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55t f rioTWR-nss ) HOUSE OF REPRESENTATIVES. (D oc.U o. 207,
)
Part 2.




BULLETIN
OF THE

NO. 21-MAKCH, 1899.
ISSUED EVERY OTHER MONTH.

EDITED BY
CARROLL D. WRIGHT,
COMMISSIONER.

OREN W. WEAVER,
CHIEF CLERK.

W ASHIU GTOH:
GOVERNMENT PRINTING OFFICE,

1 899.




OOISTTEISTTS.
Page.

Pawnbroking in Europe and the United States, by W . R. Patterson, Ph. D.,
Digest of recent reports of State bureaus of labor statistics:
Michigan.........................................................................................................................
Second annual report on the building and loan associations of Connecticut.
Eighth annual report on the building and loan associations of New Y o rk ...
First annual report on the building and loan associations of Wisconsin........
Digest of recent foreign statistical publications.................. ..................................
I) ecisions of courts affecting la b o r ......................................................
Recent Government contracts........................................................................................




in

311-314
315, 316
317, 318
319
320-327
328-359
360




BULLETIN
OF T H E

D E P A R T M E N T OF L A B O R .
No. 21.

WASHINGTON.

M

arch

,

1899.

PAWNBROKING IN EUROPE AND THE UNITED STATES, (a)
B Y W . R. PATTERSON, PH. D.

INTRODUCTION.
Tlie original pawn shop is difficult to locate. Early historians were
interested in other lines, and only when the royal crown was placed in
pawn or the King took steps to curb the cupidity of the hated money
lender was the subject of pawns and pledges mentioned. Moreover,
the history of pawnbroking is so interwoven with that of usury and
banking that its complete separation from these subjects is, for a time
at least, an impossibility. From earliest times and with all peoples
the system of pledging effects as security for advances in money has
existed in some form. In this early period all those who accepted
pledges as security for loans were not pawnbrokers in the sense that
we to-day use the term.
Of the antiquity of pawnbroking we are assured, but are without a
clue as to what may have been its process of metamorphosis from the
time of the Jewish law to that of the Roman. Its analogy to banking,
the fact that the pawnbrokers later became bankers, would lead to the
conclusion that private pawnbrokers existed long before the State took
cognizance of the business. It seems probable that the constant tak­
ing of articles in pledge, which of necessity demanded their safekeeping
to secure the repayment of the loan, suggested the like deposit of
money and valuables. In this case the progenitor of the present bank­
ing system was originally a pawnshop, instead of a bank which later
took up the pawn business.
a The historical portion of this study, now greatly abridged, was originally sub­
mitted to the University of Pennsylvania as a doctorate dissertation. The author
wishes to take this opportunity to express his gratitude for the uniform courtesy
shown him by the city officials and those in charge o f the pawnbroking institutions
and chattel-mortgage companies whom he had occasion to visit in the course of the
preparation of this article.




173

174

BULLETIN OF THE DEPARTMENT OF LABOR.

BELGIUM.
In 1534 a Flemish priest gave a small sura to establish a pawn bank
at Ypres, and in 1572 a similar bank was founded at Bruges. In like
manner, September 23, 1607, Martholomew Masurel, a citizen of Lille,
announced his intention of willing his property to the city for the
founding of a mont de-piete, (a) which should, as in the above instances,
make advances without interest. But two years later, being desirous
of seeing such an effort made during his life, he agreed to endow the
undertaking upon condition that the city furnish a suitable building
for the purpose. This was readily agreed to, and in 1610 the first loans
were made. Meanwhile the decrees given by Albert and Isabella for
the control of the business were proving ineffectual, and in 1615 they
requested Winchelaus Oobergher to formulate a plan for the introduc­
tion of the mont-de-piete into the provinces under their rule. His
report was submitted three years later, and after a council of theolo­
gians had approved the idea of charging interest he was appointed
superintendent-general and authorized to establish monts-de-piete in
the several cities of Belgium.
The plan was at once put in operation. With capital supplied by
the generosity of its citizens and their sovereign, supplemented by
funds gained from the sale of bonds bearing 6J per cent interest, the
experimental institution was founded at Brussels. Early in 1620 opera­
tions were begun at Antwerp and later in the year at Mechlin. But
before proceeding further Oobergher introduced a new feature which
in the end led to serious difficulties. This was to make the several
institutions interdependent, so that the more prosperous would con­
tribute to the success of their less fortunate neighbors. The work pro­
ceeded rapidly, and by 1633 some fifteen cities were supplied with
monts-de-piete. But this apparent success led Oobergher to overesti­
mate his ability. Without seeking the advice of his superiors he
a Some doubt has arisen as to the early significance of the term “ montes pietatis,”
or “ mont-de-pi6t6,” as written at present. Gilbart suggests that the word “ mont”
or “ mount” was, at an early period, applied to any pecuniary fund, and thinks that
the promoters of the scheme added “ pietatis” to give it an air of religion. M. Blaize
points out that the word “ mont” was employed in the fifteenth century to designate
public offices where funds were placed at interest, the “ monti” at that time doing
a loan business. Others maintain that the word means hill, stating in support of
the idea that the bank was situated on a slight elevation, called the “ hill of piety,”
which name attached itself to the institution. The former is perhaps the true mean­
ing of the word “ mont,” and while “ pieta” is not exactly synonymous with the
word “ piety,” it refers to the religious sentiment of its founders and carries with it
the idea of aid to the necessitous classes. Yet it is difficult to express the entire
title, “ mont-de-pffit6,” in our language. To translate it “ mountain of piety” or
“ mountain of charity” conveys little or no idea of the character of the institution,
while to render it “ bank of charity,” as some suggest, is open to the same objec­
tion. It seems best not to attempt a translation, but employ it as a new word in our
vocabulary-




PAWNBROKING IN EUROPE AND THE UNITED STATES.

175

incurred a heavy indebtedness and at the same time lowered the rate
of interest charged on advances. Yet his efforts might have been suc­
cessful had not the war with France led to heavy losses on the sale of
unredeemed pledges and Isabella drawn upon its funds for the support
of the war, but with these conditions present it was necessary to sus­
pend operations in 1649.
The effect of the failure was apparent in the immediate rise of the
rate of interest, leading to a general demand for the reorganization of
the monts-de-piet6, which when effected was destined to be crippled by
the interdependent feature. As a result of the wars, cessions of land
were made to France which included several of the principal cities; but
their new possessor, when asked to share their burden of the debt, posi­
tively refused, thereby leaving the entire debt to be met by the remain­
ing cities. They were unable to do this, or even to meet the interest,
until the house of Austria took control, in 1752. Under its direction a
compromise was effected with the creditors and the administration of
the monts-de-piete placed under the immediate control of the Govern­
ment. But, although the change was beneficial, Joseph II saw fit to
again alter it. The plan adopted was, however, denied a practical test,
as the revolution of 1789 led to another suspension ; and, although again
reorganized, the revolutionary legislation of 1793 made further efforts
impracticable, and the doors were again closed in 1795. Coming now
under the rule of Napoleon, who was an ardent advocate of the montde-piete, steps were taken for a reorganization in accordance with
the laws of France, and prior to 1814 ten of the principal cities were
again supplied. William carried on the work begun by Napoleon, and
by 1830 had added twelve monts-de-pi6te to the list. But his principal
service was the enactment of the law of 1826, whose provisions govern
the business in Holland to-day. In Belgium, however, after its separa­
tion from Holland, the strict control of the central authorities was
deemed obnoxious, and the law of 1836, which gave the cities full con­
trol, was allowed to supplant it. The result was disastrous. The
cities abused their privilege, and at once sought to make the mont-depiete a source of revenue. In short, the charitable nature of the insti­
tution was soon so far forgotten that the Government appointed a
committee u to investigate and suggest a method of reorganization,”
and one year later the committee made a report to which the present
law, enacted in 1848, owes its most efficient provisions.
A t first, with the central and local power practically nil, a strong
superintendent, ignoring his advisers, led to failure. As a remedy, the
number of advisers was increased and the superintendent deprived of
his initiative. But the action was sluggish, and the lack of immediate
responsibility on the part of the members of the committee led to
extremes that made reorganization again necessary. Direct control
by the Government was substituted, but political events hindered its
operation, and change followed change until the law of 1826. In this



176

BULLETIN OF THE DEPARTMENT OF LABOR.

the local authorities were recognized, but their work was closely super­
vised by the provincial and central governments. On the whole, the
plan was a success, but lacked flexibility 5 while its substitute, by remov­
ing all central control, was entirely too flexible.
THE PR ESEN T L A W .

Under the law of 1848 the managing board consists of five persons
nominated by the communal council, one of whom is a member of the
board of charities (Bureau de Bienfaisance), and one a member of the
asylums board (Administration des Hospices). The law provides that
the decision of the communal council with regard to the following points
must be submitted to the permanent delegation of the provincial coun­
cil and to the King: Amount and rate of interest upon loans to be
contracted by the mont-de-piete, the rate of interest to be charged to
borrowers, the conditions to be observed for gratuitous loans, the
expenses of administration, the organization of the staff, the amount
of their salaries and security, the number and organization of the aux­
iliary offices, the period within which unredeemed pledges may be sold
and the conditions of sale. A copy of the budgets and accounts, after
the approval of the communal council, is sent to the permanent delega­
tion, who are to transmit it, with their observations, to the central
government; and, lastly, the central authorities may cause the inspec­
tion of any institution whenever they shall deem it necessary.
The regulations as to funds were made more effective. Heretofore
considerable confusion existed as to the law on this point. For exam­
ple, in Brussels the mont-de-piete had been compelled to receive all
the surplus funds of the charitable institutions, so that it was often
paying interest on three and a half times more money than it was using
in the business. To make the point clear, the law provided that, “ in
the absence of any endowments, gifts, or bequests, the public board of
charities shall continue to provide, within the limit of their resources
and upon the most favorable conditions, the necessary funds for the
work of the mont-de-piet£.?? In case of any dispute the communal
council decides, subject to the approval of the permanent delega­
tion of the provincial council, the respective amount of the contribu­
tion to be supplied by each institution. But, should these amounts
prove inadequate, the communal council is authorized to make up the
deficiency. If, however, its means do not allow of such a course, and if
no subsidy is granted, either by the province or State, then the montde-pi6te is to be abolished.
Another wise provision, and one in which the Belgian law is in
advance of that of other countries, is to the effect that profits arising
after paying the expenses of management and interest upon sums
borrowed, as also the unclaimed surplus, shall be first applied to the
payment of borrowed funds, after which it shall be used to form an
endowment necessary to provide for the operations of the institution.
When this endowment is sufficiently large to meet all loans and cover



PAWNBROKING IN EUROPE AND THE UNITED STATES.

177

expenses, “ the yearly profits shall be devoted to making loans, inter­
est free, to indigent persons, and to the formation of an endowment for
that purpose.” When this second endowment reaches the amount
fixed by the constitution (Reglement Organique), the yearly profits are
to be paid to the charitable institutions of the city.
Interest upon advances is reckoned day by day until the date of
repayment, but no loan, whatever the value of the pledge or the length
of the deposit, maybe settled for less than 5 centimes (1 cent). To
render the redemption as easy as possible, pawners are permitted to
pay their advance by installments and to redeem in succession the
several articles forming a single pledge.
It was noted that the law of 1826 requiring the gratuitous refunding
of stolen or lost articles placed in pawn caused general dissatisfaction.
The present law, however, effects a most successful compromise. It
provides that such an article may be gratuitously redeemed any time
within a period of six months from the date of pawning, if the same has
been accepted after the director of the institution has been informed
as to the loss of the article, either by the police or the owner, and a
description of the same furnished him. If, however, the article has not
been claimed within that period, or a description of it been supplied
prior to its acceptance, the owner to obtain the same must pay the
amount advanced thereon, together with interest due.
The question as to whether new goods and merchandise should be
taken in pawn elicited a great amount of discussion. Those in favor
of the idea pled a desire to assist the small merchant, who, pressed to
meet a payment, could pawn a portion of his goods and so save the
entire stock. Their opponents claimed this would only open an avenue
whereby an expectant bankrupt could defraud his creditors. The com­
mittee, being unable to decide the point, submitted it to the decision of
44 eminent jurists, who by a vote of 31 to 13 decided in favor of the
acceptance of new merchandise in pawn. The law therefore provides
that loans upon new goods, deposited by the same owner, shall not
exceed 1,000 francs ($193). But no loan shall be made save in the
presence of the director or his deputy, and unless the pawner furnish
proof of his identity.
C O N S T IT U T IO N OF T H E M O N T -D E -F IE T E O F B R U S S E L S .

The constitution (Reglement Organique) for the mont de-piete of
Brussels was ratified May 25,1891. By its provisions the managing
board is authorized to nominate, suspend, and dismiss any of the
employees of the institution except the director or the registrar, who
are nominated by the common council upon presentation by the man­
aging board of a list of three candidates for each position. Each
official, before assuming his duties, is required to furnish security (cautionment) in the form of real property, public funds of the State or
guaranteed by the State, bonds of the province of Brabant, bonds of
the city of Brussels, or cash. The interest to be paid on funds so



178

BULLETIN OF THE DEPARTMENT OF LABOR.

deposited is fixed by the board, but in case of cash not over 4 per
cent is allowable. For the director this security is fixed at 40,000
francs ($7,720), while the registrar is required to furnish 20,000 francs
($3,860), the board determining the amount for the remaining officers,
save the receiver and paying clerk, whose deposit is 10,000 francs
($1,930) each.
With the exception of the following articles all personal property
(effets mobiliers) is subject to pledge: Tools of workmen; weapons and
articles of equipment of noncommissioned officers and privates of the
army, the civic guard, the corps of firemen, and agents of the police;
decorations and badges conferred by the Belgian Government; articles
derived from relief granted by public institutions of charity; articles
and ornaments which are or have been in use for the performance of a
form of public worship; titles, deeds, bonds, and public or commercial
securities. In addition to these, Antwerp refuses to receive eatables,
liquids, drugs, or any merchandise subject to prompt deterioration or
decay; all articles, pictures, engravings, drawings, or other objects of
art which by their nature, weight, or dimensions are not suitable to be
placed in its storerooms, and, in time ' of contagious diseases, any
article not properly disinfected. In both cities articles whose esti­
mated value falls short of 2 francs ($0,386) are also refused, while in
Brussels the board of management may refuse to lend more than 1,500
francs ($289.50) on a single pledge, and only under exceptional circum­
stances will the sum of 3,000 francs ($579) be advanced.
On articles of gold and silver or jewels four-fifths of their intrin­
sic value may be advanced; on all other articles, two-thirds of the
estimated value. The borrowers may, however, pledge goods fora less
sum than this, save when the estimated value is 500 francs ($96.50) or
over, when at least one-half of the value must be advanced. The
appraisal is made by persons responsible to the institution for any loss
arising from the sale of articles appraised by them, providing that the
loss exceeds in any year 600 francs ($115.80) for each appraiser in the
central office and 300 francs ($57.90) for each appraiser employed in
the branch offices. All loans are made for 12 months and are subject
to renewal at any time upon payment of interest due, but no renewal
may be made without a reappraisal of the pledge. Articles not re­
deemed or renewed at the expiration of the loan period are sold a month
later, and any surplus resulting from such sale is kept for two years at
the disposal of the rightful owner. In all cases the expense of sale,
5 per cent of the purchase price, is borne by the purchaser.
While the institution is not responsible for loss resulting from cir­
cumstances beyond its control, such as fire, riots, and plundering, yet
in case any article is lost or mislaid its value is paid to the owner; such
value to be the amount advanced plus 25 per cent of the same in case
of gold or silver articles and jewels and 50 per cent in the case of
other goods, or else the amount of the intrinsic value or the estimate of
the appraiser.



