyds Bank, served as Chairman of the Stock Exchange and established his big family with great wealth and died with a large estate. Robert held the remaining 60 years of a long lease on properties at 39, 40, 41 Poultry and 1 and 2 Old Jewry. The premises consisted of a four storey house with warehouses at the rear and some shops. This was a key site close to the Bank of England and opposite the Mansion House and amounted to 3,000 sq. ft. of houses, shops and warehouses. The rent on the remaining 60 year lease was at £1,000 per annum. The property was sold on 10th June, 1868. In later years this block of buildings housed the Midland Bank for a long time. He also owned a property in Cornhill and Moor House (his home) at 2, East Dulwich Grove, East Dulwich, valued for Probate at £3,000 plus the contents at £361.3s.0d. The house was inherited by Robert Snaith Hichens. Robert did not leave a substantial sum to his family church in the town of St. Ives, formerly called Portia, in his Will though throughout his lifetime he had given generous sums of money to churches, hospitals and struggling artists. He also helped to start a library for students at one of London’s hospitals in conjunction with his friend Joshua Watson. Robert had a keen appreciation of art, was a great collector of old engravings and china. He would have been pleased that one of his grandsons – another Robert Hichens – achieved success as a novelist, and wrote, among other well known books, “The Garden of Allah” which was later turned into a successful play on the London stage and televised. At the time of his death Robert’s earnings account in Hichens contained £15,563.6s.11d of undrawn cash indicating the firm had enjoyed substantial profitability and his cash and security accounts contained a further £52,000 (equivalent to £2.49 million today) and his entire estate was valued at £188,000 or £8.99 million in current money terms. Hichens sold Robert’s share in The Stock Exchange on 22nd November 1865 for £298.21s.5d after deducting £1.1s.0d commission. This was for no more than it was acquired in 1806 but it had served him extremely well. The main beneficiaries of Robert’s estate were his four surviving children Robert Snaith Hichens, Catherine Jackson Hichens, Rev’d. Sikes Hichens and Rev’d. Frederick Hichens. There were 55 other legacies the largest of which was £2,000 to Rev’d. Frederick Harrison Hichens. the time large properties were not selling quickly though in the autumn of 1925 Mrs Harrison sold Shiplake Court, as it was then known. The house and farm buildings passed through various hands, including the British Broadcasting Corporation until 1958 when it was bought by a company which founded the well known boys’ school Shiplake College. Lawrence Harrison asked Laurence Matthey, in September 1877, to take into partnership his cousin Edward Lake Harrison and the firm became Matthey and Harrison, Gilt-Jobbers. The earlier background is that when Laurence Matthew left school in 1850 he became first a clerk to his father, subsequently to his brothers, a member in 1860, and in 1864 began business for himself as a dealer in the consol market and founded the business that subsequently became Matthey and Harrison. The firm ceased trading as a Gilt-Jobber in the early 1960’s. No doubt Hichens had regular dealings with Matthey & Harrison as it did with John Jope Rogers (husband of William’s daughter Maria) of the Inner Temple and Charles and Sidney sons of Frederic Harrison, and Partners in C & S Harrison later called Harrison, Beal & Harrison of 19, Bedford Row London. Charles died at 84, managing his business keenly to the last. Robert Snaith Hichens became an Ensign in the 29th Regiment Madras Native Infantry and spent some time abroad. This is confirmed by the birth of his first two children, Margaret Jane in India and Charlotte Elizabeth in Penang. He died in St. Ives on 10th November 1868 one day after being re-appointed Mayor of St. Ives. However, his estate was divided between his wife Elizabeth and four godchildren and makes no reference to his own four children. The godchildren were Robert Hichens, (son of John and Mary Hockin of Park Lee Blackheath), Reginald Jones (son of Francis and Clara of Cleveland Villa Blackheath, Granville (son of The Reverend Augustus Bozzie Granville of Hatcham near Deptford) and Edith Drake (daughter of The Reverend W Hinton Drake of the Vicarage, St Ives). Snaith had been generous to the poor during his lifetime and was well respected by churchmen and business people. Frederic Harrison was elected to the General Purposes committee of the Stock Exchange in 1858 and served until 1875 whilst also being a Trustee and Manager for seven years to 1870. His son Lawrence served on the Committee of the Stock Exchange from 1875 until 1890. CREST OF ROBERT HICHENS The personal Crest of Robert Hichens with motto “fac recte nil time” ‘do right and fear nothing’ For a short period in 1860 James Capel & Co had five or six partners until 1885 and throughout this period it was regarded either as the largest stockbroking firm or one of the largest firms on the Stock Exchange along with Foster & Braithwaite, W.A. & N Wilkinson, Hichens & Harrison and Edward Ellis & co. Robert Hichens Camden Harrison was admitted as a member of the London Stock Exchange in 1861 at the age of 24. In 1877, aged 40 he married Helen Mary Eustace Smith, one of 10 children of Thomas Eustace Smith, a Tynemouth ship repairer. It is said that when Robert Harrison went up to Newcastle to see his intended bride of 18 he was mistaken for the new butler and driven to the rear door of Gosforth Park – the Smith’s home. At the time his London home was at 73 Cromwell Road not far from the London house of the Smiths in Prince’s Gate. Robert and Helen had twins Cecil Eustace and Philip born in London in 1878. One year later the acknowledged wealthy stockbroker bought at auction in September 1888 Shiplake Court Farm, near Henley, Oxfordshire. It consisted of a 300 year old house once in the hands of the Englefield and the Plowden families, some 362 acres with a long frontage onto the river Thames. The Harrisons family demolished the house and at a cost of £30,000 built a new somewhat smaller Tudor style house. Such was the interest that the architect’s drawings were exhibited at the Royal Academy Exhibition and when the house was finally finished articles appeared in Country Life in 1898. Robert Harrison died in November 1924. At 9 For many years Frederic had a very moderate share of the Partnership Profits of Hichens, but he ultimately became the Senior Partner and placed his two sons in Hichens, and retired with a very considerable fortune reported to be some £250,000 (equivalent to £12.288 million today). He died in 1881 aged 81 leaving his son Robert Hichens Camden Harrison, Lawrence and his wife’s father, a hearty and sound man, then aged 78. Lawrence died in 1899 some 17 years after his father. The acquisition of wealth by Frederic was not dissimilar to the success of Robert Hichens and fairly typical of the mid-Victorian middle class success story. THE NEXT 100 YEARS John Knill Jope Hichens, like his predecessors, also took an active interest in The Stock Exchange, serving as a member of its General Purposes Committee from 1890 to 1898 and Chairman for 10 years to 1907. During his term as Chairman he regularly wrote to Her Majesty Queen Victoria. On 24th May 1899 he wrote to Windsor Castle to congratulate her on the occasion of her 80th birthday. John Knill Jope Hichens died at the age of 71 years in 1908. His home at ‘Beech Grove’, Sunninghill, Berks, situated near Ascot had been valued at £12,500 in August 1891. The property consisted of a carriage drive, 16 bedrooms, detached stabling, two coach houses, four carriages and large grounds. There were also a range of farmhouses, greenhouses and a lodge in a sizeable acreage. Hichens was instructed to place a large amount of shares in Arthur Guinness in 1889. Protracted discussions took place on the technicality of the issue and in particular who would bear the cost of printing notices and information. Hichens prepared a draft circular intended for private use. In March 1890, a cable from Hichens was sent to the Dublin agent “Fear serious complications as circular intended for clients and friends has been sent to all shareholders. Please explain, effect on the market very bad”. Altogether 2,000 Guinness shareholders received the information, together with the private agreements to the issue. The circular said, ‘The prospects of the Company for the present year are extraordinarily favourable, as in addition to a substantial increase in general business, the prices of hops and barley are exceptionally low. Savings from these alone are expected to amount to £120,000 and the reserves and depreciation funds are expected to reach the enormous figure of £600,000 so that it would not be necessary to put such large amounts to reserves in the future; the dividend should therefore not be less than 18 per cent, for this year and the earnings should reach 24 per cent’. Understandably the introduction was a success. Andrew Kinsman Hichens (admitted as a Stock Exchange member in 1855) lived at Monk’s Hatch, near Compton, Surrey, and remained a partner for 51 years, at least 16 years as Senior Partner and 25 years as Trustee and Manager of The Stock Exchange. He died, aged 73 years, in 1906, leaving the estate to his widow, Mary Emily, and his nephew, James Byrn Hichens (killed in action in 1916). At the time Andrew insured the life of his chauffeur with the Law Fidelity & General Insurance Corporation for a premium of 15 shillings a year. During the 1840’s London was first linked by telegraph to all the major cities in Britain, in 1851 to France and later to New York that prompted the development of the ticker tape in the United States in 1872. The first record of Hichens