Daily Archives: 11 November, 2010

1761: John Perrott, bankrupt debtor

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On this date in 1761, John Perrott was hanged at Smithfield for fraudulent bankruptcy.

Perrott was one of the bare handful of British subjects executed during the last century that bankruptcy legislation officially came with hemp teeth; he’s sometimes noted as the last bankrupt put to death, although in reality, he was simply the most famous of the last few.


John Perrott hanged at Smithfield (detail view; click for full image). From here.

He got famous in the usual way.

A once-reputable merchant who blew his fortune in the late 1750s? That backstory does not get you into the Newgate Calendar.

Fortune blown by siphoning creditors’ money to shady mistress, then refusing to divulge the particulars? Now you’re talking. It’s a wonderful vignette in the annals of moralism to find Perrott on the eve of his execution keeping mum on the subject because he had already received his last Sacrament — the inference being that in speaking, he would only sully his soul with a lie.

It was an aggravating position for his creditors, who had reason to believe that there remained recoverable cash, in the hands of his “Mrs. Ferne” or elsewhere.

Creditors always get stuck in a bind when debt goes bad.

The death penalty for bankruptcy has a long and illustrious history, back to the Roman Twelve Tables with its Shylock-like right for the aggrieved lenders to cut the debtor apart into parts proportional to their lost investments, de debitore in partes secando.*

Still, that stern corporal stricture has tended to run up against the simple fact that creditors are financially interested parties whose benefit is almost always better served by keeping their debtor among the living where he might be capable of repairing some part of his bond. Slavery, therefore, was often preferred by the ancients and retains a symbiotic relationship to debt to this day: to force the service of a debt, make a man your slave; likewise, to force someone into slavery, make him your debtor. Human traffickers love this tactic.

At any rate, English bankruptcy law as it evolved was a strange hybrid of public (criminal prosecutions) and private (creditors initiated and paid for the prosecutions). Bluffing a charge at the Old Bailey was just one potential strategem in the contentious relationship between borrower and lender, and not the most effective one, as this Duke law journal article (pdf) by Emily Kadens notes:

“[I]f this Bill Pass,” [critics of a 1706 bankruptcy measure] warned, “it will never be executed.” The latter prognostication turned out to be virtually correct. Creditors prosecuted infrequently because of the severity of the punishment and the cost and difficulty involved. Even when creditors did bring lawsuits, juries may have been reluctant to convict not only because of the penalty but also because they understood the potential for fraud in the bankruptcy system itself … A man was made a bankrupt by the ex parte declaration of a person claiming to be a creditor … The alleged bankrupt had no right to object … In the meantime, his alleged creditors had taken possession of his assets, leaving him nothing with which he could fight his case, unless he committed a felony by concealing his assets or had friends or family support him.

That fraud aspect was essential to making it, as Perrott did, so far as the gallows; plain-vanilla bankruptcy was not in itself a capital offense, but a debtor hiding his assets in the process changed matters. The law distinguished the accidental bankruptcy (e.g., the ship with your imports sunk) from the larcenous: “To the misfortunes … of debtors, the law has given a compassionate remedy,” Blackstone notes. “But denied it to their faults.” Which is not to say that many, many debtors did not indulge these “faults.”

It was nearly two full years from the time Perrott sat his lenders down in a tavern in — naturally — Cheapside to give them the bad news that he was a little bit short, until the time he met the hangman. In that span, auditors picking through the wreck of his estate gradually became aware that the numbers didn’t add up, and his bum business practices (selling 20% below cost to obtain ready cash) still left up to 17,000 missing pounds unexplained.

By the by, the emergence into the investigation of a paramour, who then turned out to be hiding Perrott-issued banknotes, transformed an ordinary bankruptcy into one of those felonious asset-concealment situations. (And, into fine tabloid fodder for the broadsheets.) When Perrott wouldn’t come clean with the whereabouts of his purloined boodle, his creditors had him up on hanging charges. And when Perrott still wouldn’t come clean — Sacrament and all — he stiffed his lenders at the last by leaving them no way to recover their swag.

Hopefully, Mrs. Ferne was worth the trouble.

* More discussion of the Roman jurisprudence here.

On this day..