PAWNBROKING IN EUROPE AND THE UNITED STATES.

179

Whenever articles suspected of being lost or stolen are offered in
pledge the loan may be deferred for 24 hours and the articles detained
by the mont-de-pffite. In such cases the police are notified, and if after
due investigation no evidence is produced against the legitimacy of the
pledge the advance is made or pledge returned. If, however, articles
accepted in pawn prove to be lost or stolen goods, the owner may only
secure his property by paying the institution the amount advanced on
the same, together with accrued interest.
R E S U L T S O B T A IN E D A N D B U S I N E S S D O N E B Y
P IE T E O F B E L G IU M .

T H E M O N T S -D E -

The provision of the law which directs that the profits and unclaimed
surplus of the business shall be applied to the repayment of borrowed
funds, and after that go to form a permanent capital for the institution,
has placed the monts-de-piete of Belgium on a firm financial footing.
Already several of them have an accumulated capital almost sufficient
to meet their needs, many paying a very small interest on borrowed
funds, while in others a larger amount of capital must be obtained
by borrowing. Yet in 1895 the 17 institutions of the country paid
only 151,523 francs ($29,243.94) interest on borrowed funds ; and since
these funds were obtained at the very reasonable rates of from 3 to 5
per cent per annum the sum total borrowed must have been about
3,800,000 francs ($733,400), or, roughly, one-third of the total amount
loaned on articles pledged and renewed. The showing for Brussels is
not so favorable. In the same year the city paid out 98,066 francs
($18,926.74) in interest for borrowed funds, and that at a rate varying from
3 to 4 per cent per annum, which indicates that more than 50 per cent
of the amount loaned on articles pledged and renewed must have been
borrowed. Antwerp found it necessary to pay 5 per cent on its borrowed
capital, yet its total expense for interest was only 6,347 francs ($1,224.97),
showing that in making a loan of 2,124,954 francs ($410,116.12) it was
necessary to borrow only about 126,940 francs ($24,499).
The following table shows the number of articles pledged and renewed,
redeemed, and sold at the monts-de-piete of Belgium, together with the
total and average loans on such articles for the years 1889 to 1895:
A R T IC L E S P L E D G E D A K D R E N E W E D , R E D E E M E D , A N D SOLD A T T H E M ONTS-DEPIISTfi OE B E LG IU M , A N D T O T A L A N D A V E R A G E L O A N S ON SUCH A R T IC L E S , 1889
TO 1895.
Pledged and renewed.
Year.
A rticles.

993, 308
1889...........................
966, 882
1890............................
1891........................... 1, 010, 897
956, 480
1892............................
1893............................
880, 014
874, 696
1894............................
891, 756
1895............................




A m ount
loaned.

Redeemed.

A v e r­
age Articles.
loan.

$2, 321, 008 $2.34
2, 234, 522 2. 31
2, 257, 731 2. 23
2,161,078 2.26
2, 046, 268 2. 33
2, 041,471 2. 33
2,135,378 2.39

942, 079
924, 089
933, 672
932, 740
858, 675
837,688
845, 617

A m ount
loaned.

Sold.
A v e r­
A r t i­
age
cles.
loan.

$2, 295,429 $2.44
2,180, 251 2. 36
2,162, 059 2.32
2,176,194 2. 33
2, 074,118 2.42
2, 034, 898 2.43
2,061, 824 2. 44

A m ount
loaned.

A v e r­
age
loan.

46, 815 $105, 413
45, 781 101, 062
96, 758
45, 352
97, 459
48,176
44, 636
98, 829
38,991
90, 510
37, 795 100, 256

$2. 25
2. 21
2.13
2.02
2.21
2. 32
2. 65

180

BULLETIN OF THE DEPARTMENT OF LABOR.

Available reports do not make a distinction between the articles
pledged for the first time and those renewed, so that a study as to the
frequency of renewals is precluded. The total number of pledges
received has declined from 993,308 in 1889 to 891,756 in 1895. The
smallest number of pledges received in 1895 by any institution was
4,979 at Gourtrai, and the highest 326,644, or 37 per cent of the total for
the country, at Brussels. The average loan was 12.11 francs ($2.34)
in 1889 and 12.40 francs ($2.39) in 1895, the lowest point, 11.57 francs
($2.23), having been reached in 1891, when a marked increase in the
number of pledges occurred. The average at Brussels, however, was
somewhat higher, being 16.49 francs ($3.18) in 1895, while that at Alost
was much smaller, being only 3.37 francs ($0.65).
The number of articles redeemed has also fallen since 1889, but the
average loan, contrary to the usual experience, has not only approxi­
mated very closely to the average on articles pledged and renewed, but
has even exhibited a slight tendency to exceed it. In 1895, if we take
the number pledged and renewed as a basis, we find that 94.83 per cent
of the articles received were redeemed, leaving but 5.17 per cent to be
sold at auction. Such per cents are, of course, only approximate, as the
pledges redeemed were not all received in 1895, but the error arising
from such a process is slight. The following table shows the number
of articles pledged and renewed, classified according to the amount
loaned on each, together with the number of loans on new merchandise:
A R T IC L E S P L E D G E D A N D R E N E W E D A T T H E M O N T S -D E -P I^ T ^ OF B E L G IU M , B Y
S IZ E OF LOAN S, 1889 TO 1895.
A rticles pledged and renewed.
Size o f loan.
1889.

1890.

1891.

1892.

1893.

1894.

1895.

Under 5 francs ($0.965)...................... 488,763
5 to 10 francs ($0,965 to $1.93)........... 246, 300
10 to 50 francs ($1.93 to $9.65)........... 203, 968
50 to 100 francs ($9.65 to $19.30)........ 32, 589
100 to 500 francs ($19.30 to $96.50)...
14, 303
709
500 francs ($96.50) or o v e r .................

472,840
245, 572
196, 975
30,970
13, 799
699

503,066
257,116
198,193
30, 660
13, 266
712

483,558
235, 323
186,195
29, 856
13, 287
749

440,277
214,611
175, 597
28,875
12,806
716

436.148
215.148
174, 228
28, 500
12, 706
765

436, 714
222, 550
180, 828
29, 792
13,180
901

T o ta l............................................
N ew m erch an dise.................... ..........

986, 632
6, 676

960, 855
6,027

1, 003, 013
7, 884

948, 968
7, 512

872, 882
7,132

867,495
7, 201

883, 965
7, 791

Grand tota l.................................

093, 308

966,882

1,010,1397. 956,480

880,014

874, 696

891, 756

Of 891,756 articles pledged and renewed in 1895, 436,714 or 49 per
cent of the total received obtained an advance of less than 5 francs
($0,965), 222,550 or 24.9 per cent of the total were for sums of from 5 to
10 francs ($0,965 to $1.93), 224,701 or 25.2 per cent were for sums above
that amount, while the remaining 7,791 or 0.9 per cent comprised new
merchandise not classified. In Brussels the number of articles on
which an advance of less than 5 francs ($0,965) was made constituted
41.8 per cent of the total, those for advances of from 5 to 10 francs
($0,965 to $1.93) 26 per cent, leaving 31.7 per cent for loans of greater
amounts and 0.5 per cent for new merchandise not classified.



PAWNBROKING IN EUROPE AND THE UNITED STATES.

181

The amount loaned on articles sold, the expenses and interest on the
same, the amount received from sales, and the surplus are shown in the
following table for the years 1889 to 1895 :
L O A N S ON A R T IC L E S SOLD, R E C E IP T S E RO M SALES, A N D SURPLU S OF M ONTS-DEP I ^ T ^ OF B E L G IU M , 1889 TO 1895.

A m ou nt loaned on articles
s o ld ..........................................
Interest and expen ses.............
T ota l.................................
A m ount received from s a les..
Provisional s u rp lu s .................
A m ount o f surplus reclaim ed.
Unclaimed surplus...................

1889.

1890.

1891.

1892.

1893.

1894.

$105, 413
10,681

$101,062
10, 275

$96, 758
11, 581

$97,459
11, 232

$98, 829
11, 064

$90, 510
8,559

$100, 256
9,276

116,094
111, 337
139,024
141,745
28, 660
30, 319
22,942
20, 689
6, 487 1
6,543
1

108, 339
.133,451
29, 688
22, 887
6, 609

108, 691
130, 239
27, 502
20, 578
6, 913

109, 893
133, 057
28,265
20, 401
6,601

99, 069
122, 707
26, 347
19, 979
5, 749

109,532
134, 433
27,131
19, 544
6,419

1895.

In general about 5 per cent of all pawns received come to auction.
With the exception of 1895, the average loan from 1889 to 1895 on these
articles was below that on articles pledged and renewed or redeemed.
This is peculiar to Belgium, as in other countries it will be found that the
average loan is higher on articles sold than on those redeemed or pledged,
showing the difficulty experienced in redeeming articles of considerable
value. In 1895 the 37,795 articles sold represented a loan of 519,403
francs ($100,256.36), which, together with interest and charges, amounted
to 567,525 francs ($109,532.33). The amount realized at the sale was
696,543 francs ($134,432.80). The provisional surplus was 140,577 francs
($27,131.36). The amount of surplus unclaimed under the two-year
limit was 33,257 francs ($6,418.60), which was forfeited to the institu­
tion. In the same year Brussels sold 12,530 articles on which a loan of
160,902 francs ($31,054.09) had been made, which was increased by
interest and expenses to 172,542 francs ($33,300.61). The amount
realized from the sale was 239,220 francs ($46,169.46), the provisional
surplus was 68,244 francs ($13,171.09), and the amount of surplus
claimed by the owners inside of the two-year period was 52,941 francs
($10,217.61).
The rate of interest charged on loans varies from 4 to 16 per cent
per annum. This minimum rate of 4 per cent*in Ghent is increased by
a fixed fee of 2 per cent at the time the pawn is received and 1 per
cent at the time it is redeemed, but the amount of either of these fees
may not exceed 1 franc ($0,193). In like manner the rate in Liege is 5
per cent, but there is also a fixed fee of 1 per cent on pledging and a
commission of J per cent per month. Bruges has a rate varying from
8 to 12 per cent per annum, but all loans of 5 francs ($0,965) or less are
interest free. Oourtrai charges from 12 to 15 per cent per annum in
proportion to the amount advanced; Huy makes a like gradation vary*
ing from 7 to 15 per cent, and Namur from 10 to 16 per cent per annum.
The lowest rate without charges is that of Brussels— 6 per cent per
annum; but the rate in Antwerp very closely approaches it. Prior to




182

BULLETIN OF THE DEPARTMENT OF LABOR.

1897 Antwerp had charged 8 per cent per annum, but in March of that
year it was decided to lower this to 4 per cent for clothing and bedding
and 7J per cent on all other pledges.
The net profit of the monts-de-piete of Belgium in 1889 was 109,870
francs ($21,204.91). In 1890 it rose to 112,834 francs ($21,776.96), and
in 1895 it had fallen to 64,652 francs ($12,477.84). The net profit in
Brussels in 1895 was 19,651 francs ($3,792.64), and in Antwerp 13,617
francs ($2,628.08).
HOLLAND.
In 1614 the principal pawnshop ( Groote Banck van Leening) of
Amsterdam was established, and Ferdinand of Bavaria, influenced by
the feasibility of the scheme and CobergheFs success in neighboring
provinces, invited him to introduce a similar system into the principal­
ity of Liege. But because of his work in Belgium, Oobergher was
unable to accept the invitation, and Ferdinand assigned the task to
Simon Mouillet, who adopted a plan superior to that of CobergheFs,
in that the interdependent feature was a sort of mutual insurance
which extended only to losses incurred by fire and pillage. From this
point, however, the history of Holland is so closely allied with that of
Belgium that a further discussion of the development of the business
is unnecessary.
DECREE

R E G U L A T IN G -

THE P A W N B R O K IN G
HOLLAND.

B U S IN E S S

IN

The preamble of the decree of 1826, which still finds application,
recites that under the present condition of society it is necessary to
have some public institution authorized to loan upon pawns, thereby
affording a source of relief in times of pressing need and protecting the
borrower against usury. It further points out that such institutions
should be organized as advantageously for the borrowers as the nature
of the business will permit, and with this as its avowed purpose the law
of 1826 was framed. By its provisions the formation of new pawn
banks (banken van leening), or any change in the form of those already
authorized, as well as .the approval of the rules governing them, is
made subject to the royal sanction. All such banks are declared to be
charitable institutions, and as such are placed in the hands of the
municipal authorities. Their administration is by the president of the
local government, or a member of the same appointed by him, who,
together with certain others named by the local administration, form a
committee of administration which exercises control under the sur­
veillance o f the provincial government and the Government itself. In
cities, however, where the care of the poor is given over to certain offi­
cials, the members of the above committee are appointed upon the
nomination of that body. In general the local government is author­




PAWNBROKING IN EUROPE AND THE UNITED STATES.