paying the Post Office Telecommunication Telegraph System, as ‘Hichens Stock London’ is an annual standing order for £1.11s.0d. put in place at the Bank of England in 1896. Subsequently, the standing order was amended three times throughout its existence JOHN KNILL JOPE HICHENS 1836-1908 Member of Committee of the Stock Exchange 1890-1908 Chairman of the Stock Exchange 1897-1907 10 June 1900 until 29th September at a cost of £100 and then acquired a 50-year lease on 25 Austin Friars for £50,000. This was paid for by £30,000 in cash and £20,000 by a 10 year loan at 4% fixed from the ‘firm’s good friends’, the London Life Association Limited of 81 King William Street. In August 1908 The Life Association of London bid £25,000 for the lease and some Partners were mindful of accepting. A valuation of the lease of £15,000 was obtained but it is not clear if the bid was rejected or revised, though in 1916 the balance outstanding of £18,491 was repaid to the London Life Association. The earliest record of profitability in Hichens is the 1909-10 tax demand that shows the partnership earned profits of £2,827 (equivalent today of £143,103) and paid tax of £424.10s.0d. A year later it earned £5,004 and paid tax of £774.4s.6d. Basil Snaith Hichens of 27 Chester Street, Grosvenor Street, London retired in January 1912 having served since 1896 leaving a Partnership of Robert Hichens Harrison, Leonard Frederic Harrison, James Byrn Hichens and George Charles Neilson. The last partner bearing the Hichens name was James Byrn Hichens, grandson of William Hichens. He had become a member and joined his father (J. K. J. Hichens) in 1900. ANDREW KINSMAN HICHENS 1833-1906 Manager of The Stock Exchange 1881-1906 with the final direct payment being £3.45 in October 1991. The earliest address of Hichens was in Lombard Street. Robert was admitted to the freedom of the worshipful company of Vintners on 17th November 1807 and his address at that time was Robert Hichens of Lombard Street. Judging by the correspondence the firm swiftly moved to offices at various points in Threadneedle Street (a Street it remained in for almost the next 100 years) opposite the Stock Exchange and close to the Royal Exchange and the Bank of England. In 1816, the Post Office London Directory listed Robt. & Wm. Hichens as Stock and Insurance Brokers of 11, Threadneedle Street. At that time the Threadneedle Street was described as having 68 houses and a length of 137 yards. It was the custom to provide these detail on Streets. Hichens remained in these offices until 1847, when it moved to 18, Threadneedle Street, occupied 21, Threadneedle Street from about 1860 to 1867 and finally moved to 41, Threadneedle Street in October 1894 when it obtained a 53/4 year lease at £350 per annum on 1,700 ft. sq. from Eagle Star. It is clear from the correspondence that Eagle Star of 79 Pall Mall, who in turn held an 80-year lease from Emmanuel College, Cambridge, at a total rent of £3,025, intended rebuilding the total site area of 2,600 sq. ft. at a cost of £15,000. Hichens obtained a short extension of its lease from 14th JAMES BYRN HICHENS 1873-1916 Killed in action in France 16th July 1916 11 Whilst at Winchester he lost the sight of one eye while playing football. He went to Magdalen College, Oxford, in 1891, took a First in Moderations and a Second in “Greats” and graduated in 1895. Though 41 when the First World War was declared, he offered himself for the Army. He was three times rejected but persisted in his efforts, until he obtained his commission in the King’s Royal Rifle Regiment. In the autumn of 1915 he went to France, took part in various engagements before the Battle of the Somme opened, and was injured in a German gas attack. Speedily recovering he returned to join his Battalion. He was killed in action near High Wood on 15th July 1916 aged 43 years. Earlier in the day he had been wounded but refused to retire and went on with his men. His Major wrote, “He was one of the pluckiest of men I have met”. An unexpected difficulty was experienced in 1913 when a firm of solicitors complained that on advice from Hichens their clients had purchased a considerable quantity of Republic of China Treasury Bills dated 13th December 1913. It seems that Hichens had sold £150,000 of 1 year Chinese Treasury Bills and stated that they were a direct obligation of the Chinese Republic and that bonds to a value of £214,000 in Peking Hankow Railway 7% Mortgage would be deposited with the Chartered Bank of India, China and Australia as security. The Bills were not met on maturity and Hichens speedily wrote to Lew Yuk Lin, Minister at the Chinese Legation. On 20th December 1913 the Minister replied apologising for the non-payment, ‘due to wholly unexpected delays’ and hoping to make payment ‘within the next few days’. Ashurst, Morris, Crisp wrote a few days later indicating that the matter would be taken care of by “first class people on the Continent”. They also commented “it is always difficult to speak of finality in any negotiations with the Chinese”. There is no further correspondence on the files and we must assume that the Bills were eventually met. In any event Statute of Limitations will apply! The Russian & English Bank, established in 1912, enjoyed ‘friendly support of the Russian Government, and was the only English banking institution in Russia’, was floated in London four years prior to the Russian Revolution, by Hichens in 1913. Previously a few dealings had taken place on the St. Petersburg Exchange that was, at that time ‘very partial to Bank shares’. The Imperial & 12 Foreign Corporation Limited and the AngloFrench Mercantile & Finance Corporation controlled the Bank and the main Directors in London of the Bank were Lord Balfour of Burleigh and Mr Austin Chamberlain. The Moscow Narodony bank had been set up in 1911 initially to help Russian co-operatives finance trade but this was nationalised in 1918. It will be back in private hands in late 2003. The Cuyutlan Gold Mine Issue reveals that Hichens conducted due diligence at the turn of the century despite the distance involved. Hichens was asked to float $200,000 of 7% five-year first mortgage convertible gold debentures. In order to discover more of the background the firm instructed Mr Seaborn Marks to visit the mine on the west coast of Mexico departing on the ‘SS Lusitania’ on 25th January 1913, for a fee of five guineas per day plus expenses. The mine was situated on the Southern Pacific Railway in the territory of Tepic, on the West coast of Mexico. Labour costs at the time were put at 35 cents to $1.15 a day. Mr Seaborn Marks reported favourably on his return in April and the issue proceeded successfully. In 1915, James had written to the Inspector of Taxes requesting relief and explaining, “The great fall off in profits of Hichens for the year 1914, is due to the closure of The Stock Exchange for five months, in addition to which two partners were away on active service”. The actual profit in 1914 was £8,915. It is not clear if any relief was given, but the firm paid tax of £1,290.19s.6d. at the highest rate of 2/6 in the £. In 1916-17 the firm’s tax assessment amounted to £8,015 at 5/- in the £1 indicating pre-tax profits for the partnership of £32,060 equivalent to £1.10 million in 2003 money terms. It is astonishing that profits were generated at that level at that time but is supported by the tax demand and conversion for inflation is based on annual data provided by the Bank of England. In 1916, Hichens, Harrison & Co incorporated the business of Woolston, Beeton, Broderick and West and became known in the market as “Hichens Harrison North East South and West”. Hichens moved into the offices of Woolston at 18 Austin Friars. No doubt this permitted the Partners to release the profit on the long lease at 21 Austin Friars. The name Woolston was added to the firm’s name to form Hichens, Harrison, Woolston & Co. It is not clear why such importance was attached to “Woolston” which in 1901 had merged with Beeton, Broderick & West; since the partnership deed merely agreed an account should be kept in the books of the firm as the Woolston Account. When Hichens acquired the firm, the senior partner, Herbert West, a member of the Stock Exchange since 1890, joined the partnership together with The Hon. Laurence Alan Broderick. Broderick died on 29th January 1917. The new registration of Business Names Act 1916 required Hichens, Harrison, Woolston & Co. to register and this was done on 19th March 1917. What part Hichens played in the sale of control of Mexican Eagle Oil in January 1917 and all thereto appertaining by Lord Cowdray and his associates to Messrs. Smithers acting on behalf of the Standard Oil Company is not clear. However, commission on the deal was divided one-third to Hichens, and two-thirds to Mr. H. W. S. Chilcott, acting as an agent for Smithers. Mr Dennison became a partner in 1920 and initially was entitled to a salary of £500 a year. Later he fell ill and his salary was reduced to £200 per annum. Eventually the partners decided to discontinue the payment because the firm was incurring losses. Mr Dennison did not have the advantage of today’s Employment Tribunals and argued for the continuance of the payment before Mr Justice Simonds in the Chancery Division of the High Court but lost his case. In May 1931, 1,700 sq. ft. of offices was obtained in Gresham House, 24 Old Broad Street (at a rent of £2,000 per annum) for a 21 years term. At the end of the lease Gresham House Estates Company gave notice of their wish to retain the premises. Hichens negotiated a short stay until February 1959 at a higher rent of £3,676 per annum and then moved to 3 & 4 London Wall Buildings in London Wall. Herbert West (Senior Partner at the time) gifted the West Gate to Wellington College in 1927 in memory of his wife Mary Theresa (1874-1926). His son, Horace, was Head of