Forestallers, Regrators and Others
Bill Long 2/2/06
An Unlikely Cast of Middlemen
This and the next few essays are a detour from the road I have been traversing which describe the evolution of terms for salesmen over the past several centuries. Essays on that are here and here and here. My concern in these essays will be to introduce you to the world of forestallers, regrators, engrossers, interpolators, kidders and others--a series of "middlemen" whose work was alternately applauded and condemned in the early modern world. In order to set the context for examining the words, however, I need to establish briefly the economic or trade context of medieval England.
Grants and Restrictions by the King/Parliament
In early common law England (before the 16th century), legal right to control markets in England rested with the crown. English kings, however, began to grant rights to conduct markets or fairs to local authorities, such as a Bishop.* Along with the rights to
[*A helpful and brief overview of this process is in Leo J. Raskind, "The Misappropriation Doctrine as a Competitive Norm of Intellectual Property Law," 75 MinnLRev 875, 890-91 (1991).]
conduct a fair would be the jurisdiction to establish a court of law. Subject matter jurisdiction (as we say in law) was limited to cases in debt and contract breach. As time went on, however, the crown wanted to exercise even more control over trade. It is in this context that we will meet, in the next essay, forestallers, regrators and engrossers. Suffice it to say for our purposes now that by a 1552 statute ("Act against Regrators, Forestallers and Engrossers, 5 & 6 Edw. VI, ch. 14 (1552)), limitations were placed not only on the conduct of sellers at fairs but of those middlemen who would acquire goods from the farms and attempt to jack up the prices to sell at fairs or elsewhere.
Enter Adam Smith
An interesting source not only for understanding this 1552 statute but also for why the statute was ridiculously outmoded in the 18th century is Adam Smith's discussion of it in his 1776 Inquiry into the Wealth of Nations (IV.5.49ff.). In describing the statute's origin, Smith says:
"By the 5th and 6th of Edward VI. cap. 14, it was enacted, That whoever should buy any corn or grain with intent to sell it again, should be reputed an unlawful engrosser, and should, for the first fault, suffer two months imprisonment, and forfeit the value of the corn; for the second, suffer six months imprisonment, and forfeit double the value; and for the third, be set in the pillory, suffer imprisonment during the king's pleasure, and forfeit all his goods and chattels. The ancient policy of most other parts of Europe was no better than that of England," IV.5.49.
Smith goes on to explain the problem that 16th century England had with this type of middleman.
"Our ancestors seem to have imagined that the people would buy their corn cheaper of the farmer than of the corn merchant, who, they were afraid, would require, over and above the price which he paid to the farmer, an exorbitant profit to himself. They endeavoured, therefore, to annihilate his trade altogether. They even endeavoured to hinder as much as possible any middle man of any kind from coming in between the grower and the consumer; and this was the meaning of the many restraints which they imposed upon the trade of those whom they called kidders or carriers of corn, a trade which nobody was allowed to exercise without a licence ascertaining his qualifications as a man of probity and fair dealing," IV.5.50.
Smith then summarizes the effect of this statute.
"The statute of Edward VI., therefore, by prohibiting as much as possible any middle man from coming between the grower and the consumer, endeavoured to annihilate a trade, of which the free exercise is not only the best palliative of the inconveniences of a dearth but the best preventative of that calamity: after the trade of the farmer, no trade contributing so much to the growing of corn as that of the corn merchant," IV.5.60.
But then, he notes how the rigor of the law was relaxed over time:
"The rigour of this law was afterwards softened by several subsequent statutes, which successively permitted the engrossing of corn when the price of wheat should not exceed twenty, twenty-four, thirty-two, and forty shillings the quarter. At last, by the 15th of Charles II. c. 7, the engrossing or buying of corn in order to sell it again, as long as the price of wheat did not exceed forty-eight shillings the quarter, and that of other grain in proportion, was declared lawful to all persons not being forestallers, that is, not selling again in the same market within three months. All the freedom which the trade of the inland corn dealer has ever yet enjoyed was bestowed upon it by this statute. The statute of the twelfth of the present king, which repeals almost all the other ancient laws against engrossers and forestallers, does not repeal the restrictions of this particular statute, which therefore still continue in force," IV.5.61.
For more than two centuries, then, the heavy hand of the government rested upon those men in the middle who would take goods from farm to market. But by the a 1772 statute, in the days of good old George III, most of the restrictions were done away with. The official name of that statute is "An act for Repealing Several Laws Therein Mentioned Against Badgers, Engrossers, Forestallers and Regrators," 12 George III, ch. 71 (1772).
And, I cannot end this essay without Smith's summary evaluation of the statutes which would limit regrators, etc.: "The popular fear of engrossing and forestalling may be compared to the popular terrors and suspicions of witchcraft," IV.5.65. And here was Adam Smith, the dispeller of economic witchcraft, who would give us the beneficent invisible hand in its place.
But we must turn now to a more detailed study of some of the terms used to describe individuals who engaged in this trade.
1701
Copyright © 2004-2007 William R. Long |