183

ized to see that the business is conducted with the greatest economy
and only such officers employed as are absolutely required for the serv­
ice. The director, if that official is considered necessary, is appointed
by the local government upon the nomination of the committee of
administration. All other officers are named by the committee upon
the recommendation of the director. Each officer is required to take
an oath to faithfully perform his duties and keep secret all business of
the institution except in cases where they are called upon to act as
witnesses.
The capital necessary for the founding of a bank, as well as that used
in its business, is made up of funds belonging to the bank and those
bequeathed to it; the bonds (borgtochten) of its officers and agents and
those of such employees of the city and public institutions as the local
administration may direct; the funds of the city or commune in which
the institution is located, or of charitable institutions having a share in
its profits; unused funds of other institutions which the administration
is authorized to employ, and, if necessary, funds obtained by loan. The
interest paid on money so obtained may not exceed 5 per cent per
annum, but public institutions advancing funds have the option of
accepting the regular rate of interest or sharing the profits of the
business.
The rate of interest to be paid on advances is fixed by special rules
adopted with others for the regulation of the institution at the time of
its founding, which rate may be lowered as circumstances permit. A
peculiarity of the law, however, is that the interest may vary with the
amount loaned, but not with regard to the character of the pawns.
Charges for the pawn ticket, for special services, or for any reason
whatever are prohibited; but if the interest due is less than the small­
est coin in the currency, the coin is paid in full, and in the reckoning of
interest all fractions are counted in favor of the institution. According
to the decree real estate is not subject to pawn, nor are bonds, stocks,
public or commercial effects, objects and ornaments belonging to the
church, military goods, weapons, artisans7tools or instruments necessary
to carry on any trade, or any article whose value is not sufficient to
secure a loan of 0.5 florin ($0,201). And it is further provided that in
times of contagious diseases clothing and other articles which may
carry contagion may be refused until they have been properly fumigated
and purified.
Each bank is obliged to keep a register, supplied by the local governor,
which must at least contain a record of the sum loaned, a description
of the pawn, and the value of the same. For every pledge received a
ticket is given which shows clearly the nature of the pawn and the
amount advanced on the same. The matter of appraisal is left subject
to the rules of each institution, but those making the valuation must
take an oath to fix the sum neither above nor below the value of the




184

BULLETIN OF THE DEPARTMENT OF LABOR.

pawn. I f articles are offered in pawn which are known or suspected to
have been stolen, the loan may be postponed for twenty-four hours, at the
end of which time, unless judicial steps have been taken which may make
a further postponement or detention necessary, the loan must be made
or the pledge returned. In case, however, an article accepted in pledge
is found to have been stolen or lost, the proprietor, upon furnishing the
officials satisfactory proof of its ownership, or presenting an order from
the court, may obtain it without paying either the advance or accrued
interest. In like manner the banks are liable for any damage resulting
to a pledge in their possession, unless it is proved that the damage
was the result of causes which could in no wise have been prevented.
All advances are subject to renewal upon the payment of interest,
but if not redeemed or renewed within fourteen months from the date
of the loan the pledge may be sold at public auction in accordance with
the rules of the institution, which also fix the auction charge. If, how­
ever, when first offered the pledge does not bring an amount sufficient
to cover the loan, it may be reserved for a second sale, and in all cases
any surplus derived from the sale is held for twenty months at the dis­
posal of the rightful owner.
To avoid the expense of establishing branch banks for the conven­
ience of patrons living in outlying districts of the city, the law author­
izes the employment of commissioners (inbrengers). Such persons, as
representatives of the bank, are subject to appointment and dismissal
by its administration and are required to give a bond, the amount of
which is fixed by the same body. They are subject to the rules pre­
scribed for the main institution, and, aside from being under the
surveillance of the officers appointed for that purpose, are held respon­
sible for losses arising from the acceptance of stolen pawns. A t the
close of each day they are required to forward all pawns received and
submit a complete record of the business done. They also act as inter­
mediaries for the redemption of pledges, receiving for their services
such fees as the rules of the administration allow.
Finally, the banks are authorized to receive gifts or bequests given
with the proviso that they are to be loaned gratis, or to receive money
on the same condition from charitable institutions. Such loans are to
be made with the same formality as the advances, but only to persons
whose means of subsistence have been temporarily suspended by sick­
ness, fire, or unavoidable accidents.




PAWNBROKING IN EUROPE AND THE UNITED STATES.

185

P R E SE N T S T A T U S OF TH E P A W N B R O K IN G B U S IN E S S IN
HOLLAND.

In the following table the special features of the several pawn banks
of Holland are shown:
S P E C IA L E E A T U E E S OF P A W N B A N K S OF H O L L A N D .

City.

Am sterdam ___

Character
o f bank.

Comm unal.

Proportion
Com­
o f value Branch
m is­
offices.
loaned.
sioners.

11

(a)
f and |

E n kh u ysen ___

Communal.

The H a g u e -----

Communal.

D e l f t .................

f
a

1
2

(c)
2 and §
(c)

G o u d a ...............

Communal.

L e y d e n .............
IVfafl.aalnis

Communal.

5

Leased . . . .

2

(d)

2

3

R otterdam ........

Communal.

F lu s h in g .........
B ois-le-D uc. . . .
Bergen-op-Zoom
B reda.................

Communal.
Communal .
Comm unal.
Communal.

3
£ and §
# and #
%and §

M a e s tr ic h t___

Communal.

| and §

1

Communal.
Leased ____
Comm unal.
Comm unal.
Communal.
Comm unal.
G roningen........ Communal.

§
|

1

A rn h e m ...........
E lb u r g .............
N y m w eg en ___
Z w olle__
Deventer
Karo pen

L eeuw arden. . .

Communal.

B olsw a rd . - ___

Communal.

Harlingen

Leased . . . .

Lem sterland.. - Comm unal.

f
f and §

•ph- R
Tl(1 -I
TT
To
WiAU
To
£
f
| and §

(a)
2

Smallingerland

L e a s e d ___

1

^neelr

L e a s e d ___

#3 and 4
3-

a A s near the auction value a3 possible.
b A n y amount.
c Entire auction value.

9986—No. 21




1

Months
prior to
sale o f
pledge.

Interest on various classes o f
loans.
A m ouiit o f loan.

Per cent
o f interest
charged.

( $0.16 to
$1. 21
8
6 and 15 { 1.21 to
4.02
10
( 4.02 to 4,020. 00
13
f
. 40 to 120. 60
12
6
15 U20. 60 to 201.00
9
1201. 00 or over.
SI
f
.
20
to
40.20
12
16
\ 40. 20 or over.
10
14
12
(b)
(
. 20 to
40.20
9
15 \ 40. 20 to
80.40
8
( 80.40 or over.
7
40.20
13
14 f . 20 to
l 40. 20 or over.
12
{
. 16 to
40.20
12
1
14 { 40. 20 to
120.60
10
(.120. 60 or over.
f
. 40 to
80.40
12
15 l 80.40 to 120.60
9
15
13
(b)
(
. 20 to
8.04
12
15
8. 04 to
80. 40
10
1 80. 40 or over.
8
16
14 ,
(b)
14 and 17 \
12
(b)
14 I
15 and 13
(e)
15,16, and 17
12
(b)
(
. 20 to
10.05
14
10
10. 05 to
20.10
80.40
14 { 20.10 to
8
7
I 80. 40 or over.
5
1
( /)
. 20 to
40.20
16
14 /\ 40.20
to 201.00
12
14
15
(b)
(
. 20 to
40.20
14
12 \ 40. 20 or over.
10
14
9,10, and 12
(e)
10
14
lb)
14
18,12,and 10
(e)
(
. 20 to
80.40
12
2
13* \ 80. 40 or over.
10
f
. 20 to
20.10
12
1
20.10
to
40.20
10
14 ] 40. 20 to
60. 30
8
[ 60. 30 or over.
6
f
.
20
to
40.20
12
14
\ 40.20 or over.
10
. 12 to
40.20
12
14 f
\ 40.20 or over.
10
(
. 30 to
20.10
15
12
14 < 20.10 to
40.20
( 40. 20 to 120. 60
10
16
f . 20 to
10. 05
14
J
10.
05
to
20.10
14
] 20.10 to
40.20
12
1 40. 20 or over.
10
10
(b)
d Four-fifths o f auction value.
eN ot reported.
F or pensioners.

186

BULLETIN OF THE DEPARTMENT OF LABOR,

The law of 1826 authorizing the communes or municipalities to found
pawn banks gave rise to the communal (gemeentelijJce) and the leased
(verpachte) banks, and by failure to deny the right to individuals made
possible a large class of private pawnbrokers. The communal pawn
banks are those conducted directly by the municipality; the leased are
found in cases where the municipality has given the business into the
hands of private parties or corporations for a limited number of years
upon, payment of a fixed rent, while the private are the result of indi­
vidual enterprise and subject to no legal restrictions.
The leased banks are rapidly decreasing in number, and in 1895 but
five of the twenty-eight pawn banks of the country belonged to that
class, and those were found in the unimportant cities. In the line of
legal restrictions they are subject to the law of 1826 and such regula­
tions as are sanctioned by the Government at the time of their found­
ing. In this they do not differ from the communal banks, but the
regulations for the leased banks make no mention of administration or
the disposition of the profits, that being naturally left in the hands of
the lessee. In the communal banks, on the contrary, a definite com­
mission directs the business, and the profits are paid to the commune
or go to form a reserve fund for the institution. In Amsterdam and
Rotterdam, for example, the bank is gratuitously administered by a
commission of five members appointed by the communal council, the
immediate management being left to a secretary or director, who exe­
cutes the orders of the commission. A t Haarlem and The Hague, how­
ever, the commission has but four members.
The inability of many in the larger cities to reach the main bank led
to the founding of branch banks (bij- o f hulpTcantoren) and to the depu­
tizing of commissioners. Formerly the latter method found favor, but
the many abuses arising from the plan gradually led to its disuse, until
at present the commissioners have been supplanted by the branch
banks in all but three cities. In Amsterdam an effort has been made
to make the main bank a storehouse for the more valuable pledges and
allow the branches to deal with the patrons. To this end the receipt
of pawns by the main bank, save those sent in by the branches, is dis­
couraged, and the following directions given as to the pawns to be for­
warded to it by the branches: All pledges on which 2.5 florins ($1,005)
or less have been advanced are to be held by the branch banks receiv­
ing them; all woolen articles on which 3 florins ($1,206) have been
advanced, and gold and silver pledges on which loans of from 3 to 9
florins ($1,206 to $3,618) have been made, are to be held three months
before forwarding, while gold and silver articles on which loans of from
10 to 100 florins ($4.02 to $40.20) have been advanced, if not redeemed
within a month, as also all articles of a greater value unredeemed at
the expiration of ten days, are given over to the main bank for safe
keeping.




PAWNBROKING IN EUROPE AND THE UNITED STATES.

187

The private pawnbroker enjoys the greatest freedom in his business.
He pays no license fee, is subject to no regulations as to interest or
charges, and is not recognized by the new penal code of 1886. More­
over, not being subject to the law of 1826, he is able to make loans on
articles the communal banks can not accept, such as real property,
ornaments, symbols, etc., used for ecclesiastical purposes, articles
belonging to charitable institutions, military goods, stores, weapons,
tools, machines or implements required by workmen, bonds, shares,
and public securities. But, aside from doing a pawn business in the
lines denied the regular banks, these private brokers conduct houses
of purchase with right of repurchase (Huizen van hoop met recht van
weder-in-hoop)—that is, instead of pledging an article it is sold to the
broker, the owner having the option of repurchase at an advanced price
within a determined period. Lastly, they purchase the pawn tickets
given by the communal banks, and so obtain the right to the surplus
arising from the sale of the corresponding pledges.
As a rule the appraisal of articles offered in pledge is placed in the
hands of persons responsible to the bank for any loss arising from the
sale of unredeemed pledges. The system, however, is not so ironclad
as that of France, as the administration of the bank may, and quite
frequently does, suspend the rule. The basis for the advance varies
with the several cities. In Amsterdam no rule can be given. An effort
is made to loan as near the auction value as possible, but in the case of
loose diamonds 30 per cent of the estimated value is advanced. Prac­
tically the same plan is followed by Gouda and The Hague, while in
other places from two-thirds to three-fifths of the estimated value of
clothing is usually advanced, and from three-fourths to four-fifths of
the value of gold and silver articles as fixed by weight.
All cities supply the pawn banks with registers which, instead of
merely calling for the data required by the law of 1826, usually direct
that the following points be recorded: Number of the pledge; date of
pledging; name of the owner, his trade, age, and residence; description
of the article pawned, its valuation, and the amount advanced on the
same, and the interest to be paid. A ticket must be given in receipt
for each article, which usually bears the name of the bank, the date,
name o f the owner, a description of the article, its valuation, the
amount loaned, the interest to be paid, the time when the pledge will
be forfeited unless redeemed or renewed, and such other items or
instructions as the committee of administration may think proper to
have given or placed upon the ticket.
In the preceding table the column for interest shows the minimum
loan, and also the maximum, where that is fixed. With the exception
of Amsterdam and Zwolle, in cities with a graduated rate the interest
decreases as the amount of the loan increases, the per annum rate on
the smallest loan usually being 12 per cent and sinking to 10 or lower




188

BULLETIN OF THE DEPARTMENT OF LABOR.

for larger amounts. In all cases interest is charged only for the exact
number of days the pawn remains in possession of the bank, instead
of counting fractional weeks or months as whole ones, as is the custom
in many countries.
The following table gives the fees allowed on pledges received by
the branch banks or the commissioners for the four principal cities of
Holland:
FEES

A L L O W E D ON PL E D G E S R E C E IV E D B Y T H E B R A N C H B A N K S OR
COM M ISSION ERS FO R T H E F O U R P R IN C IP A L C IT IE S OF H O L L A N D .
Amsterdam.

A m ou nt o f loan.

Haarlem.
Fee.

$0.16 to $ 0.2 4.... $0.004
.008
.24 to
.3 6 ....
.010
.36 to
.5 0 ....
.012
.50 to
.6 0 ....
.016
.60 to
.8 0 ....
.020
.80 to 1 .0 1 ....
.024
1.01 to 1 .4 1 ....
1.41 to 1 .8 1 ....
.028
1.81 to 2 .0 1 ....
.032
.034
2.01 to 2 .4 1 ....
.036
2.41 to 2 .8 1 ....
2.81 to 3 .2 2 ....
.038
3.22 to 4 .0 2 ....
.040
.050
4.02 to 9 .6 5 ....
9.65 to 4 0.2 0....
.060
40.20 or o v er----.101

Rotterdam.