the Benson at the time. The gates stand at the entrance to the College. Horace read law at Magdalen, Oxford, for two years, until his father decided he was not working hard enough and in any case he was needed in the office at Hichens. Nevertheless Horace continued to read Law and was called to the bar in 1931, remaining a member of Lincoln’s Inn throughout his stockbroking life. Another distinction was that in the war years his intellectual capacity was soon recognised and he was posted to Intelligence, first in M18 at the War Office and later at Bletchley Park working on Ultra. Like his father, Horace West became Senior Partner and played an active part on the Stock Exchange Council until 1973 continuing the support given by Hichens for so many years. Some months later Eustace Mordaunt gifted a similar gate at the other end of the Drive named the Mordaunt Gate. Unlike the Wests the Mordaunts had a long history of sending their boys to Wellington as far back as 1885. Nigel John Mordaunt was at Wellington for six years until 1926 and later became a Blue Button in Hichens. Much later Nigel was appointed senior partner of Wedd Durlacher Mordaunt & Co. and later become Sir Nigel Mordaunt, Bt, MBE, The audited accounts of Hichens for the year to 31st December 1932 show that the business was less profitable than in 1917 with commissions at £41,815 resulting in Partnership profits of £13,150 (against £7,330 a year earlier) after rents £2,082, staff salaries £12,172, telephone and telegraph £364, postage £361 and interest of £1,282. To achieve this partners had a bank facility of £170,000 and contributed a joint capital of £11,591. Horace West took the larger share of profits with £4,711, followed by Leonard Harrison £2,355, John Blundell £2,000 and the remainder shared between four others. The following year 1933 partnership profits climbed to £25,253, held at £25,912 in 1934 and then in 1937 shot to £38,275 before dropping to a loss of £5,304 in 1941 and thereafter climbing steadily to £49,512 in 1947. After the Second World War Mr David Orr and Mr Tony Pickford returned from military service to rejoin the firm. On 24th November 1946 it was agreed the cash capital would be £15,000 and the security capital (deposit with the banks) £60,000. The capital was contributed mainly by Mr Harrison and Mr West though the profits were shared Mr Harrison 28%, Mr Blundell 26%, and Mr West 20% and Mr Blandon 24% with the balance shared between the remaining partners. In 1951 Michael Lawrence Harrison retired from the firm but the family connection was maintained through Giles Hoare, his cousin, who served twice as an equity partner from 1953 until 1973 and again from April 1979 when he was persuaded to re-join the firm for four years. When Michael Harrison died in 1967 his home was at Chesham Place, though he had lived in Salisbury for part of his life. His estate was valued at £56,546 on which tax of £19,830 was paid. On 18th March 1953 Hichens, Harrison Woolston acquired the firm of Snell Lovell & Co of 20-24 Moorgate consisting of Frederick Stafford Lewis, brothers Percival Ernest Hulford and Jack Percival 13 In 1958 the Partners of Hichens exploited a tax benefit created by placing the firm’s administration in a newly created company Hichens Service Co and for the six years to 1964 the largest single partnership cost was the service company charge. The Partners also arranged a sale and leaseback of the lease on 3 & 4 London Wall Buildings before the introduction of Capital Gains tax in 1965. Whereas the rent had been £3,500 before 1965 it was £20,513 in 1966 and more than doubled by 1974 to £44,688. David Orr was responsible for the flotation of Diners Club (eventually acquired by National Westminster Bank) by the novel method of ‘offer by tender’ in 1964. Some years earlier he had owned a small company called Finders Services, which promised to seek out and supply anything required, no matter how obscure or outrageous. Whilst travelling in America in the early 50’s, he was impressed with the fast growing, and still infant, credit card system. On his return home, he added credit card facilities to Finders Services; the idea took off and before long became established as a major part of the credit system. On 28th September 1966 Hichens incorporated Messrs Angel H. Hart & Co and Phillip Campbell (a Stock Exchange member since 1938) and his son Jeremy joined Hichens together with James Raymond Hope Paterson M.C., Bryan Edward Farr and James Francis Moore. The firm also included a very young dealer fresh out of military service Roland Clive McGuire, who then began his long and successful career with Hichens. Clive became a Member of the Stock Exchange in 1968. At one time, Angel Hart also had offices in Austin Friars, as did many stockbrokers because of the close proximity to The Stock Exchange. Mr. Hart, senior partner, fell to his death from an upper floor window as he landed on the spiked railings which surrounded Pinner’s Hall. Hichens was one of the first stockbroking firms to install a computer. In February 1967 the firm purchased an NCR Computer in conjunction with Norris Oakley Bros. a stockbroker located in Telegraph Street, London. The new system required programmers and systems staff and the biggest refrigerated room that could be installed in London Wall Buildings. Eventually, the machine was sold to a supermarket for controlling its stock levels and Hichens started again with a smaller and even more powerful model. In February 1970 Dennis Bailey and Russell Stacey (a dealer) joined Hichens from Strauss, Turnbull & LAWRENCE HARRISON 1834-1899 Member of the Committee of The Stock Exchange 1875-1890 Hulford with George Edward Arthur Hellings. As a result the Woolston was dropped from the name. No doubt the individuals had first become friends when Snell Lovell occupied offices in Pinner’s Hall, Austin Friars in the early 1930’s. The incorporation of Snell Lovell & Co. boosted the income of Hichens coupled with a flip-up in market activity. Commissions rose from £34,752 in the year to March 31 1953 to £76,718 in 1954 and on to £104,230 in 1955 with the results that Partnership profits which had been as low as £4,975 in 1953 climbed to £31,591 in 1954 and on to £39,470 in 1955 before falling back again. The recovery in the market in 1959 prompted a recovery in Partnership profits from £26,888 in 1959 on to £35,453 in 1960 as commissions reached a new peak of £149,970, a level that was not exceeded again until 1968 when commissions topped £294,949 for the first time generating Partnership Profits of £104,501 (equivalent to £1.53 million today). A surprising feature of the Hichens Profit and Loss accounts has been the modest amount spent on Rent & Rates and the long fixed term leases. Throughout the 1950s expenditure on Print & Stationary regularly exceeded the payments for Rent and Rates. Over the 10 years to 1960 the average annual amounts spent was £3,292 on Rent & Rates, £3,408 on Print & Stationary, £1,319 on telegraphs and telephones and £816 on Postage. 14 Co. On 1st May 1971, Clive McGuire, Dennis Bailey, Paul Boylan and Ronald Orr (son of David Orr a partner since 1946) joined the then partnership making nine partners. Paul Boylan had joined from Greenwells where he had been Head Dealer. Paul had a particular energy for late nights. Give Paul a mathematical task at 10 p.m. and invariably he would have the solution by 2 am! The four new Partners had merely asked for 50% of the votes which at the time Horace West (Senior Partner) remarked “we will willingly grant you new boys 50% of the votes as the Partners rarely hold meetings and certainly do not vote”. Weekly meetings began a month later and took so long that they had to be transferred to a private dining room at the Great Eastern Hotel and often lasted until mid-night. One Partner (often Giles Hoare or Graham Pratt) supported the ‘new boys’ and the emphasis at Hichens moved to achieving results both for clients and the firm. The first year of the enlarged Partnership was the 12 months to April 1972. Commission exceeded the 1971 level by almost three times not quite exceeding £1 million for the first time. In that year the Partners began to develop the policies that provided the bedrock for the next 30 years. Rather than chase bargains regardless of the level of commission the firm sought trades with high commission and cut the staff levels from some 200 people (over five floors) in 1972 to 20 in 1974. At the same time fixed costs were reduced in favour of variable costs. In achieving the objective the Partners did not make anyone redundant. In the first year the enlarged partnership profits equalled the aggregate of the previous four years and over the first three years exceeded the aggregate profits of the previous 13 years. Hichens has since remained profitable every year for 30 years despite the ups and downs of the stockbroking business. In good times executives in other firms have regularly said ‘why does Hichens not spend on new offices or new services?’ and in bad times those same people have regularly said ‘you must be so pleased you did not expand’. Stockbroking is a business where the income increases or decreases by the minute and therefore it is essential not to impose a high fixed cost structure, which will take months or years to unwind when times are bad – which they are every few years. Hichens had moved in February 1959 to offices on several floors at 3 and 4 London Wall Buildings leased from the City Corporation of London. In 1975 the lease on these offices was sold by Hichens to Slater Walker Investments Limited who occupied the space until 1988. With the benefit of the sale the firm moved in December 1974 to its present building then known as Broad Street Avenue. At the time this was thought to be the only Street Avenue in Europe. Later the name was changed to Bell Court House, 11, Blomfield Street, London EC2M 1LB The move occurred in the depths of the 1972-74 banking and property crash. At the time it was suspected that a major clearing bank was about to collapse and the Partners promised the staff they would be able to leave the office early on Christmas Eve in 1974. The events were somewhat different as the major institutions had begun to buy equities and instead of closing the office at noon as promised Stock Exchange contracts were still being printed at 5 p.m. Among the more controversial of Hichens’ endeavours was the attempt to raise £150 million for the British Steel Corporation (“BSC” now named Corus) through a novel scheme linking the return to institutions with the selling price of steel, and to some extent Retail Price Index. Effectively, this was years ahead of Indexed Linked Government Stocks. The scheme was not a complex one, but the Bank of England realised the institutional appetite for such schemes and feared that it might endanger the Government’s funding programme via the sale of Government gilt stocks. The plan was first proposed to Sir Monty Finniston by Dennis Bailey and after much discussion and amendment; the final scheme emerged and was entitled ‘The British Steel Corporation Counter-Cyclical Stock Financing by Institutional Funds’. The idea was that BSC could reduce the adverse effects of the cyclical nature of demand for steel by selling its basic products to financial institutions at times of low demand and that institutions would then be able to take advantage of the next upturn in prices by selling the steel back to BSC. Protections were built in to link the selling price, to some extent, with the Retail Price Index. The mutual advantages of the scheme were considerable. BSC, then operating at under capacity, would have been able to keep the furnaces going, thus maintaining employment, reducing losses and providing off-balance sheet financing. Later, when the steel was bought back – in theory at times of high demand and prices, when capacity was not sufficient to meet demand – the BSC would have earned another profit from the finishing of the raw steel into products, and would have reduced imports. On the other hand, the institutions were holding what was in effect a British Government fixed 15 interest security, index linked, with equity participation. It was almost another 10 years before the Treasury and Bank of England introduced Indexed Linked Government Stocks. The plan at BSC was to manufacture the steel at the most efficient plants and to stock steel that provided the biggest profit margins thereby boosting the underlying benefits to the steel group. The Treasury demanded that the scheme be made available to pension funds and initially it was thought this was impossible because pension funds can only buy securities and not commodities. Eventually, a system was developed to permit the pension funds to create a wholly owned company to which they would make a loan at a rolled-up rate of interest. The loan would be used to fund steel and interest would accumulate until the steel was sold and the loan repaid with profit and repaid to the pension fund with interest. The scheme was approved by the Inland Revenue. There has often been criticism that the City and financial institutions are hide-bound and too conservative in their investment decisions. On this occasion their willingness to assist and participate in this totally new investment concept must prove those critics wrong, for within a very few weeks commitments for £72 million, the minimum amount desired by BSC had been obtained. It was at this time that the Treasury having earlier supported the BSC scheme raised its objections. Among its arguments were that BSC came under the jurisdiction of the Treasury, and that the scheme allowed the BSC too much financial freedom. After much argument, Sir Monty met Edmund Dell and Harold Wilson in Downing Street and the Government itself agreed to finance the scheme. Sir Monty no doubt had a feeling that the scheme might not eventually succeed because half way through the project he invited the partners of Hichens to reduce their proposed fee at the top end and replace it with a failure fee. Initially, because the project was going so well the partners were reluctant to make the change. Finally, the partners agreed with the Board of British Steel Corporation and when to everyone’s surprise the Bank of England blocked the scheme the first move by Sir Monty was to pay Hichens its substantial fee. The Bank felt that the scheme would encourage the institutions to press for Indexed Linked Government Stocks making it difficult to raise Government funds by conventual’s issues. The Bank first introduced Index Linked Gilts in 1984 and in 2003 some eight stock exists of a total of 34 Government issues. 16 For nearly 185 years until Big Bang in 1986 it was a Stock Exchange requirement that stockbrokers occupied offices within 250 yards of the floor of the market. It was also necessary for the dealers to occupy offices around the floor of the market commonly known as ‘the Box’. In 1935 Hichens rented a Box from the Stock Exchange at No 2 Capel Court and 2 Shorters Court for £250 per annum from 25th December 1935. For an extra £13 per annum the Stock Exchange was required to provide ordinary cleaning of the premises. In November 1940 the rent was decreased but later rose again to £250 per annum in December 1945 and to £325 a year in 1948. The dealers now concentrate mainly on institutional business, which accounts for some 50% of Hichens business. They are housed on the 3rd and 4th Floors of Warnford Court located immediately behind the London Stock Exchange. A remarkable feature of Hichens is the high proportion of institutional business maintained by the firm at 50% of the total income. This is the responsibility of Clive McGuire who has maintained long and good relationships with the clients and jobbers, now known as market makers, based on the old Stock Exchange motto “dictum meum pactum” or “my word is my bond”. Also the firm has often been the bedrock buyer of shares involved prior to takeovers, because it has been able to deal without causing suspicions or fuss in greater number than the normal market size. Corporate Finance has always been an extension of stockbroking. Raising money for companies, introducing businesses to the stock market is all part of the day-to-day business. Over the years Hichens has been engaged in a host of new issues. In June 1980 Kennedy Brookes was floated after the raising of a mere £80,000 to capitalise the business at £800,000. It subsequently expanded rapidly taking over the restaurant business of 104 Harley Street from Professor Rowland Smith, Mario & Franco, Wheelers from the Bernard Walsh family and the London Pavilion to become a very substantial group with interests in outside catering, hotels and restaurants. In that time Hichens placed shares on a regular basis, underwrote issues and launched a £10 million Convertible Loan Stock. Eventually, Trust Houses Forte acquired the business for a very large sum. Hichens also launched Crusts, a restaurant chain and Lodge Care the nursing home empire of Nigel Balcombe and John Apthorp. John should have had enough to occupy his time developing the Bejam Group but still enjoyed the success of Lodge Care! By the mid 1980s Tony Pickford had developed into the position of lunchtime partner a position he maintained well into the 1990s having served as Senior Partner (until April 1986) longer than any of his predecessors. By the late 1980’s although the firm was large, and strong the only equity partners for some years had been Clive McGuire and Dennis Bailey. On 5th May 1989 the Partnership became an unlimited company and after a quick Board Meeting (the only one that included a gin and tonic) held at the Savoy Hotel on Sunday evening the 7th May the company became a public limited company on Monday 8th May 1989. On 22nd February 2001 the two shareholders enjoyed a lunch with Wallace Wormsley a Director of Gensec Bank, a subsidiary of Sanlam of South Africa. As events moved on Sanlam expressed a wish to buy Hichens and for the existing shareholders to continue running the business. Eventually on 22nd February 2002 Sanlam took control of the shares effective from 1st May 2001 with the existing management remaining in situ. Since mid 2002 Hichens has funded the development of Hichens Investment Management – concentrating on discretionary accounts from a Regent Street base – though the plan is for this branch to become self-regulated in due course. The project has been successful and by the end of December 2002 had gained £55 million of funds to manage – though clearly costs run ahead of income. Whilst the two partners have over 30 years experience each with Hichens, two back office employees can claim longer involvement. David Dowsey first joined Hichens on 2nd August 1965 on a salary of £375 a year. Between 1970 and the early 1990s he worked for other City firms but came back as an executive in the settlement area. Leslie Taylor joined the firm aged 16 years, in 1936 on a salary of £50 a year, with the promise that it would be raised by 5 shillings a year until it was running at the rate of £150 a year, after which increments would be conditional upon his progress within the firm. Fortunately, he did well and when he retired in 1994 had become the longest serving employee and the General Manager. Amongst former employees and partners were Terence Marne O’Neill, who later became Prime Minister of Ulster; John Stuart Cumming, a research analyst for some years and a Partner for two, became a Director of Hambros Bank and Derek Gascoigne, a partner for 13 years, became Chairman of Army & Navy Stores and Tanganyika Concessions. Ted Lewis left the Hichens partnership to establish his own stockbroking firm, E.R. Lewis & Co. in the summer of 1932. He also took