The Hague.

A m ount o f loan.

Fee.

A m ount o f loan.

$0.40 to
.80 to
2.41 to
4.02 to
6.03 to
8.04 to
12.06 to
16.08 to
20.10 to
24.12 to
28.14 to
32.16 to
40.20 to
80.40 to
120.60 to
201.00 to

$0.008
.020
.028
.040
.048
.060
.080
.100
.120
.140
.160
.180
.240
.280
.400
.600

$0.40 to $0.80... $0.008
.016
.80 to 2.0 1 ...
.024
2.01 to 4 .0 2 ...
.032
4.02 to 8.04...
.040
8.04 to 12.06...
12.06 to 20.10...
.048
20.10 to 30.15...
.060
30.15 to 40.20...
.072
E very
$8.04
.008
above $40.20.

$0.80.
2.41.
4.02.
6.03.
8.04.
12.06.
16.08.
20.10.
24.12.
28.14.
32.16.
40.20.
80.40.
120.60.
201.00.
402.00.

THE

Fee.

A m ount o f loan.

Fee.

$0.20 to $0.30...
.30 to
.8 0 ...
.80 to 2 .0 1 ...
2.01 to 4 .0 2 ...
4.02 to 8 .0 4 ...
8.04 to 12.06...
12.06 to 20.10...
20.10 to 30.15...
30.15 to 40.20...
E very
$4.02
above $40.20.

$0. 004
.008
.016
.024
.032
.040
.048
.060
.080
.008

In addition to the regular interest the branch banks and the com­
missioners are allowed to levy a fee to cover the cost of administration,
or to compensate the commissioner for his labor. While such charges
are invariably small, being less than 1 cent on the smallest loans, they
nevertheless materially increase the regular rate on small short-time
loans. Notwithstanding this increase, however, the rates for Holland
average as low or lower than those of other countries. On small loans
the fees charged in Amsterdam are about the same as those charged
in Rotterdam and The Hague, but are somewhat lower on large
amounts. In Haarlem, where commissioners instead of branch banks
are used, the charges for making advances, except on the smallest
loans, are considerably higher than in other places.
In the two tables following are shown the number of articles pledged,
redeemed, and sold at the pawn banks, together with the total and
average loans on such articles. The first table gives figures for the
whole of Holland for the years 1885 to 1895, the second for the four
principal cities of Holland for the year 1895.




PA.WNBROKING IN EUROPE AND THE UNITED STATES.

189

A R T IC L E S P LE D G E D , R ED EE M E D , A N D SOLD A T P A W N B A N K S OF H O L L A N D ,
A N D T O T A L A N D A V E R A G E L O A N S ON SUCH A R T IC L E S , 1885 TO 1895.
Pledged.
Year.
A rticles.

1885..
1886..
1887..
1888..
1889..
1890..
1891..
1892..
1893..
1894..
1895..

A m ount
loaned.

2, 420, 685 $3,115,127
2,431, 901 2, 976, 265
2, 491,437 2, 958, 234
2, 519, 852 2, 920,123
2, 514,499 2, 863,128
2, 550,767 2, 827, 077
2, 584, 226 2, 801, 450
2, 535,433 2, 737,662
2,330,349 2, 580, 236
2,275, 477 2, 409,150
2,126, 245 2, 294, 937

Redeemed.
A v e r­
age Articles.
loan.
$1. 29
1.22
1.19
1.16
1.14
1.11
1.08
1.08
1.11
1.06
1.08

A m ount
loaned.

2,308,175 $2, 995, 453
2, 372, 671 2,931,096
2,419, 643 2, 886,364
2, 426, 710 2, 829, 332
2,451, 252 2,812, 557
2,459,981 2, 745, 057
2,486, 542 2,704, 653
2, 514, 920 2, 705,105
2, 287, 787 2, 546, 381
2,231, 886 2, 389, 963
2, 088, 531 2,256, 204

Sold.

A m ount
outstand­
A v e r­
A v e r ­ ing
A
m
ount
at end
age
A rticles. loaned.
age
o f year.
loan.
loan.
$1.30
1.24
1.19
1.17
1.15
1.12
1.09
1.08
1.11
1.07
1.08

64, 640
68,322
70, 351
68,179
66, 791
65, 799
64,505
70, 717
67, 955
66, 697
65, 921

$76, 723
82,010
81, 915
78, 292
80, 590
69,494
68, 239
72, 610
68, 971
67, 519
64, 549

$1.19
1.20
1.16
1.15
1.21
1. 06
1. 06
1. 03
1.01
1.01
.98

$1,153,171
1, 090,797
1, 080, 753
1, 093, 024
1, 053, 639
1,054, 498
1, 082, 938
991, 340
927,492
879,109
853, 616

A R T IC L E S P L E D G E D , R E D E E M E D , A N D SOLD A T P A W N B A N K S OF F O U R P R IN C IP A L
C IT IE S OF H O L L A N D , A N D T O T A L A N D A V E R A G E LO A N S ON SUCH A R T IC L E S , 1895.
Pledged.
City,

Am sterdam .............
R otterdam ...............
The H a g u e .............
H aarlem ...................

A rti­
cles.

Redeemed.

A m ount A v e r­ A r t i­
age
loaned. loan. cles.

Sold.

A v e r­
A m ount age
A r t i­
loaned, loan. cles.

762,246 $906, 913 $1.19 745,542 $883, 608 $1.19
447,413 452, 255 1.01 443, 683 451,582 1.02
179, 386 252, 975 1.41 178,640 247,160 1.38
74,350 1.14 64, 049
65, 035
73,588 1.15

24, 572
14, 727
3, 585
1,974

A m ount
A v e r­ outstand­
A m ount age ing at end
loaned. loan. o f year.
$23, 220 $0.94
16, 018 1.09
4, 600 1.28
2,402 1.22

$398, 258
129, 382
91, 535
21, 932

While the amount loaned in Holland has steadily declined from
7,749,071.24 florins ($3,115,126.64) in 1885 to 5,708,799.48 florins
($2,294,937.39) in 1895, the number of articles received gradually
increased from 2,420,685 in 1885 to 2,584,226 in 1891, but since then has
declined to 2,126,245 in 1895. The marked falling off in the amount
loaned is reflected in the average loan, which fell from 3.20 to 2.69
florins ($1.29 to $1.08). In Amsterdam, which does double the amount
of business of any other town in the country, the average amount
advanced, 2.96 florins ($1.19), is above that for the whole country,
and the average of 3.51 florins ($1.41) in The Hague stands in still
greater contrast. The loan in Eotterdam, however, is below the aver­
age. The table for Holland shows that the number of articles redeemed
and sold, the average loan, and the amount outstanding on pledges
at the end o f each year has in general conformed to the increase
or decrease in the corresponding items for the articles pledged. In
the table showing conditions in the four principal cities, however, a
closer study o f the articles redeemed and sold is made possible. In
Amsterdam of the 976,154 pawns subject to redemption 745,542, or 76
per cent, were redeemed, and 24,572, or 2J per cent, were sold. Eightyone per cent of the 550,282 pawns on hand in Eotterdam were redeemed
and 2.7 per cent sold. In The Hague 78 per cent were redeemed and
but 1.6 per cent sold, while in Haarlem 80 per cent were redeemed and
2£ per cent sold.




190

BULLETIN OF THE DEPARTMENT OF LABOR.

The two tables following give the loans on articles sold, amount real­
ized on sales, and surplus of the pawn banks of Holland for the years
1885 to 1895, and of the four principal cities of Holland for the year 1895:
L O A N S ON A R T IC L E S SOLD, R E C E IP T S FROM SALES, A N D SU R P L U S OF P A W N
B A N K S OF H O L L A N D , 1885 TO 1895.

A m ou nt
loaned on
articles
sold.

Receipts
from sales.

Surplus.

Losses on
sales.

Surplus
claimed
w ithin
20-month
limit.

Surplus
unclaimed
within
20-month
limit.

1885 ...................... $76, 723. 35
1886 ......................
82, 010. 01
81,914.56
1887 ......................
1888 ......................
78, 292.03
1889 ......................
80, 589. 52
1890 .................... . 69,494.14
1891......................
68, 239. 21
1892 ......................
72, 609. 76
1893 ......................
68, 971. 46
67.519.38
1894......................
64,549. 24
1895......................

$104,049. 01
109, 069. 76
108,094.38
104, 930. 57
107, 276. 20
95,940. 02
94, 266. 77
95, 744. 60
88,020. 37
85, 257. 03
80, 347.53

$17, 955. 68
17,453.46
16, 938.77
17, 892. 25
18,125.15
18,105. 54
18,197. 36
16, 050. 88
17, 252.84
15, 748. 64
14, 741. 87

$2, 563. 51
3, 246. 98
3, 973.09
3, 746. 29
6, 017.97
2, 402. 78
2, 880. 73
4,129.93
4, 071. 53
4,108.00
5,004. 32

$12,221.38
11,956. 85
11,425.44
12,014. 00
12, 291.10
12, 637. 93
13,120. 95
10, 979. 20
11, 433.17
10, 769. 30
10,132.69

$5, 662. 05
5, 715. 55
5, 996. 75
5, 369.44
5,405.48
5,551.51
5,417. 89
5, 669. 52
5, 362.29
5, 012. 36
5,192.12

Year.

Surplus
available
at end o f
year.
$382.21
13, 257. 29
12, 773. 88
13, 282.69
13,939.19
13,701. 67
13, 360.19
12, 730. 83
13,130. 51
12, 931.11
12,277.09

L O A N S ON A R T IC L E S SOLD, R E C E IP T S F R O M SA LE S, A N D S U R PLU S OF P A W N
B A N K S OF F O U R P R IN C IP A L C IT IE S OF H O L L A N D , 1895

A m ount
loaned on
articles
sold.

Receipts
from sales.

A m sterd a m ........ $23,220.02
R o tterd a m .........
16, 017. 89
T he H ague.........
4, 600.49
2,402.35
H a a rlem .............

$31, 083. 29
10, 937. 05
5, 754. 97
3, 238.54

City.

Surplus.

Losses on
sales.

Surplus
claimed
within
20-month
limit.

$7,494.05
2,260. 98
1,426. 83
623.87

$358.99
2, 924. 57
102.83
71.55

$5, 529.95
1, 269.58
1,172. 75
346.94

Surplus
unclaimed
Surplus
w ithin
available at
20-month end o f year.
limit.
$2, 256.17
910. 99
463.87
248.16

$6,028.08
2,150. 32
692.06
550.90

The articles sold by the pawn banks of Holland in 1885 produced a
surplus of 44,665.88 florins ($17,955.68), or 23.4 per cent of the amount
loaned. In the same year the total loss arising from the sales was
6,376.89 florins ($2,563.51), or 3.3 per cent of the amount loaned. The
surplus for 1895 was 22.8 per cent of the total sum loaned on the pledges
sold, while the loss was 7.8 per cent. In Amsterdam the surplus of
18,641.92 florins ($7,494.05) was 32.3 per cent of the amount advanced
and the loss was 893.02 florins ($358.99), or 1\ per cent of the same sum.
The surplus was lower in Rotterdam, the per cent being 14.1, while the
loss was greater, being 18.3 per cent. The auction at The Hague in the
same year netted a 3L per cent surplus and 2.2 per cent loss, while in
Haarlem the same items were 26 and 3 per cent, respectively. A s the
surplus is held for twenty months subject to the demand of the owner,
it is impossible to give a definite statement as to the proportion
claimed in Holland; but as 25,205.70 florins ($10,132.69) of the available
surplus was paid to the owners in 1895, and but 12,915.72 florins
($5,192.12) unclaimed surplus fell to the banks, it is safe to say that at
least 60 or 70 per cent of the surplus is ultimately claimed.




PAWNBROKING IN EUROPE AND THE UNITED STATES.

191

The following table shows the capital and profits of the pawn banks
of Holland for the year 1895:
C A P I T A L A N D P R O F IT S OF T H E P A W N B A N K S OF H O L L A N D , 1895.

City.

Am sterdam ........
H aarlem .............
E nkhu ysen.......
T e x e l..................
The H a g u e ........
D e l f t ...................
G ou d a.................
L e y d e n ...............
M a a sslu is.........
R o tte rd a m .......
F lu s h in g ...........
B ois-le-D uc........
Bergen-op-Zoom
B r e d a .................
M a e s tr ic h t........
A rn h e m .............
E lburg ...............
N y m w eg en .......
Z w o lle.................
D e v e n te r...........
K a m p en .............
G roningen.........
L eeuw arden----B olsw a rd ...........
H a rlin gen ..........
Lem sterland----Smallingerland .
Sneek...................

Capital
belonging
to bank.

Borrowed
capital.

A vailable
surplus.

Other
credits.

$298,908.95
22, 876. 99
6, 432. 00

$193,563.00
5, 234. 85

$6,028. 08
550. 90
241.29

$6, 588. 24
479.54

1,206. 00
92,689.91 ......................
2, 575. 34
6, 030. 00
...................
15, 551.75
26, 934. 00
1,541.89
75,921. 55
88,440. 00
2, 039.49
7,336. 50
4, 681.28
21, 708.00
885.59
4, 221.00
5, 335. 33
8,442.00
10,917.41
1, 005. 00
26, 532. 00
10, 854. 00
9, 298. 90
7, 521.50
5, 628. 00
6, 030.00
5, 568. 58
14.59

(&)

(b)

(&)

a Loss.

6, 834. 00
1,407. 00
5, 226. 00
13, 266. 00
21,306. 00
2, 211.00
(&)

1,286.40
(&)

(&)

692. 06
117. 81
285.89
354. 50
2,150. 32
53.62

7, 543. 91

124.79
317. 84
30. 33
235. 57
1.29
101.27
119.28
149.54
25. 60
527.78
143.19

2,412.00
1, 508.13
576. 26
68.74
14.74
485. 40
2, 010.00

(b)

(b)

4.02
22.11

(b)
(&)

Total.

$505,088. 27
29,142.28
6, 673. 29
1, 206. 00
93, 381. 97
8, 723.15
15, 837. 64
27, 288. 50
1,541.89
174, 055. 78
9,429. 61
26, 389. 28
7, 643. 38
15, 603.10
12,529. 00
26, 767. 57
70. 03
10, 955. 27
16, 252.18
9,092. 78
10, 879. 60
20,309.18
29, 027. 77
2,225. 59
(b)
1, 286.40
(b)
(b)

Profits.