a substantial interest in Decca and became its Chairman and was responsible for making it a major force in the electronics industry for which he was later knighted. His family sold out just before his death and eventually became substantial shareholders in Vodafone and Racal. Richard, his son (a Stock Exchange member since 1951) continued to run E R Lewis for a time. The business suffered a loss and Richard joined Scrimgeour Vickers in the later 1980s. In 1991 he joined Hichens and worked with a small team until he retired aged 74 years on 24th September 2002 in the depths of the 2001-2003 crash. The investment services provided by Hichens today are not unlike the traditional stockbroking offered in the 18th century. Hichens will manage portfolios on either a Discretionary or Advisory basis, it will manage cash deposits, raise monies for companies, underwrite issues and buy and sell securities for institutions on an agency or principals basis. It also deals in Contracts for Differences (CFDs), Traded Options and Futures. Hichens possibly provides a wider range of tax assistance and wealth management now but the service is just as personal and private as 200 years ago. REFLECTIONS The history of Hichens, Harrison & Co is not well documented, the earliest records being dated July 1803, one year after the Deed of Settlement which established The Stock Exchange, as we know it today. It is difficult now to appreciate the conditions of those times. Travel was by horse and carriage, there were no telephones, no telegrams, no penny post, no railways, no police force, not even gas lighting, which was introduced in 1807. Yet there was a flourishing and prosperous trade in stocks and bonds. The Industrial Revolution was yet to be born and the banking system was still in its infancy. Although The Stock Exchange was formally established in 1802, it was much earlier that dealings in stocks and shares developed. It was in the reign of William III that stock dealing first became a viable business. William discovered that it was better to borrow monies for long periods rather than short, pay interest promptly and make stock easily transferable. That discovery started the 17 Partners in Hichens, Harrison Co. 1803-2003 Year of Admission to Stock Exchange 1806 1813 1820 1855 1855 1861 1866 1894 1896 1900 1912 1890 1904 1889 1911 1908 1920 1925 1924 1926 1930 1928 1933 1934 1933 1921 1944 1945 1911 1948 1947 1948 1954 1955 1955 1958 1959 1962 1951 1957 1966 1938 1966 1968 1968 1955 1968 1969 1971 1969 1948 Partnership Term 1803-1864 1813-1849 1820-1881 1855-1899 1855-1906 1861-1921 1866-1908 1894-1943 1896-1912 1900-1916 1917-1949 1917-1949 1917-1927 1917-1918 1920-1921 1920-1935 1921-1949 1922-1925 1924-1928 1927-1951 1930-1937 1930-1943 1932-1972 1935-1943 1945-1970 1942-1961 1945-1986 1947-1957 1953-1958 1953-1973 1953-1962 1954-1974 1956-1961 1957-1972 1957-1966 1961-1971 1962-1974 1964-1966 1965-1974 1965-1967 1967-1974 1969-1975 1969-1975 1969-1974 1971-1989 1971-1989 1971-1989 1971-1985 1974-1976 1975-1978 1979-1983 Name Robert Hichens William Hichens Frederic Harrison Lawrence Harrison Andrew Kinsman Hichens Robert Hichens Camden Harrison John Knill Jope Hichens Leonard Frederic Harrison Basil Snaith Hichens James Byrn Hichens George Charles Neilson Herbert Edgar West Lewis Edwardes The Honourable Laurence Broderick Harold Evelyn Talbot Agar George Dudley Dennison John Brandon Edward Robert Lewis Thomas Munro Darling Michael Lawrence Harrison John William StJohn Whitehead Earnest Federick Orby Gascoigne Horace (Herbert) Henry West The Honourable Francis Stewart-Mackenzie Davis Lewis Davidson Orr Horace George Blundell Anthony Ernest Ingham Pickford Charles Richard Garrett Frederick Stafford Lewis Giles Newham Gerry Hoare John Williams Douglas Alexander James Laidlaw Lord Savernake Roden Powlett Graves Orde Walter Henry Phillips Edmund Leigh Grundy Graham Eldon Pratt John Stuart Cumming Archibald Gunn Harold William Singleton Michael Anthony Pickford William Philip Campbell Ronald David Douglas Orr Neil Colin Barker Roland Clive McGuire Jeremy Philip Campbell Dennis Bryan Bailey Paul Desmond Boylan Keith Bashford William John Voss Giles Newham Jerry Hoare 18 National Debt in 1693, when £1 million was raised, a year later the establishment of the Bank of England and the issue of a number of lottery loans gave rise to the need for an after market on a bigger scale and many dealers were active. At this time brokers did not have a formal meeting place though they could often be found around the Royal Exchange, the Rotunda in the Bank of England or at popular taverns. In 1720 the so called ‘Bubble Act’ was introduced to protect the unwary investing public. In the last years of the 18th century the expenses of the war with France led to pressure on Pitt’s government and at one point a financial panic ensued with Government stock prices and the few leading share prices halving in a short time. In 1797 the Bank Restriction Act became law and ended the need to match the amount of cash and credit outstanding to the quantity of gold in the vaults. The Bank of England – then a commercial enterprise – saw its job as providing as much currency as borrowers could match with suitable security. This led to rapid inflation and the cost of living doubled by 1812. It also brought about the Great Wheat Gamble of 1799 and the frenzied rush to get into the newly opened Brazil trade in 1809. The Bank freely poured out funds to any speculator on the most reckless of schemes. One of the more interesting issues of the time was a highly original enterprise founded to manufacture butter in Buenos Aires. The capital was subscribed, a shipload of Scottish milkmaids sent out, and ‘the wild cattle of the River Plate led captive to the milking stools’. Latin American shops were filled with butter, but regrettably no one had thought to enquire whether the Argentineans liked butter. They did not, but preferred oil and the enterprise floundered. It is not recorded what became of the stranded milkmaids. By the end of the Napoleonic Wars in 1815, the Stock Exchange had become well established. Stock broking firms tended to be quite small but the distinction between broker and jobber clearly established. Information was often the key to successful investing, just as good analysis is today. It was strongly rumoured in 1815 that Nathan Rothschild made several million pounds by having advance news of the Battle of Waterloo. As Government debit expanded from £456 million in 1801 to £745 million in 1815 a large after market developed creating the largest stock exchange in the world and in turn beginning to encourage companies to raise money. By 1824 the depressed state of trade in Britain was drawing to an end and companies engaged in canals, docks, shipping, insurance, and waterways were beginning to discover the benefits of raising money via the Stock Exchange. During 1824 some 600 companies were created with a nominal capital of approximately £375 million. Whereas in the early days of the market British Government stock dominated the markets, by 1853 companies and foreign issues accounted for some 30% of the £1,200 million of the paid-up capital values. The biggest equity segment was Railways, accounting for £194 million or 16% of the total followed by foreign issues accounting for 8% of the total. At this time the London Stockmarket was by far the biggest in the world. Once the ticker tape was introduced in 1867 and telegraph became more widespread interest expanded rapidly. By 1905 quoted shares had a paid up value of £11,208 million. This figure of paid up capital double by 1950 when its market 19 value was placed at £25,062 million and by 1990 the market value was £2,098,491 million. By 1821 the Bank was forced to resume convertibility, which created a sharp contraction in credit and had a savagely deflationary effect on industry. By 1825 deflation had run its course, prices had started to rise and the whole country became involved in a hectic bout of speculative investment. By the end of the year, as is their nature, the bubble burst, and it was found that prospectuses calling for £150 million had been issued. The Banks were saddled with mortgages and worthless shares, taken as security. The first railway stock to be issued was from the Stockton & Darlington Railway Company in 1823. This was the world’s first passenger railway. By 1840 nearly 3,000 miles of railway track was either approved by parliament or already installed and a property and trade boom developing in a manner that had not been possible before. Such is the greed of investors that most well founded up trends are followed by investment mania and eventual market collapse. It all began with the South Sea bubble, followed by the foreign stock mania and in 1847 the aftermath of the railway boom. Similarly, though less dramatic, financial dramas continued for many years, notably involving investments in North America, and in 1844 Sir Robert Peel introduced the Bank Act, which separated The Bank of England into two distinct departments. The first was The Issuing Department, which concerned itself only with the currency, and the second, The Banking Department, which remained in business to make profits from lending. It was at this time (24th July 1840) that Hichens opened an account at The Bank of England which is maintained to this day. It was also at about this time that Hichens assisted Lloyds Bank, then still a Birmingham private bank. A rumour circulated that Lloyds notes were being refused and a run developed. The circumstances are best described in ‘Lloyds Bank in the History of English Banking’ published in 1957: ‘Lloyds was in fact in no difficulty – until the unexpected demand for gold descended upon them. Their first step was to go to the Birmingham branch of the Bank of England, through which they were by now accustomed to draw on London funds. The branch came to their aid with that newfangled device the telegraph, in order to mobilize Lloyds’ resources in London, against which the Bank of England could hand over gold in Birmingham. They called part of their balances with Alexanders, the discount house, and instructed Hanburys (their London agents) to sell £8,000 Exchequer Bonds and £3,500 Exchequer Bills. £12,000 was at two day’s notice with Hichens, the stockbrokers; due notice was given to withdraw this sum, but Hichens waived the second day’s notice. All this was put to the credit of Lloyds at the Bank of England. Two days later they believed the worst over but, as the weekly wage day of the local manufacturers might involve further exceptional demands, they telegraphed to Hichens to sell the remainder (£16,000) of their Exchequer Bills, and took preliminary steps towards mobilizing further resources, including some Bank of England Stock. The partners were, however, right in their belief that the storm was passing and when, two days later, a wealthy local family offered assistance, Lloyds was able to say “that all was well” ’. By 1841 a substantial number of records was available and in that year the City population was recorded as 135,008, a figure that subsequently fell as homes were made further afield no doubt as transport became more widely available. By 1881 the City population was down to 50,652 while in Middlesex it was rising strongly and beginning to match the large industrial county of Lancashire. In 1841 the population of Lancashire was 1,667,054 rising up to 3,454,441 by 1881. In The interior of The Stock Exchange in 1809 – the earliest print of The Stock Exchange. The original is a wood-engraving, later hand coloured. 20 In 1870 the London and Cambridge Economic Service began to calculate an index of share prices and as a result recorded the good years 1870 to 1874 when the new index moved up 30.9%. The subsequent drift to 85.2 in 1887 before the boom years between 1892 and 1899 when the market index spurted 57%. From 1900 to 1915 the upward impetus was lost and the market moved sideways until a series of huge oscillations began. The up trends were steep and un-interrupted but equally the down swings were as bad as the 1972-74 crash, the 1987 crash and the recent 2000-2003 down leg. In the early 1900's the swings were blamed on the trade cycle, whereas in recent times investors have accepted that market sentiment is the underlying factor. The old Stock Exchange (with much top-hatted activity) in Capel Court, built by James Peacock in 1801-1802. Engraved by A Cruse from an original sketch by Thomas Hosme Shepherd – the Master recorder of the period. contrast, the population of Middlesex rose strongly from 1,647,018 in 1841 to 2,920,485 by 1881. It did not become the most populated county until the early 1990’s. Nevertheless, the population of London exceeded one million long before Paris or New York. The last major banking crisis of the 18th century was the collapse of Overend and Gurney in 1866, known as ‘The Banker’s Bank’ and the most highly regarded of all the private banks. The famous old discount house had promoted young imprudent partners who had taken the business into new and un-chartered areas such as grain trading, ship owning and railway finance which tied up capital. The result was a failure because assets of only £11 million failed to cover the liabilities of £19 million. In this crisis like many before it Hichens lost money and this is evidenced by the particulars from Robert Hichen’s estate which showed he still had a small deposit with the failed bank. At last The Bank of England dropped its pretence of being just another competing bank and became the ‘lender of last resort’. This fact, together with the growing strength of the joint stock banks, saved the day and created the stability of the present-day banking system. The London Stock Exchange formally came into existence in 1801 and by the first annual renewal date had 498 members. By 1905 there were 5,567 members. By 1920 the number of Stock Exchange members was down to 2,006, by 1960 to 718 before the number began a long downtrend towards big bang in 1986. In 1928 the Financial News (later to join the Financial Times in 1945) began to calculate an index of industrial companies with a market capitalisation of £2 million or more on the last Tuesday of the month. The base figure was 100, which was very close to the base figure of 100 when the FT 30 share index of leading equities was first produced on a daily basis in 1935 using a geometric calculation rather an arithmetical index. This index reduces the extreme movements and tends to give less emphasis to high priced shares. The initial index was 100 on 1st July 1935 and the latest index number today is 1532. Tracking the index backwards to an earlier index record in 1875 the equivalent level would have been 36 rising up to 100 in 1935. The 30-share index touched a low of 49.4 on 26th June 1940, a peak of 4198.4 on 19th July 1999 (well before the internet market peak in March 2000) and now stands at 1532. The stock market has over its life enjoyed and then suffered many booms: to name a few the South Sea Bubble, the railway boom, the gold boom, the rubber boom, property boom, mobile phone boom and more recently the internet boom. This catalogue of excitement surprisingly seems to occur every 3 to 5 years with regularity. At the moment no industry or sector seems to be a likely candidate to head the next boom. One thing is certain, however, there will be more booms and more crashes and more booms to follow! This thumbnail sketch of the early years of London’s financial development covers the period of the partnership of both Robert Hichens and Frederick Harrison and offers testimony to the turbulent character of the period. It was against this background that both men established considerable fortunes. 21 Events that influenced the development of the Stockmarket 1666 Merchants and dealers begin to congregate in the second Royal Exchange. 1698 New East India Company merges with former Company to creat United East India 1698 First stockbroker begins issuing list of stock prices from Jonathan’s coffee house. 1720 Bubble Act introduced to protect unwary investors. 1724 South Sea Bubble bursts, leaving many investors ruined. 1764 Rotunda at the Bank of England used as a marketplace for dealings in stocks. 1786 Government broker appointed. 1789 Closure of the Continental bourses was caused by the French Revolution. 1802 The Stock Exchange opened in Capel Court. 1803 Robert Hichens in business as a stockbroker. 1805 Nelson destroys combined French and Spanish fleets. Nelson killed during the battle. 1807 General use of gas lamps. 1815 Defeat of Napoleon at Waterloo marks end of Napoleonic wars. 1825 Stockton and Darlington Railway is opened. 1833 Factory Act passed, prohibiting children under the age of 9 to work in factories. 1837 Telegraph used more widely. 1838 Robert Hichens elected Chairman of The Stock Exchange. 1840 Penny Post introduced. 1854-1856 Crimean War fought by Britain and France against Russia. 1855 Daily Telegraph first morning paper at 1d. 1872 Ticker Tape introduced into America. 1875 Suez Canal purchased from Britain. 1878 Telephones installed in The Stock Exchange. 1879 Electricity first put to domestic use. 1880 Extension to Stock Exchange known as the Gorgonzola Hall. 1897 John Knill Jope Hichens elected Chairman of The Stock Exchange. 1899-1902 Boer War in South Africa. 1905 More widespread use of Motor cars. 1911 National Insurance provides sickness and unemployment benefit. First World war. Passenger use of Aircraft in Europe. General Strike. Institutional business begins to impact stock market business levels. 1929-1932 Share prices on Wall Street drop 80%. 1939-1945 Second World War. 1945 Japan surrenders after America drops atomic bombs. 1948 National Health Services established. 1950 Outbreak of Korean War. 1956 British and French forces invade Egypt after nationalization of the Suez Canel. 1959 Oil is discovered in North Sea. 1962 Cuba crisis. 1971 Decimal currency introduced. 1972 The Queen opens new Stock Exchange Building and market floor. 1973 Britain joins The European Community. 1972-1974 Property and secondary Banking crisis-crash. 1978 Use of Fax becomes widespread. 1982 Argentina invades Falkland Islands and British Task Force regains control. 1983 Minimum fixed rates of stockbroking commission cease and brokers compete. 1984 Miners strike results in power cuts. 1986 Big Bang results in elimination of division between stockbrokers and jobbers; market floor and gives freedom to accept outside shareholders. 1987 Market crashes. 1989 Berlin Wall falls. 1990 Use of internet and data lines become widespread. 1991 Commonwealth of Independent States created in former Soviet Union. 1991 First Gulf War follows Iraq’s invasion of Kuwait. 1997 Hong Kong reverts back to China after 155 years. 2002 On September 11th the twin towers in New York destroyed by terrorists. 2002 Firemen’s Strike. 2003 Japanese market index continues its post 1990 decline to reached new low. 2003 America and Britain invade Iraq and remove Saddam’s regime. 2003 Stock market show sign of reversing the 2001 to 2003 swinging decline. 