$3, 528.01
479. 54
241. 29
a 5.04
1, 489. 84
a 424.91
a 57. 00
a 238. 85
227. 29
a 849. 51
a 210. 83
cl 256. 22
a 47.59
302.13
148.16
a 750. 93
45.92
a 766.20
a 12.45
56. 04
a 366. 36
99. 52
a 198. 03
a 17.77
427. 05
a 78. 92
180.19
291.14

6 Not reported.

Of the total capital reported by 25 pawn banks of Holland during
the year 1895, 56 per cent were funds properly belonging to the banks,
and 41 per cent was borrowed capital, the remaining 3 per cent being
either unclaimed surplus or miscellaneous credits. Of the individual
banks, those of Texel, Gouda, Arnhem, and Lemsterland borrow their
entire capital, while at Enkhuysen, The Hague, Leyden, Maassluis, and
Nymwegen the banks own their entire capital. Eotterdam owns 44 per
cent o f its capital and borrows 51 per cent, and Amsterdam, slightly
above the average of the remainder of the country, has 59 per cent of
the capital it uses and borrows 38 per cent.
From the standpoint of profits the pawn banks of Holland are not
a financial success. The constant endeavor of the authorities to loan
at the lowest possible rate of interest, coupled with the low value of the
pledges offered, has not only tended to depress the margin of profit,
but in many cases resulted in an actual loss. In 1895 fifteen of the
pawn banks suffered a net loss of 10,648.28 florins ($4,280.61), and
thirteen secured a total profit of 18,696.82 florins ($7,516.12). These
figures are the more striking when it is understood that they include
the unclaimed surplus. To illustrate, the profit of 8,776.15 florins
($3,528.01) reported by Amsterdam includes 5,612.37 florins ($2,256.17)
of unclaimed suriflus and but 3,163.78 florins ($1,271.84) as net profit,
while Eotterdam, after receiving 2,266,14 florins ($910.99) from the




192

BULLETIN OF THE DEPARTMENT OF LABOR.

unclaimed-surplus account, still suffered a loss of 2,113.22 florins
($849.51); that is, the expenses of the administration exceeded its
receipts, from interest and charges, by 4,379.36 florins ($1,760.50).
GERMANY.
L E G IS L A T IO N O N T H E F A R T O F T H E C E N T R A L G O V E R N M E N T .

The conflict waged with usury in Italy and Belgium was fought out
in Germany with a similar result. At flrst the cities sought to control
interest charges by legalizing a maximum rate; but failing, they nar­
rowly limited the articles that could be accepted in pawn and made
the sale of unredeemed pledges a purely legal matter. The result was
still unsatisfactory, and measures of more or less severity followed
each other in a vain endeavor to harmonize conflicting interests. Yet
throughout the entire conflict, save the somewhat doubtful attempt
at Freisingen in 1198, no effort prior to 1591 was made to found a
mont-de-piete as a relief measure.
In that year the authorities at Augsburg forbade the Jews to loan
money within the city, and appropriated funds to found a loan bank
(Leihhaus), and in 1618 Nuremberg followed its neighbor’s example.
But the Thirty Years’ War now denied the subject further attention,
and before its close we find the pawn business combined with banking
in such institutions as the uKommerz Bank” of Gassel and the “ Lom­
bard Haus” at Frankfort on the Main. The union, however, was not
permanent, and before the close of the eighteenth century several cities
had established institutions for the sole purpose of advancing money
on pledges. Indeed, so far had this differentiation gone that in 1787
the Prussian Government passed a general law for the control of the
business, whether municipal or private.
The prime object of the law was the control of the private broker,
but so minute were its stipulations that its enforcement meant to ruin
the business. To avoid this the declaration of 1803 was given, with
the express purpose of lessening the difficulty of the sale of unredeemed
pledges. Yet the law failed to thwart the usurer, and it was decided
to officially further the establishment of public pawn shops as a cor­
rective measure. This was effected by the cabinet order of 1826,
which provided that the authorities of the several States should be
empowered to sanction the erection of such institutions, upon applica­
tion of the cities, in places where the public needs demanded. The
States were authorized to enact needed legislation for the administra­
tion and control of the same, provided such legislation did not conflict
with the law of the land. This was in turn to be supplemented by the
municipal authorities in such manner as the needs of the city required.
They, in behalf of the city, were to guarantee the necessary funds and
assume the entire responsibility of supervision. If, however, a city
did not desire to conduct the business, it might lease it to private par­




PAWNBROKING IN EUROPE AND THE UNITED STATES.

193

ties, bat if the municipal institutions supplied the needs of the public,
permits should not be granted to private brokers. Finally, the rate of
interest was fixed at 8 per cent per annum; but if this proved insuf­
ficient to meet expenses, 12% per cent could be charged.
One of the prime results of this act was the founding of the Royal
Loan Office at Berlin {Konigliehes Leihamt fu r Berlin), which is still
conducted according to its provisions; yet the office at Berlin is not a
municipal, but a State, institution. At the time of the passage of the
above act the city felt unable to supply the necessary funds; but the
need of such an institution was imperative. Finally in 1834 the Royal
Commercial Company (Konigliehes Seehandlungs Institut) appeared as
a benefactor, offering its services and funds. To enable the city to
avail itself of this aid a special act was passed giving the company
charge of the business. The necessary capital is supplied by the com­
pany at 4 per cent per annum, and any surplus remaining after interest
and all expenses are paid is turned over to such charitable purposes as
the city officials may direct.
It seems probable, however, that the law of 1826 did not meet with
the ready response that was expected, as in 1838 an act was passed
authorizing the savings bank (Sparhasse), upon proper guaranties, to
supply the capital needed to erect and administer the municipal pawn
shops. The immediate effect of the law is in doubt, but the fact that
the majority of the municipalities at present obtain all or a part of their
capital for this purpose from the savings bank shows its ultimate
usefulness.
As previously intimated, the object in furthering the founding of
State and municipal pawn shops was to prevent abuses practiced by
the private pawnbroker, chief among which was the practice of pur­
chasing articles with the right of repurchase at an advanced price prior
to a certain date. This u Riickkaufshandler,” as he was called, was the
exact prototype of the “ dolly-man” of England, and as such has ever
been subject to adverse legislation. Prior to 1869, however, his busi­
ness had been held in check, but in that year, by placing additional
restrictions on the private broker and failing to prohibit this form of
the business, all restraint was removed. The result was immediately
apparent. Flagrant abuses arose; these dealers outnumbered the
regular pawnbrokers six to one, and interest on loans rose to 10 per
cent per month.
This evil gave rise to the imperial law of June 23, 1879, which fixed
the present status of the business. In the main the law is a reenactment
of that of 1869, save that the definition of a pawnbroker is extended
to include those who purchase with the right of repurchase and that
it is expressly stated that no one may follow the business of a pawn­
broker without a permit (Krlaubniss) from the central authorities of
the city or district. And to further place the control in the hands of
these authorities they are permitted to make the granting of this per­




194

BULLETIN OF THE DEPARTMENT OF LABOR.

mit dependent not alone on the financial responsibility and moral
character of the applicant, but on the need of the community for
further facilities in this line. Lastly, the States were authorized to
make such further regulations for the control of the business as seemed
necessary for its proper conduct.
R E C E N T L E G IS L A T IO N B Y T H E S T A T E S .

Following the enactment of the law of 1879, authorizing the States to
make the needed regulations for the business, Prussia enacted the law
of March 17,1881, which was later extended to Bavaria. A year later
Saxony followed its neighbors7example, but has since allowed the law
to lapse. The remaining States have not deemed it necessary to enact
new laws, preferring to allow the business to be ruled by those previously
enacted.
The law of 1881 is the most recent legislation on the subject, not only
as regards Germany, but also as regards France, Belgium, and Holland.
At present it finds direct application to but two cities, Essen and Altona,
public pawnshops having been founded in these cities since its passage.
Seven other cities, however, have voluntarily modified their regulations
to meet its requirements, and without doubt it will ultimately find appli­
cation to all the cities of Prussia, as the minister of the interior is
empowered to cause its application to any or all pawnbrokers whenever
in his judgment it is advantageous to do so. Its provisions fix the maxi­
mum interest rate at 2 per cent per month, or fraction thereof, for all sums
of 30 marks ($7.14) or less and 1 per cent per month on all sums above
that amount. Interest may be demanded for two months, but in reck­
oning the time the days of making and paying the loan are to be counted
as one. No charges in excess of the interest are allowed, and any sum
so taken by the broker may be demanded by the pawner any time within
five years from date of taking, the broker being obliged to return the
same, together with interest at 5 per cent. Legal possession of the
pawn is obtained only by registering the same in chronological order in
a register furnished by the authorities for that purpose and giving a
pawn ticket bearing the broker’s signature. The contents of the ticket
must be the same as the corresponding entry in the pawn register and
give the following points: The number the pledge bears in the register,
place and date of transaction, full name of pawner, amount of loan,
amount of monthly interest to be paid, character of pawn, and time of
payment of loan. A pledge may be redeemed at any time upon pre­
sentation of the ticket, but the broker may not demand payment before
the expiration of six months from the date of the loan. In case the
pledge is not redeemed prior to the expiration of the loan, the broker,
without judicial sanction, may sell the pawn to satisfy the debt and
interest. The sale of ail pawns must be public, conducted by a person
appointed for the duty, and may not occur prior to four weeks after the




PAWNBROKING IN EUROPE AND THE UNITED STATES.

195

expiration of the loan, having first been advertised according to the
rules governing the same and in the paper or papers designated by
the local police authorities. Gold and silver articles, jewels, or objects
having an exchange price shall not be sold below the bourse quotations
for that date. No bid being made equal to this, the auctioneer may sell
the same at private sale at the admissible price. If several pawns
belonging to the same person are offered for sale, the owner may desig­
nate the order in which they shall be sold, the sale to cease as soon as
an amount is realized which suffices to cover the sum advanced,
together with costs and interest, any remaining articles to be returned
to the owner. The cost of advertising the sale is to be distributed
according to the number of the pawns offered, the cost of the sale to
be apportioned according to the value of the pawns actually sold.
Immediately after the auction the broker is required to deduct cost of
sale, pawn debt, and interest and upon demand pay any remaining sur­
plus gained from the sale of a particular pledge to the rightful owner;
but if after a period of fourteen days any sums remain unclaimed, they
are to be deposited with the treasurer of the poor fund, who holds the
same subject to demand for one year, at the expiration of which time
they become the property of the poor fund.
S T A T U S O F T H E P R IV A T E P A W N B R O K E R .

While the law of Germany distinctly recognizes the private pawn­
broker the preference given the cities has tended to lessen his impor­
tance. Since the more recent enactments several cities have established
pawnshops while others, already supplied, have started branch institu­
tions, thereby doing away with the necessity of tbe private broker in
outlying districts of the city. Moreover, although the private broker
will often loan on the terms given by the municipal pawnshop, the peo­
ple show a preference for the latter. Indeed, so far is this true that,
having no fear of their competition, but seven cities of the Empire
have availed themselves of the provision of the law which enables
them to make the granting of permits subject to an existing need.
Yet with free range in all the cities of Germany, with these seven
exceptions, but 138 private pawnbrokers were reported in 1894, some
30 of whom were in the city of Berlin.
In the matter of control the private broker is subject to the strict
surveillance of the city police. He is not, however, governed by the
rules adopted by the city and sanctioned by the provincial authorities
for the control of the municipal institution, but by the law of the State
in which he resides. In this way he is able to charge a rate of interest
higher than that usually prescribed for the public pawnshop and
thereby make a fair competence in remote districts of the larger cities
or in small places devoid of a municipal institution.




196

BULLETIN OF THE DEPARTMENT OF LABOR.
A P P L IC A T IO N OP L A W S TO A C T U A L B U S IN E S S .

The following table shows the length of loans and the minimum
amount advanced, and the interest and charges collected by the
municipal pawnshops of Germany:
L E N G T H OF LO A N S, A M O U N T LO A N E D , A N D C H A R G E S C O LL E C T E D B Y M U N IC IP A L
PA W N S H O P S OF G E R M A N Y .

City.

A lte n b u r g ........

Length M in i­
o f loan mum
(mos.). loan.

Annual interest
charged.
A u ction charge.

6 $0.714 /$ 0 .714 to $7.14
\
Over 7.14

18
12

r$0. 238 to $2.38
.238 \ 2.62 to 7.14
(
Over 7.14

24
18
12

A l t o n a .............

6-12

A n sp a ch ...........

6

A u g s b u r g ........

12

B a m b e r g .........

12

B arm en.............

12

B a u tz e n ...........

6

B aireuth...........

10

B erlin ................
B o n n .................
B r u n s w ic k ----B reslau.............
B rom berg.........

12
12
6
6
6

C arlsruhe.........

kQ

C a s s e l...............

kl2

C elle...................

6

C hem nitz.........
C oblentz...........

6
12

C r e fe ld .............

12

D antzic.............
D e tm old ...........

6
6

r$0.476 to $23.56
.476 <23. 80 to 118.76
[119.00 or over.
(
$0.476
.714
I
.952
.476
\
1.19
$1.43 to 2. 86
{
Over 2.86
.476
A n y amount.

Total
cost
divided
equally among pawns
sold.
Cost o f advertisement
according to nu m ber;
cost o f sale in propor­
tion to value.

10
8 |5 per cent o f sale p r ic e ..
a6
(b)
(c)
T ick e t,! ce n t; 4 per
(d)
j>3 per ce n t..........................
cent o f surplus
(e)
. claimed.
(/)
10
12 5 per cent o f sale p rice .. fT ick et and renew\ al, each, 1J cents.
f $0. 357 to $7.02
3 per cent o f loan
12£
.357 \. 7.14 to 35. 58
10 |4 per cent o f sale p rice ..
i f not redeemed
( 35. 70 or over.
8
before sale.
/
$0.238
to
$7.14
18
.238
\
Over 7.14 g io j>2 per cen t..........................
T ick et and renew ­
al, each, on loans
.238
A n y amount.
12 5 per cent.
o f $0,238 to $1.19,
1J cen ts; $1.19
to $119,2J cents.
h. 476
A n y amount.
i 12 2 per cent o f sale p r ic e ..
.476
A n y amount.
j 12 2 per cent o f sale p r ic e ..
.714
A n y amount.
6 4 per cent o f loa n ...........
.476
A n y amount.
12
.476
A n y amount.
12 Legal auction charges ..
2 per cent o f sale price,
7
.476 f$0.476 to $47. 60
but not less than 1£
\
Over 47. 60
a6
cents nor over $2.38.
.238
2£
cents for each $0,714. (D
(D
( $0.476 to $3. 57 m 15
.476 \ 3.57 to 7.14 m l2 j>5 per ce n t..........................
l
Over 7.14
m8
A n y amount.
.476
12 5 per cent o f loa n ...........
A n y amount. n l2 3 per cen t..........................
.357
A ppraisal and re­
newal, each, on
loans o f $0,238
to $1.19,1! cents;
$1.19 to $2.38, 2\
cen ts; $2.38 to
A n y amount.
12 5 pe1' cent o f sale p r ic e ..
.238
$7.14, 3| c e n ts ;
$7.14 to $11.90, 5
cen ts; $11.90 to
$23.80, 9| cen ts;
each additional
. $11.90, 4f cents.
A n y amount.
$0.714
12 4 per cent o f sale p rice ..
A n y amount.
5
.238

a Smallest charge, T£ cents.
b | cent per month.
c 1£ cents per month.
d 1| cents per month.
e 2 cents per month.
/ 2\ cents per month.
g Interest to be paid for at least two months.
Smallest charge, 2\ cents. Interest on stocks,
bonds, etc., 4 to 5 per cent.
7iAt tw o branch offices the minimum loan is
$0,714.
i 6 per cent on stocks, bonds, etc.




Other charges.

Per
A m ount o f loan. cent.

1

!

{

{

j Smallest charge | cent per month. On loans
o f $0,476, therefore, the interest is 18 per
cent per year.
k Stocks, etc., three months.
I Annual interest on loans o f $0,238, 3£ ce n ts;
$0,476, 6 c e n ts ; $0,714 to $35.46, ^ cent (x%
pfennig) per week for each $0,238; stocks,
etc., 4 to 4£ per cen t; smallest charge, 2\
cents.
m Interest to be paid for at least tw o months.
n Smallest charge, | cent.

PAWNBROKING IN EUROPE AND THE UNITED STATES.

197

L E N G T H OP LOAN S, A M O U N T LO A N E D , A N D C H A R G E S COLLE CTE D B Y M U N IC IP A L
PA W N S H O P S OF G E R M A N Y —Continued.

City.

A nnual interest
charged.
Length M ini­
o f loan mum
(mos.). loan. Am ount o f loan. Per
cent.

Darm stadt........

3

.476

A n y amount.

n

D ortm u n d ........

12

.238

A n y amount.

12

.714

A n y amount.

69

D re sd en ...........

D usseldorf........

12

.238

f$0. 238 to $23. 80
\
Over 23.80

12
10

D u isb u rg.........

12

.238 / $0. 238 to $7.14
\
Over 7.14

c24
c l2

E lb erfeld .........

12

( $0. 357 to $7. 02
.357 < 7.14 to 35.58
( 35.70 or over.

12
10
8

E lb in g...............

10-18

.714

A n y amount.

121

Em den...............

12

E r fu r t ...............

6

r $0,119 to $3.57
.119 \ 3. 57 to 71.40
/
$0.476 to $7.14
.476
\
Over 7.14

(d)
c 18
c l2

E ssen.................

6

.476 / $0.476 to $7.14
\
Over 7.14

elS

F le n sb u rg ........

6

.238 ( $0. 238 to $7.14
\
Over 7.14

24

F rankfort on
the Main.
F reiburg . . . . . .

12

F i i r t h ...............

gQ

F u ld a ...............

06-18

12

12

12

.714

A n y amount.

/12

.476

A n y amount.

h 10

.238

A n y amount.

6f

Other charges.

A uction charge.

R egister fee, 24 per
cent o f loan. 3
per cent o f sur­
plus claimed.
\ per cent o f sur­
plus claimed, if
5 per cent.
over $7.14.
5 per cent o f sur­
plus claimed, if
5 per cent o f loan.
over $0,119.
Appraisal and re­
newal on loans o f
$0,238 to $1.07,1£
cen ts; $1.19 to
$3.45, 24 cents;
$3.57 to $7.02, 34
cents; $7.14 to
j>5 per cent o f sale p r ic e .. < $17.73, 6 cents;
$17.85 to$35.58,12
cen ts; $35.70 to
$71.28, 23f cents;
over $71.28, 4 per
cent., 14 cents,
each, for redemp­
tion and paym ent
o f surplus.
Cost o f advertisement
according to nu m ber;
cost o f sale in propor­
tion to proceeds.
T icket, 1J cents ;
appraisal, 4 per
>2 per cent o f sale p r ic e ..
cent;
redem p­
tion, 1 cent.
5 per cent o f sur­
f2i cents for each $0,714
plus
claimed.
\ loaned.
Renewal, 24 cents
fo r each $0,714.
Proportioned according
to number.
5 per cent o f sale p rice;
cost o f advertisement.
Cost o f advertisement
according to num ber;
cost o f sale in propor­
tion to proceeds.
j>5 per cent o f sale p r ic e ..
[First $23.80, 5 per cent;
for each additional
l $0,238, 2 per cent.
3 per cen t........................ .
Ticket, 24cents; 5
per cent o f sur­
plus claim ed; re­
2 per cent o f sale p r ic e ..
demption, 7 per
cent o f loan and
interest.
4 per cent o f loan.

{

{

Gera...............

3

f $0. 238 to
4.76 to
.238 { 35.70 to
Over
l
(i)

.357

13
$4. 76
35. 70 ! 10
83.30 1
8 ►
3per c e n t..
83.30 1
H
; (i)

A n y amount.

a F or gold, silver, and jew elry, 12 months.
6 6 per cent on stocks, bonds, etc.
c Interest to be paid for at least two months.
d Interest varies according to a fixed table from
12 to 6 per cent. Loans can not exceed
$71.40.




12

("Surplus, 4 cent for
\ each pledge.

/A ppraisal, § per
cent. T ick et for
loans o f $2.38 or
less, | cen t; $2.38
to $11 .66,14 cents;
10 per cent o f sale price.
$11.66 to $23.56,
24cents; $23.56to
$47.36, 4f cents;
each additional
l $23.80, 24 cents.

e On sums less than $7.14, interest to be paid for
at least tw o months.
/ Interest to be paid for at least three months.
g Stocks, etc., three months.
h Smallest charge, 2| cents.
i Stocks, bonds, etc., 4 to 4 per cent.

198

BULLETIN OF THE DEPARTMENT OF LABOR.

L E N G T H OF LOA N S, A M O U N T LOAN ED , A N D C H A R G E S C O L L E C T E D B Y M U N IC IP A L
P A W N S H O P S OF G E R M A N Y —Continued.

City.

A nnual interest
charged.
Length M in i­
o f loan mum
(mos.). loan. A m ount o f loan. Per
cent.

Miinchen-Glaclbach.

6 $0,238

G o r li t z ............. [
H alberstadt . . . ,

6

Halle

12

H amburg
H am m ----

12

H anau-----

8-12

Hanover.

6

H e id e lb e rg ___

6

H ildesheim ___

12-19

H o f.....................

6

. 238
. 238

.476

A n y amount.

A n y amount.
A n y amount.

$0.476 to $7.14
Over 7.14

A n y amount.
.238
/ $0. 238 to $2. 38
.238 \ 2. 38 or over
f $0. 238 to $4. 76
I 4.76 to 35. 70
.238 ) 35.70 to 83. 30
[
Over 83. 30
$0. 238 to $3. 57
3.57 to 7.14
7.14 to 11. 90
11. 90 to 19. 04
Over 19.04
!/ $0.476 to $35. 70
.476 \
Over 35. 70
$0.119 to $3. 57
.119 \
Over 3. 57
A n y amount.
.476

12

3 per cent o f loan.

12

2 per cent o f loan...........

K o n ig sb erg___

6

C o lo g n e ...........

12

12

13
10
8 *>3 per cent o f loan.

H

a 15 !
a 12
a 10 >$0,238 to $7.14,5 p ercen t;
a8
over $7.14, 2 per cent.

«6

j>4 per cent o f loan.
al2h
a9
5 per cent o f loa n ...........
Cost o f advertisement
according to nu m ber;
1 per cent o f sale price.

1

$0. 476 to $47.60
47.84 or over.

Landshut.

.238

A n y amount.

12

.714
.714

A n y amount.
A n y amount.

d8
e!2

a Interest to be paid for at least tw o months.
b Smallest charge,
cents.
c Smallest charge, 3£ cents.
d 6 per cent on stocks, bonds, etc.




$7.14, 5 per cent;
over $7.14, 2 per
cent.
(2% cents for re\ newal.
T icket and renew­
al, each, 2\ cents.

3 per cent o f loa n ...........

.476

6
6

after
{Redemption
expiration
of
loan, $0.238 to

34 per cent o f loa n .........

Constance

L eipsic .
Liegnitz

A ppraisal and re­
newal, each, on
$0,238 to $1.07, 1|
cents; $1.19 to
$3.45, 2£ cents;
$3.57 to $7.02, 3^
cents; $7.14 to
$17.73, 4| cents;
1 $17.85 to $35.58,
12cents; $35.70to
$71.28, 23f cents;
$71.40 or over, ^
percent. 1^ cents
each, for redem p­
tion and p a y­
ment o f surplus.

rCost o f advertisement
4 cent
pawn.
Other costs on loaus o f
less than $23.80, 5 per
a 24
cent; $23.80 to $71.40,
a 12
| 3 per cen t; $71.40 to
| $238, 2 per cent; $238
to $357, 1 per cen t;
( over $357, £per cent.
12 6 per cent o f sam p rice ..
24

/ $0.238 to $71. 40
.238 \
Over 71.40
$0.476 to $3. 57
3.57 to 7.14
7.14 to 71. 40
.476
71.40 to 238.00
Over 238. 00

(d)

Other charges.

124 4 per cent o f lo a n ...........

/ $0. 238 to $4. 76
.238 \
Over 4. 76

K iel

A uction charge.

6 iA ccord in g to n u m b er...
(d) )

5 per cent o f loan

T icket for loans o f
$0,476 to $3.57, 2\
cents; 3.57 to
$7.14, 4f c e n ts ;
$7.14 to $11.90,
7£ ce n ts; over
$11.90, 9£ cents.
Ticket, 1^ ce n ts ;
renewal,
2£
ce n ts ; appraisal
on amount s o f
$4.76 to $11.90,
4| ce n ts ; $12.14 to
$23.80, 9£ cen ts;
each additional
$11.90,2\ cents.

4 per cent o f sale p r ic e ..

e Interest to be paid for at least tw o m onths;
smallest charge. 2\ cents ; 6 per cent on loans
on deposit books o f savings banks o f L ieg­
nitz.

PAWNBROKING IN EUROPE AND THE UNITED STATES.

199

L E N G T H OF LO A N S, A M O U N T LO A N E D . A N D C H AN G E S COLLE CTE D B Y M U N IC IP A L
P A W N SHOPS OF G E R M A N Y —Continued,

City.

L u b eck .............

M a gd eb u rg-----

Annual intere *st
charged.
Length M ini­
o f loan mum
(mos.). loan. Am ount o f loan. Per
cent.

A n y amount.

a6

6 per cent o f sale p rice..

( $0. 238 to $7.14
7.14 to 23.80
.238 \
{
Over 23.80

18
(D
(0

^0.238 to $23.80, 5 per
cent; $23.80 to $71.40,
3 per cent; $71.40 to
$238, 2 per cent; $238
to $1,190, 1 per cent;
over $1,190, Jp er cent.

6 $0. 238

6

.714

Any amount.

M e n tz ...............

12

M annheim ........

6

r $0.476 to $3. 57
.476 \ 3. 57 to 41. 65
1
Over 41. 65

M a r b u r g .........

6

( $0. 357 to $17. 85
.357 \ 17.85 to 71. 40
(
Over 71. 40

M em el...............
M e t z .................

9
12

M iilh a u sen ----- !

6

i
i
M u nich............. !

/1 2

M u n ster...........
N aum burg........
N e isse ...............

.714
.476

A n y amount.

.476

A n y amount.

A n y amount.
.476 f$0.476 to $7.14
l 7.14 or over.

A n y amount.
.238
6
/$0.238 to $7.14
.238 l
6
Over 7.14
A n y amount.
6 ■ .714

N urem berg-----

13

.476

Offenbach.........

6

.476

O p p e ln .............

6

.714

Osnabnrg.........

6

f$0. 357 to $23. 80
.357 t
Over 23.80

A n y amount.

is)

A n y amount.

a Interest to be paid for at least three months.
b First $7.14, 18 per c e n t; for remainder, 12 per
cent.
c F irst $7.14, 18 per cent; next $16.66, 12 per
cent; remainder, 9 per cent.




A uction charge.

Other charges.

Appraisal fee $0,238
to $0,476, l i cents;
$0,714 to $1.43, I f
cents; $1.43 to
$7.14, 3^ cents;
$7.14 to $23.80, 6f
cents; $23.80 to
$119, 13^ cen ts;
$119 to $238, 20
cents.

rTicket and pack­
ing, 1£ cents.
I Appraisal,
2£
12 3 per cent o f sale p rice .. | cents; for loans
over $1.19, 1 per
l cent additional.
10 3 per cent o f sale price
o f pledges which pay
8
less than 10 per c e it .
6
'T icket, \ cent for
each $0,714; on
16
5 per cent o f loan.
loans o f over
8
$71.40 on stocks,
dQ
„ etc., no charge.
\2\ cents for each $0,714
e 12^ t o f proceeds.
10 6 per cent o f sale p r ic e ..
el8 5 per cent o f sale price;
cost o f advertisement.
el2
T icket and renew­
al, each, on $0,476
to $1.19,1£ cents;
12 5 per cent o f loan.
$1.43 or over, 2£
„ cents.
24 A ctual cost o f auction..
24 jL ega l auction charges ..
12
12
rTicket and renew9 5 per cent o f sale p r ic e .. < al, each, 2| ce n ts;
1 packing, 1£ cents.
A ccord in g to fixed
table, appraisal,
i cent on $0,238
to 20 cents on
§ cent on $0,238 up to 79
$23.80; register
cents on $23.80, ac­
iff)
fee on deposits,
cording to fixed table.
renewals, and re­
demptions, lce n t
on $0,238 to 8
cents on $23.80.
10 2\ cents for each $0,714.
R egister fee on
loans and renew­
als o f $0,357 to
$0,714, 2\ cents;
$0,714 to $3.57, 4f
cents; $3.57 to
$7.14, 7£ cents;
12 13 cents for each $0.714...
$7.14to$14.28,14i
8
cents; $14.28 to
$23.80, 21| cents;
$23.80 or over, 1
per cent. Each
$0,714 o f surplus
claimed, 6 cents.
d Loans over $71.40 on stocks, etc., 4£ per cent.
e Interest to be paid for at least tw o months.
/S t o c k s , etc., three months.
# Charges, 12 to 7| x>er cent according to fixed
table.