1914-1918 1919 1926 1930 PRINCIPAL AND AGENT The sum involved was insignificant, the expenses of the case high, but two questions of principle vital to stockbroking were resolved – the liability of Agents employing brokers to sell shares and the liability of sellers of shares for acts done by registered owners of the shares sold. In a letter dated 25th April 1939 to Hichens, Harrison, Woolston & Co. (‘Hichens’), a firm of solicitors, Jackson & Sons (‘Jackson’) issued instructions to sell for Miss Lucas £250 Consolidated Ordinary stock in the Bristol Waterworks Company for the best price obtainable. Hichens found that the only effective selling market at the time was Bristol, and arranged with Messrs. Evans & Co., a Bristol firm of brokers, to sell the shares for them, which they did. The certificate and an executed transfer were 22 duly delivered to the purchaser. Messrs. Evans then sent the purchase price to Hichens, who had sent their own cheque to Jackson. When Jackson however, sent an account to Miss Lucas with a cheque for the balance of the proceeds, the cheque was returned, and Miss Lucas wrote to the Waterworks Company objecting to the transfer being registered. Jackson took up the position that the matter was one entirely between the purchaser of the stock and Miss Lucas. Hichens argued that their purchaser was a member of a Stock Exchange, and according to The Stock Exchange rules the buying broker was entitled in default of delivery to buy in the original stock against them. Any loss involved in the transaction should therefore be payable by Jackson as principal of Hichens. Jackson in fact was under the duty to take all steps necessary to procure registration. The House of Lords (Lord Atkin, Lord Thankerton, Lord Russell of Killowen, Lord Wright, and Lord Romer) decided the case on principle independently of Stock Exchange rules, though Lord Atkin had no doubt that the transaction was subject to Rule 120 and the decision could be supported on this point. On the question whether Jackson were liable as principals to Hichens, Lord Atkin pointed out that it was the commonest occurrence in business for known agents, known to be acting on behalf of a principal, to contract in their own names. The written authority to Hichens from Jackson to sell the shares was without any qualification. The transfer from Miss Lucas conveyed nothing at all except that the solicitors had the right to have her stock conveyed. He agreed with the Lord Chief Justice and the Court of Appeal that Jackson was liable to Hichens as principals. The value of this ruling was therefore settled that in all ordinary cases of this type where there is no authority to the could say: “True I must not object to registration, but I offer you a transfer from another owner; on receiving that transfer with certificate you must pay me; but the person whose transfer I have given you in performance of my contract may forthwith do all he can to prevent you getting the legal right to the shares and I shall hold on to the price leaving you to bring a lawsuit against my transferor.” He thought the true view was that Jackson, who was seller in this case, did not, as they were bound to do, put Hichens in a position to complete the contract of sale which they had engaged Hichens to effect and that they were obliged to indemnify Hichens from the result of such breach. The importance of this decision was that it decided upon a question which hitherto had little authority – namely, what was the exact term that ought to be implied in a contract for the sale of shares in a company. The seller of shares, of course, undertakes to deliver the share certificate and a transfer signed by the legal owner. He does not guarantee that the company will accept and register the transfer. Equally, however, he agrees by implication that he will not object to registration. In this case the objection to registration came not from the seller but from the registered owner whose shares the seller had agreed to sell. But whereas a broker or other agent will not know in the ordinary course of things who is the registered owner of the shares the seller will: and it is the seller, therefore, who by this ruling ought to take the risk of the registered owner’s conduct. A DRIVE FOR PROFIT in 1814 Extraordinary panics have, at different times, taken place at the Stock Exchange. The prices of stocks and shares have risen and fallen with rapidity at the rumours of wars, foreign alliances, and coalitions. Sometimes these rumours have been proved to be mere inventions. It rarely presents any difficulties with present day communications because unfounded reports are rapidly corrected – not so in 1814 when eight well known gentlemen created a false rumour for their own gain and were charged with both profiteering and conspiracy. It was the most extraordinary conspiracy ever planned and carried out in order to bring about a panic in 1814 at the close of the great struggle between Napoleon and the allied sovereigns of Europe. Government stocks were then in a very depressed condition, and great national anxiety prevailed. contrary the solicitor is liable to the broker (or bank or accountant) as principal. On the second and even more important point Lord Atkin thought it ‘entirely incongruous’ that the contract of sale should not involve any obligation on the part of the vendor that the transferor should not remain equally willing, so far as he was concerned, that the purchaser should have the benefit of the transaction. How could business be carried on, he asked, if the vendor 23 The trial for conspiracy in the Court of the King’s Bench, Guildhall, on 8th June 1814, charged Lord Cochrane, Captain Ramdone du Bourg, the Hon. Andrew Cochrane-Johnson, Richard Gathorn Butt, Ralph Sandom, Alexander M’Rae, John Peter Hollowat and Henry Lyte. They were indited for conspiring to defraud the Stock Exchange by “circulating false news of Napoleon’s defeat, of him being killed by the Cossacks, in order to raise the price of Government stocks to a higher level than they would otherwise have commanded, to the injury of the public, and the benefit of the conspirators”. The prosecution claimed that at one o`clock on the morning of 21st February, 1814, Captain Randone du Bourg, stopped a watchman in the town of Dover, and enquired the way to the Ship Inn, at the time the principal hotel in Dover. Dressed in a grey military great coat, a scarlet uniform, richly embroidered with gold lace, (the uniform of a Staff Officer) a star on his breast, a silver medal suspended from his neck, a dark fur cap with broad gold lace, and he had a small portmanteau; Captain de Bourg an Aide de Camp to Lord Cathcart, just arrived from Paris. He claimed he was the bearer of glorious news, that a decisive battle had taken place, that Bonaparte was pursued and killed by the Cossacks, that the Allied Sovereigns were actually in Paris, and that now (that most welcome news to the Inhabitants of Dover) an immediate Peace was certain. He ordered a postchaise and four for London, and he offered to pay with some gold Napoleons. When he arrived at Canterbury he rewarded his post-boys very liberally; he gave each of them a Napoleon. Fresh horses were ordered on to Sittingbourne and the same chaise brought him from Canterbury to London, and again he gave Napoleons to all his post-boys. It was difficult to say who was first upon the road, this Colonel du Bourg or other expresses, which had been sent off from Dover with this happy news reaching London half an hour before du Bourg. Other charges were that, “Ralph Sandom, Alexander M’Rae and Henry Lyte did unlawfully hire and take a post chaise to go from Dartford, and having white cockades in certain cocked hats, which they wore; and the horses drawing the said post-chaise then and there being decorated with branches of laurel, and went over London Bridge, and through the City of London, unto and over Blackfriars Bridge, and unto a certain place called the Marsh Gate, in the parish of St. Mary Lambeth, in the County of Surrey, with intention thereby to mislead those subjects whom they should pass, and who should see them in their route to suppose and believe, and to report and rumour to other subjects, that they the said Ralph Sandom, Alexander 24 M’Rae and Henry Lyte, were the bearers to the Government of this kingdom, of great and important foreign news, highly favourable to the interests of our said Lord the King, and his subjects, and thereby to occasion an increase and rise in the prices of Government Funds in order and for the purpose that the said Lord Cochrane, Andrew Cochrane Johnstone, Richard Gathorn Butt, and John Peter Holloway, respectively should then sell and cause and procure to be sold for them respectively Government Funds at higher and greater prices than they would otherwise sell for, with a wicked and fraudulent intention, to thereby cheat and defraud the Stock Exchange and others of large sums of money.” Sandom, Holloway and Lyte were jobbers in Government Stocks and confessed their part to The Stock Exchange Committee, though they denied any participation with the other parties. The dealings in Hichens were as follows: 1814 Daily Daily Purchases Sales of of Omnium Omnium £20,000 £150,000 £95,000 £200,000 £50,000 £50,000 £200,000 £115,000 £250,000 Daily Balance £20,000 £170,000 £265,000 £265,000 £465,000 £465,000 £265,000 £200,000 £250,000 £250,000 Feb 9 Feb 10 Feb 11 Feb 12 Feb 14 Feb 15 Feb 16 Feb 17 Feb 18 Feb 19 Feb 20 Hichens was one of the four stockbrokers that handled the Gilt orders (which in current terms represented £11.16 million) and Robert Hichens was called to give evidence at the trial. For the defence it was contended and proved that Lord Cochrane was acquainted with de Bourg in honourable grounds, not arising from stockjobbing transactions, having exerted himself to get into the Navy: likewise he had authorised his stockbroker to sell his Government stock whenever he earned one per cent profit. No doubt Lord Cochrane’s distinctive Naval career favoured him. In 1809 he was responsible for the destruction of French ships in the Basque Roads delivering a crushing blow to the great Napoleon’s maritime efforts. A few years later he served with distinction in Chile and Peru, resulting in him receiving the Grand Cross of the Imperial Brazilian Order. The Jury found all the persons guilty; and the sentence passed upon them was as follows: ‘That the defendants, Lord Cochrance and Butt, should each pay a fine of £1,000; the defendant, Holloway, a fine of £500; all the defendants to be imprisoned for one year in the custody of the Marshal of the Marshalsea; and that the defendants – Lord Cochrane, Butt and du Bourg should once, during that period, stand in an open pillory for one hour, between the hours of 12 noon and 2 p.m. in the open space facing the Royal Exchange, in the City of London.’ Lord Cochrane at the time of the trial was Member of Parliament for the City of Westminster, and in the month of July he was brought to the Bar of the House of Commons, and called upon to make his defence. He most solemnly declared his innocence, and imputed great partiality to Lord Ellenborough, the judge who presided at the trial, and earnestly implored the House to institute a thorough investigation of the case. The motion, nevertheless, for his expulsion was carried; but that part of the sentence condemning him to stand in the pillory was remitted, the Government being evidently afraid to carry it into effect, as Sir Francis Burdett had declared that, if it was done, he would stand beside his friend on the scaffold of shame. So little did the electorate believe in Lord Cochrane’s guilt, that on the issuing of the new writ for Westminster he was immediately, without opposition, re-elected. To crown it all, Cochrane’s political enemies had him stripped of his knighthood, and the escutcheon of his Order disgracefully kicked down the steps of St. George’s Chapel, Windsor Castle. Lord Cochrane demurred on principle to the remission of any part of his sentence, stating that, if innocent, he ought to be publically proclaimed so but that, if guilty, the punishment was certainly not too severe. licences on an area totalling 3,484 acres. This was bordered by property owned by Shell and adjoined the successful well of the Trinidad Central Oilfield Concession. There was great rivalry between the B.A.W. Syndicate and the neighbouring Trinidad Central Oilfields and attempts were made by Winston Churchill to merge the two together. The initial plan was to drill two wells to a depth of 2,5003,000 feet. In order to achieve this it was necessary to erect a dam, obtain a water licence, and build a road for several miles to the derrick. The syndicate also devised a code for Cablegrams which would have been difficult to decipher because for every likely group of words they had a pre-arranged code. Messages ran like: JIDUO 202BU PHAR MYGVD 2UFOC XYLA2 WELYP WEKGI XEYLP SNEAV PIPARO Referring to your letter May 25th Extraordinary resolution passed June 15th Well No 1 Total Depth 14ft 1410 feet 10ft gas and oil showing full stop PIPARO TRINIDAD OIL SYNDICATE In 1920 Hichens formed a private syndicate called B.A.W. Syndicate Limited or the Trinidad Oil syndicate with £50,000 to drill for oil through a specially formed company called Trinidad Oil Concessions Limited in the British Crown Colony of Trinidad. The largest subscriber to the issue was the Duke of Bedford. The Government promised by letter dated 16th June 1920 to grant prospecting The delays in commencing drilling were far greater than expected. In 1921 the wet season was unusually long and hurricanes hit the island. When drilling began in early 1922 at 615 feet, water and sand were encountered which had to be cased-off and cemented. This took a further two weeks alone for the cement to dry and later it was discovered that the hole had moved 12 feet off perpendicular due, it was thought, to the use of an ‘eccentric’ bit. This had to be corrected and then three tons of cast iron was required to strengthen the borehole. At 1,645 feet black shale was encountered. Finally, at 2,250 feet the geologist, Cooper-Scott, reported, “the absence of oil bearing sand is very discouraging, and if the faces continue I cannot advise continuing in depth below 2,500 feet”. At a total depth of 2,515 feet drilling ceased and the manager was recalled to London. Among the subscribers had been Duke of Bedford, Sir Walter Lawrence, Sir Thomas Robinson, Sir Stanford London and the Partners of Hichens. 25 WHAT OTHERS HAVE WRITTEN ABOUT US THE FINANCIAL TIMES THE LEX COLUMN 12th November 1975 A target figure of around £75 million makes British Steel’s current fund-raising efforts look ambitious as well as novel. The idea is that BSC will effectively sell steel to the institutions, with an under-taking to buy it back in the three years to 1979. The institutions will receive an annual return linked to the RPI, with some kind of kicker on repayment dates linked to the price of steel. No quoted securities will be involved, but there are provisions to allow for early repayment at a penalty to the lender; it is not clear whether it will be possible to make a market in BSC’s liabilities. The scheme could hardly have got as far as it has without the blessing of the authoritieswhich contrasts with frosty official attitudes to index linked schemes proposed by the private sector over the past yearand it has presumably also been HICHENS FAMILY TREE The information contained in the Hichens Family Tree is drawn from the History of St. Ives, family information, information at St. Ives Church and general research of Parish, Borough, Births, Deaths, Marriages, Wills and other records. A vast amount of information is available but not all sources confirm the data with one another. At the parish of Illogen data is available on baptisms as it is at St. Ives but it is not always possible to fit this to a specific family branch. After Robert moved to London much of his family history is available in East Dulwich and Camberwell as well as the City of London. Census information usefully confirms other data and occasionally adds an indication of the life style, especially after 1841 as profession or occupation were included together with ages and relationships in the household. For example, the St Ives 1851 census states that Richard Hichens (son of Richard Hichens and Sarah Hanning) was a surgeon to the Royal Artillery and unmarried living with his Footman, cook and servant. In the 1891, census John Knill Jope Hichens lived at Frognal, Sunninghill (before moving to Beech Grove) with his wife, two daughters, a Butler and six servants. It also seems some family members emigrated to New Zealand and others to America. In so far as the five members of the family that joined Hichens, Harrison & Co are concerned, the data is supported by more than one document. Robert Peverell Hichens was awarded the DSO as shown on the Family Tree. In the Guinness Book of Records, he is mentioned as being the most highly decorated Royal Naval Voluntary Reserve Officer in the Second World War. He was awarded the DSO and Bar and the DSC with two Bars (which takes some beating) and was mentioned three times in dispatches for his brave actions at Dunkirk and for other heroic actions during his time with coastal forces when he took part in 148 operations and commanded in 14 actions. A solicitor by profession he practised in Cornwall. He was killed in action in 1943 and is survived by his two sons Robert and Anthony. 26 cleared by the Inland Revenue. This is crucial for the gross funds, which could be liable to pay tax if this were deemed to be a trading operation. In fact the pension funds appear to be more enthusiastic about the proposals than the insurance companies, some of which are actively hostile. Their worries include the short life of the scheme, the political connotations of the RPI, and the outlook for steel prices during a recession. All the same the suggestion is that the scheme is already a good way down the road towards meeting its targets, and the hope is that formal details may be available next week. For BSC, a figure of £75 million does not represent much more than a week’s turnover. But if the money can be treated as off-balance sheet finance, which seems possible, it could have an important bearing on its borrowing limitations. These were set at £1.25 billion under the 1972 Iron and Steel Act: borrowings ranking for this purpose totalled £751 million last March, but with losses currently running at an annual rate of around £250 million and very heavy capital commitments, BSC could well be running up near to its limits this year. This is obviously another point which potential subscribers want to discuss. The plan is apparently the brain child of brokers Hichens, Harrison and Company, a sixmember firm not normally associated with fund raising on this scale. Merchant banks and the major brokers have been messing about with index linking ideas for well over a year now, so if this scheme works it will represent a real feather in Hichens’ cap. 27 OUR OLDEST HICHENS DOCUMENT As part of our research we asked the National Debt Office of the Bank Of England for information on the three per cent Annuities (1751). They state £2.1million of stock was issued for the purpose of paying off those proprietors of South Sea Annuities who had not, on 30th May 1750, signified their assent to the reduction of interest on the debt due to the South Sea Company in the previous year. At the date of Mr Pitt’s Sinking Fund, in 1786, these Annuities had been reduced to £1,919,600. The eventual balance was commuted or discharged in 1854. The Bank added ‘we fear that the Statute of Limitations may run against Hichens if it were thinking of presenting the certificate for payment, but retaining the certificate may stand as a warning against the perils of inflationary finance’. The equivalent of £106.10 today is £4,486.97. Consolidated £3 per cent. Annuities (1751). This document dated 22nd July 1803 and bearing the signature of Robert Hichens, broker, is the oldest record in our archives. 28 Hichens, Harrison & Co. plc Registered in England No. 2368530 Registered Office - Bell Court House, 11 Blomfield Street, London, EC2M 1LB Telephone – 020 7588 5171 Fax – 020 7628 9481 Regulated by the Financial Services Authority Limited Member firm of the London Stock Exchange