200

BULLETIN OF THE DEPARTMENT OF LABOR.

L E N G T H OF LOAN S, A M O U N T LO A N ED , A N D C H A R G E S C O LL E C T E D B Y M U N IC IP A L
P A W N S H O P S OF G E R M A N Y —Concluded.

City.

P a d erb orn ........

R a t is b o n .........
Schweidnitz . . .

Annual interest
charged.

Length M ini
o f loan mum
(mos.). loan.

A m ount o f loan.

6 $0.714

A n y amount.

6

. 238

A n y amount.

8
13

.714
.476

A ny amount.
A n y amount.

12

A uction charge.

12 A ccord in g to n u m b e r...
rLegal charges, but not
a 12 < over '1 cents for each
( $0,238.
&12 5 per cent o f loa n ...........
8 5 per cent o f loan...........

Ticket, 1£ ce n ts;
renewal,
ents.
For paym ent o f
surplus, cost o f
public notice.
T ick et and renew ­
al, each, 1 per
5 per cent o f loan
cent o f lo a n ; ap­
praisal, 4 per
cent.
Ticket, U cents for
each $0,238. R e­
newal, first time,
A ctu a l cost o f a u ctio n ..
1£cents; second,
1 cent; third, f
cent for each
$0,238.
Cost o f advertisement
o f sale according to
number o f pawns; o f
k sale, to sale price.
A ppraisal and re­
5 per cent o f loa n ...........
newal, each,£ per
cent.
|8 per cent o f sale p rice .. T icket, 2\ cents.

.714

A n y amount.

cents for each !
124 \ loaned.

S chw ein furt. . .

12

.476

A n y amount.

10

S ch w erin .........

3

. 238

A n y amount.

6

Stralsund.........

6

.238 f$0.238 to $7.14
\
Over 7.14

24
12

S tr a s b u rg ........

12

.476

A n y amount.

.476 r$0.476 to $7.14
\ 7. 38 or over.
/ $0.357 to $7.14
.357 \
Over 7.14

12

24
(c)
b 24
&12 j-5 per cen t..........................

S tu ttg a rt.........

3

T reves...............

12

W e im a r ...........

6

.238

A n y amount.

12

15 per cent o f loan.........

W ie s b a d e n -----

12

.714

A n y amount.

12

3 per cent o f sale price..

W u rz b u rg ........

12

.476

A n y amount.

a Interest to be paid for at least three months.
b Interest to be paid for at least tw o months.

Other charges.

Per
cent.

a 12

5 per cent o f sale p rice ..

R egister fee and
renewal, each, 1
per cent o f loan.
A ppraisal fee, gold
and silver arti­
cles, $0,476 t o
$0,714, 2£ cents;
$0,952 to $11.66,
4|cents; $11 90to
$23.56, 9^ cents;
each additional
$23.80, 4| cents.

c F or first $7.14, 24 per cent; for remainder, 12
per cent.

Contrary to tlie rule in Holland and Belgium, neither the state nor
imperial law of Germany specifies what articles may be accepted in
pawn, thereby leaving the subject to the discretion of the municipalities.
In the main, personal property is taken, but the fact that some articles
are too bulky to be conveniently stored or are liable to damage, has led
the cities to make a few exceptions. In most cases, due to lack of capi­
tal, bonds, mortgages, and savings-bank accounts have been excluded,
yet such cities as Berlin, Dresden, and Munich receive a large number
of these securities each year. Miinchen-Gladbach, Halberstadt, and
Stralsund are peculiar in that they refuse to accept pledges from
private brokers or second-hand dealers, the idea being to hinder the
exploitation of the public pawnshop for the benefit of those who would
injure its work.
The inability of a single appraiser to successfully appraise all articles



PAWNBROKING IN EUROPE AND THE UNITED STATES.

201

has usually led to the appointment of at least two individuals for the
work; the one a practical jeweler who is present a portion of each day
to appraise articles offered in his line, the other an officer who remains
during office hours and receives and appraises all common articles.
The value of gold and silver articles is determined by weight; in the
case of other articles the appraiser uses his judgment as to what the
pledge would bring at public auction. The amount to be advanced on
the sums so determined varies in the several cities. Dresden ad vances
90 per cent of the face value of savings-bank accounts deposited with
it, 80 per cent on stocks, bonds, etc., the basis of estimate being the
bourse quotation for that day, 75 per cent on the gold and silver articles
and jewels, and 50 per cent on the value of other pledges. In Munich
66 per cent is advanced on stocks, bonds, etc., 88 per cent on savingsbank accounts, the amount to be given on other articles being left in
the hands of the appraiser. As a rule the regulations make the
appraisers responsible for losses incurred by sale of pledges, but in
point of fact the rule is not enforced unless it is clearly evident that
they have neglected to exercise proper care in their work. All advances
are, however, limited by the minimum loan, which varies from 0.50
mark ($0,119) to 3 marks ($0,714). A maximum advance is also fixed
in cities with a limited capital. Among these are Hanover and Hof,
where not over 1,000 marks ($238) will be advanced. In Baireuth 500
marks ($119) is the limit, while in Emden, Detmold, and Oppeln no
loan of over 300 marks ($71.40) will be made.
In general the pawn registers correspond very closely to that de­
scribed in the law of 1881. Crefeld and Weimar do not require that
the name of the pledger be given. In Darmstadt the name of the
owner is asked when articles of clothing are pledged; the same applies
in the case of stocks and bonds in Oarlsruhe, while in Munich and sev­
eral other cities no effort is made to secure the owner’s real name. In
Konigsberg and Frankfort on the Main, however, each applicant for
an advance must establish his identity before his pledge will be
accepted, while the officials of Cologne may require the same if they
think proper. A ticket must be given with each pledge, which as in
most continental countries is of a very comprehensive nature. Aside
from giving the date, number of the pledge, name of the owner, descrip­
tion of the pledge, and amount loaned, the date of the expiration of the
loan appears in a prominent place, while all regulations as to the
redeeming of the pledge, its renewal, sale, etc., are plainly printed on
some part of the ticket, the more important portion being placed in
bold-faced type to attract attention.
Varied as the interest rates given in the above table at first appear,
three general systems may be distinguished. In the first the same
rate is charged as on all loans without regard to the character of the
pawn or the amount of the loan; a second system bases its rate on the
kind of security given; while the third fixes the rate with reference to
the amount of the loan. The first plan is in use in 44 cities, of which
9986—No. 21--- -3



202

BULLETIN OF THE DEPARTMENT OF LABOR.

27, including Hamburg, Breslau, and Munich, charge 12 per cent per
annum; 4 of less importance 12£ per cent; with the remaining the
rate varies from 5 per cent in Detmold to 24 per cent per annum in
Munster. The second system is found in Berlin, Dresden, and Leipsic, those cities where stocks and bonds are accepted in pledge, which
being of such undoubted security it is safe to loan at a lower rate.
For advances secured by such collateral, Leipsic, Dresden, and Berlin
require but 6 per cent interest, while 8, 9, and 12 per cent, respectively,
are the rates on common pledges. Cassel makes advances on such
security at from 4 to 4£ per cent per annum. According to the third
plan, which is growing in favor, all pledges are held to be of like value
as security, and an attempt is alone made to secure the institution on
small loans, and yet not charge an exorbitant rate on larger ones. 'This
plan is used in over 30 cities, among which are Cologne, Halle, Carlsruhe,
and Dusseldorf. In cities of this class it will be noted that the same
rate is charged on all loans not exceeding a certain sum. In the case of
Constance the rate is 8 per cent on all sums of 200 marks ($47.60) or less
and 6 per cent on sums of 201 marks ($47.84) or over. In Cologne the
gradation begins at 15 marks ($3.57) and in Altona at 10 marks ($2.38).
By the law of 1881 for Prussia, which is now applicable to nine cities,
no charge other than for the sale of unredeemed pledges and the pay­
ment of the surplus may be made. In sixteen others no charge is made
if the pledge is redeemed prior to the expiration of the loan. An equal
number charge from § cent to 2J cents for the ticket, some of which
make a like charge if the loan is renewed. A fee for the appraisal is
collected in eleven of the cities mentioned in the table. Dusseldorf,
Crefeld, and Lubeck charge an appraisal fee varying with the amount;
while Mentz, Elberfeld, Gera, Schweinfurt, and Strasburg charge a
certain per cent or fee on the amount loaned. Of the charges made
prior to the expiration of the loan one other, the register fee (Einschreibegebilhr), remains to be mentioned. This charge, corresponding
very closely to the fee for appraisal, is, however, intended to cover the
expense of filing in the pawn register and making out the ticket. In
Darmstadt it is 2£ per cent of the loan, in Weimar but 1 per cent, while
Osnaburg has a graduated fee for sums of less than 100 marks ($23.80),
above which 1 per cent is charged.
In a few instances a fee which has the nature of a fine is levied if the
pledge is not redeemed prior to the expiration of the loan period but
before actual sale. In such instances Barmen charges 3 per cent of
the loan, Hanover 5 per cent on all sums up to 30 marks ($7.14) and
2 per cent on sums of over that amount, and Leipsic requires from J to J
per cent if redeemed within fifteen days after expiration of loan, § to
£ per cent if redeemed between sixteen and thirty days, and so on in
like ratio until date of sale, which can not occur for three months after
the expiration of the loan.
A charge demanded by all cities is a fee to cover the expense o f the
sale of unredeemed pledges. A plan gaining in popularity is to divide



PAWNBROKING IN EUROPE AND THE UNITED STATES.

203

the cost of the advertisement of the sale equally among the pledges
sold, and to apportion the actual cost of sale according to the proceeds.
But, because perhaps of the extra amount of work entailed in reckoning
two charges, the majority of the cities take a certain per cent of the
loan or proceeds of the sale. In Oarlsruhe and Fiirth 2 per cent of the
sale price is charged, while in Gera 10 per cent is taken. The latter
rate, however, is above the average, which may be said to be 5 per cent
of the sale price. In other places the idea obtains that a better distri­
bution of such cost may be secured by a gradation of charges. Frankfort
on the Main requires 5 per cent on all sums to 100 marks ($23.80) and
2 per cent for each additional mark ($0,238) above that amount. Halle,
besides a one-half cent fee to cover printing expenses, charges 5 per
cent on sums of less than 100 marks ($23.80), 3 per cent on sums from
100 to 300 marks ($23.80 to $71.40), after which the rate decreases to
one-half per cent on sums of 1,500 marks ($357) or more.
Finally a few cities make a small charge for the payment of surplus
claimed. In Dusseldorf this charge is 1£ cents, but in other places, as
Dresden, Elbing, and Fiirth, 5 per cent of the amount is claimed.
In that the cost of the auction is always borne by the pawner and
not the purchaser of the pledge, the surplus is the sum remaining after
the loan, interest, and charges, inclusive of auction and charge for pay­
ment of surplus, have been met. Without exception any such sums
are held subject to the claim of the owner, but in a few instances only
for a short time. Erfurt and Hildesheim appropriate any surplus
unclaimed at the expiration of fourteen days from the date of sale.
Halberstadt, Detmold, Dantzic, and Konigsberg hold sums of less than
30 marks ($7.14) for six weeks, and sums of over that amount a year.
But these are the minimum periods. In seven cities all sums are held for
six months $in forty-eight, for one year; four, for two years, and Coblentz,
Dusseldorf, Elberfeld, Strasburg, Weimar, and Wurzburg for three years.
The following table shows the number of articles pledged, redeemed,
and sold in the municipal pawn shops of 15 of the principal German
cities from 1891 to 1894:
A R T IC L E S P L E D G E D , R E D E E M E D , A N D SOLD I N M U N IC IP A L P A W N SHOPS, B Y
SE LE C TE D C IT IE S OF G E R M A N Y , 1891 TO 1894.
1891.

1892.

C ity
Pledged. Redeemed.
B e r lin .............................................................
H am burg.......................................................
L e ip s ic ...........................................................
M u n ich ...........................................................
B reslau...........................................................
D r e sd e n .........................................................
Cologne................................................... —
F rankfort on the M ain................................
H a n over.........................................................
K on ig sb erg....................................................
D usseldorf.....................................................
Chem nitz.......................................................
A lto n a .............................................................
E lb e rfeld ........................................................
S tr a s b u rg .....................................................




276, 978
64, 200
169, 885
476, 375
24, 702
154, 271
93, 356
101,801
22, 921
25, 884
69, 219
67, 338
162, 292
104, 052
55, 477

244,141
59, 201
151, 840
409, 644
22, 214
145, 608
86,121
90, 378
19, 865
20, 657
57, 269
61, 335
14, 681
85,979
49, 540

Sold.
13, 603
4, 369
17, 699
32,208
960
8, 821
7, 289
7, 510
2, 040
1. 296
8,524
5,133
941
7, 648
2,673

Pledged. Redeemed.
245, 472
65,061
194, 801
476, 494
22,653
151,153
77, 006
98, 387
16, 200
26, 340
69, 836
63,112
13, 599
102, 913
55, 299

248,776
61, 820
168, 542
435, 520
23,485
143, 954
78,441
95, 986
14,190
25,138
61,551
60, 825
13,732
97, 342
54, 212

Sold.
14,644
2, 705
15,133
48, 775
1, 096
8, 352
6,413
6, 952
2,010
1,202
7,948
4,635
975
8, 517
3, 235

204

BULLETIN OF THE DEPARTMENT OF LABOR.

A R T IC L E S PLE D G E D , R E D E E M E D , A N D SOLD I N M U N IC IP A L P A W N SHOPS, B Y
S E LE C TE D C IT IE S OF G E R M A N Y , 1891 TO 1894—Concluded.
1893.
City.
B e r lin .............................................................
H a m b u rg .......................................................
L e ip s ic ...........................................................
M u n ich ...........................................................
B reslau...........................................................
D re sd e n .......................... ..............................
C ologne...........................................................
F rankfort on the M a i n ..............................
H a n over.........................................................
K o n ig sb erg ....................................................
D u sseldorf.....................................................
Chem nitz........................................................
A lto n a .............................................................
E lb e rfe ld ........................................................
S tr a s b u rg ......................................................

Pledged. Redeemed.
219, 291
67, 563
187,285
466,581
19, 972
139,115
89, 992
100, 769
16, 978
23, 709
72, 546
60,516
16,988
110, 993
59,798

217,885
60,833
175,910
413, 017
19,763
136,460
79, 856
93, 604
14, 817
24,469
63, 377
56,761
14, 968
98, 282
54, 786

1894.
Sold.
14, 366
4, 888
16, 566
44, 676
1,180
7, 565
4, 819
5, 850
2,972
1, 328
8,454
3,587
718
9,117
2, 679

Pledged. Redeemed.
209,435
80, 276
180, 604
435,078
19, 385
138, 776
106,291
111,322
19,185
22,252
73, 527
72, 237
16, 363
96,333
60, 750

201,295
70, 964
168, 639
393, 644
18, 545
131,851
90,463
99,033
17,967
22,121
62, 300
64, 812
15, 289
90, 275
56,990

Sold.
11,878
3,698
15,679
42,51G
925
7, 059
6, 286
5,697
1, 903
1,168
9, 987
4, 398
1,052
12, 281
3,225

That the wide variation in the number of articles pawned in the sev­
eral cities may be noted, the cities mentioned in the above table have
been arranged in the order of their size. Although Berlin has four and
a half times the population of Munich, the number of articles pledged in
the city is not half as many. Again, the number of articles pledged
in Munich is more than twice the number pledged in Leipsic, although
the difference in population is very slight. In Berlin the number is
decreased by the presence of private brokers, but not so in Leipsic,
nor are the private brokers of Berlin sufficiently thrifty to entirely
account for the difference, which is perhaps due to the better financial
condition of the residents of the latter city. A like variation may be
seen in several other cities, as Konigsberg and Dusseldorf, the popula­
tion of the former being but 7,000 greater than the latter, yet the busi­
ness of the latter is more than three times that of the former. In like
manner with Hanover and Frankfort on the Main, where the difference
in population is 36,000, the number of pledges in the latter is nearly
six times as many as in the former. No well-defined tendency may be
noted as to the decrease or increase in the number of articles pawned
in the several cities.
The average loans on articles pledged, redeemed, and sold in the
municipal pawn shops of 15 of the principal cities of Germany are
shown for the years 1891 to 1894 in the following table:
A V E R A G E LO A N S ON A R T IC L E S P L E D G E D , R E D E E M E D , A N D SOLD IN M U N IC IP A L
P A W N SHOPS, B Y S E LE C TE D C IT IE S OF G E R M A N Y , 1891 TO 1894.
1891.
City.
B e r lin .............................................................
H a m b u rg........................................................
L e ip s ic ...........................................................
M u n ich ...........................................................
B resla u ...........................................................
D r e sd e n .........................................................
C ologne...........................................................
F rankfort on the M a i n ..............................
H a n o v e r. .1..................................................
Kouigshfvrg
D u sseldorf......................................................
C hem nitz........................................................
A lto n a .............................................................
E lb e rfe ld ........................................................
Strasburg........................................................




Pledged. Redeemed.
$4.79
5.25
3.09
1.97
5.00
3.36
1.81
1.86
2.41
2.47
1.44
1.79
1.66
1.00
2.08

$4.99
5.19
3.21
2.00
5. 30
3.45
1.97
1.89
2.40
2.44
1.43
1.82
1.68
1.04
2.03

1892.
Sold.
$3.97
2.71
1.86
1.71
5. 30
2.69
1.49
1.72
3. 53
2.07
1.43
1.84
1.39
1.27
2.78

Pledged. Redeemed.
$4. 97
5.45
2.93
1. 97
4. 97
4. 09
1.87
1.81
2.48
2.45
1.45
1.83
1.72
1.40
1.96

$2. 88
5. 37
3.14
2.01
4. 94
3.98
1.81
1.81
1.92
2.45
1.44
1.83
1.72
1.11
1.99

Sold.
$3. 68
5.17
1.90
1.64
4.94
2.61
1.51
1.61
2.35
2.40
1.44
1. 73
1. 58
.89
2.55

PAWNBROKING IN EUROPE AND THE UNITED STATES.

205

A V E R A G E LO A N S ON A R T IC L E S PL E D G E D , R E D E E M E D , A N D SOLD I N M U N IC IP A L
P A W N SHOPS, B Y S E LE C TED C IT IE S OF G E R M A N Y , 1891 TO 1894—Concluded.
1893.
City.

B e r lin .............................................................
H am burg.......................................................
L e ip s ic ...........................................................
M u n ich ...........................................................
B reslau...........................................................
D resd en .........................................................
Cologne...........................................................
Frankfort on the M a in ..............................
H anover.........................................................
K on ig sb erg....................................................
D usseldorf.....................................................
C hem nitz.......................................................
A lton a .............................................................
E lb e rfeld .......................................................
S tra sb u rg......................................................

Pledged. Redeemed.
$5. 24
4. 76
2. 98
2.01
5. 30
4.51
1.83
1.80
2.89
2.43
1.44
1. 84
1.55
3.16
1.93

$5.21
5.28
3.05
2.02
5.17
4.41
1.87
1.81
3.63
2.43
1.43
1.84
1. 58
1.14
1.95

1894.
Sold.
$3. 59
3.89
1. 73
1. 61
3. 79
2. 92
1.62
1.63
1.19
2. 24
1.44
1.75
1.54
1.09
2.41

Pledged. Redeemed.
$5.10
4.14
3.20
2.06
5.27
5.06
1.75
1.80
2.87
2.41
1.44
1.71
1.61
1.09
1. 96

$5. 21
4.48
3. 28
2.09
5. 48
5. 02
1.06
1.81
3.10
2.42
1.45
1. 74
1.61
1.12
1. 87

Sold.
$3.91
3.40
1.70
1.68
3.49
3.14
1.49
1.61
1.70
2. 06
1.45
1.87
1.39
1.26
2.08

In the main the minimum loan seems to have little effect in fixing
the average advance. In Berlin, with 2 marks ($0,476) as the smallest
advance, the average in 1891 was 20.13 marks ($4.79), while Hamburg,
with a minimum of 1 mark ($0,238), made an average advance of
22.07 marks ($5.25), the highest average loan made by any city
of Germany in that year. In those cities doing a large amount of
business in proportion to the population, the loan is small, the average
in Munich in 1894 being 8.67 marks ($2.06), as against 13.45 marks
($3.20) in Leipsic. In like manner the loan in Frankfort on the
Main was 7.57 marks ($1.80), while that of Hanover was 12.07 marks
($2.87). The average for those pledged, as well as redeemed, is,
however, a little below that given in the table, in that the renewed
pledges appear in both items, and, being of greater value than the
others, naturally tend to raise the average as given. For this reason
any statement as to the class of articles sold is subject to error, yet
their average is so much below that of those pledged or redeemed that
the renewals are unable to account for the difference, and we are left
to the conclusion that those pawning articles of small value experience
greater difficulty in redeeming them than the owners of pledges of
greater value. The tendency in the larger cities during the last five
years has been for the average loan to increase. In Berlin the advance
has been slight, but in Dresden particularly marked, the average loan
on pledges rising from 14.12 marks ($3.36) in 1891 to 21.26 marks ($5.06)
in 1894, while in Leipsic and Munich the increase has been slight; but
in the smaller cities, with the exception of Dusseldorf and Elberfeld, a
decrease has occurred. If, however, a longer period be considered, it
will usually be found that the average loan has materially decreased.
For example, in 1876 the average loan in Frankfort on the Main was
15.50 marks ($3.69), but in 1894 it was only 7.56 marks ($1.80), and
many other cities show a similar decline. The explanation of this is
that the quality of the clothing offered in pledge has continually dete­
riorated, while the fall in the price of silver has led not only to a lower
valuation of many articles of jewelry, but caused a great increase in



206

BULLETIN OF THE DEPARTMENT OF LABOR.

the amount of cheap jewelry and the number of articles of a low value
held by the public. Finally, this general decline has caused several
cities to lower the amount of their minimum advance, so as to avoid
the refusal of a large number of articles offered in pledge, which has
also had its influence on the average loan.
The per cent of articles redeemed, renewed, and sold in the pawn
shops of 15 of the principal cities of Germany is shown for the years
1891 to 1894 in the following table:
P E B C E N T OF A R T IC L E S R E D E E M E D , R E N E W E D , A N D SOLD I N M U N IC IP A L P A W N
SHOPS, B Y S E LE C TE D C IT IE S OF G E R M A N Y , 1891 TO 1894.
1891.

1892.

City.
Redeemed.

B erlin.............................. .
H a m b u r g ........................
L e ip sic..............................
M u n ic h ............................
B re s la u ............................
D resd en............................
C olog n e............................
F rankfort on the M ain.
H a n o v e r ..........................
K o n ig s b e r g ....................
D u s s e ld o r f.....................
Chemnitz ........................
A lt o n a ..............................
E lb erfeld ..........................
S tra sb u rg........................

a 94. 72
73.12
«89. 56
73.80
a 95. 86
61.76
79.59
84. 85
a 90. 69
a 94.10
80. 79
a 92. 28
83.19
a 91.83
71.30

Renewed.

(&)
20.01
(b)
17.67
(&)
32. 53
12. 61
7.48
<&)
(&)
6.25
(b)
10.79
(b)
'
23. 58

Sold.

5.28
6. 87
10.44
8. 53
4.14
5.71
7.80
7.67
9.31
5.90
12.96
7.72
6.02
8.17
5.12

Renewed.

a 94. 44
75. 53
a 91. 76
67. 92
a 95.54
61.88
78. 95
85. 59
62.42
a 95. 44
82. 49
a 92. 92
79.67
a 91.95
71. 67

(6)
20.28
(6)
22.01
(b)
32. 64
13.49
7. 66
25.17
(&)
6.07
(&)
13. 70
(&)
22.71

1893.
City.

B e r lin ..............................
H am burg........................
L e ip s ic ............................
M u n ich ............................
B reslau............................
D r e sd e n ..........................
C o lo g n e ..........................
F rankfort on the M ain.
H a n ov er..........................
K o n ig sb e rg ....................
D u s s e ld o r f....................
C hem nitz........................
A lto n a ................. ............
E lb e rfe ld ........................
S tr a s b u rg ......................

R e­
deemed. Renewed.
a 93. 81
80.43
a 91.39
67.39
a 94.37
61. 86
82. 36
86.42
34. 67
83. 39
79. 58
a 94. 06
83.62
a. 91.51
73. 96

a Inclu din g renewed.

(b)
12.13
(b)
22. 84
(&)
32. 88
11. 95
7. 70
48. 63
11.46
8. 65
(&)
11. 81
(b)
21. 38

Sold.

Redeemed.

Corrected
auction per
cent.

5. 56
4.19
8. 24
10. 07
4.46
5.48
7.56
6.75
12. 41
4. 56
11.44
7. 08
6.63
8. 05
5.62

5.41
4.24
8.91
9.99
4.59
5.43
6.88
6.95
11.78
4.85
10.39
6.93
5. 98

1894.
jCorrected
R e­
Sold.
auction
Renewed.
per cent. deemed.

Sold.

6.19
7. 44
8.61
9. 77
5. 63
5. 26
5.69
5.88
16. 70
5.15
11.77
5.94
4. 57
8.49
4.66

5.57
4.95
8. 51
9.75
4.76
5.08
6.48
5.44
9.58
5.01
13. 82
6. 35
6.44
11.97
5. 35

5.51
8.50
9.58
5.21
5.12
6. 72
5.78
5.44
12.11
5. 84
5. 28
4. 84

a 94.43
80. 47
a91.49
67. 05
a 95. 24
62.89
82.22
86. 72
56. 96
82. 54
77. 63
a 93. 65
80. 27
a 88.03
72.81

(&)
14. 58
(b)
23.20
(&)
32.03
11. 30
7.84
33.46
12. 45
8.55
(&)
13. 29
(b)
21.84

Corrected
auction
per cent.
5.16
8. 37
9.60
4. 63
5.15
7. 30
5. 81

7.23
6.19
5. 39

&Included in redeemed.

O f the cities in which the articles redeemed are reported separately
from the renewals, Frankfort on the Main ranks first in the per cent
redeemed and lowest in the per cent of renewals. But its 86.72 per
cent of redemptions in 1894 is closely followed by Konigsberg, Cologne,
and Hamburg, with 82.54, 82.22, and 80.47 per cent, respectively ; Han­
over being the lowest, with but 56.96 per cent of its pledges redeemed
and 33.46 per cent of them renewed. The highest per cent of sales was
in Dusseldorf, where 13.82 per cent of the pledges leaving the pawn
shop were sold, while Breslau is lowest, with 4.76 per cent, followed
very closely by Hamburg. These per cents are a little above the real



207

PAWNBROKING IN EUROPE AND THE UNITED STATES.

sales, in that the base used is the total number of articles on hand
during the year, which includes a large number of renewals from the
previous year.. To secure an accurate per cent the base should be the
number of articles pledged and auction per cent be calculated when
the articles pledged, in say one year, had been disposed of either by
redemption or sale. By this method Breslau in 1894 had the lowest
per cent of sales, 4.63, and Munich the highest, 9.60.
The following table shows the per cent of articles of various kinds
pledged in Dresden and Berlin in 1894 and 1895:
P E R CEN T OF A R T IC L E S P L E D G E D IN' D R E SD E N A N D B E R L IN , B Y C LASS OF
A R T IC L E S , 1894 A N D 1895.
Dresden.

Berlin.
Per cent o f arti­
cles pledged.

Per cent o f arti­
cles on hand.
Class o f articles.

Class o f articles.
1894.

1895.

Jewels, gold and silver a rtic le s...
W atches and c l o c k s ........................
W oolen and linen goods and
c lo t h in g ..........................................
Silk goods and cloth in g...................
B e d d in g ..............................................
F u r garm ents.....................................
Other articles.....................................

14.79
16.81

14. 76
16. 92

52.81
.81
9.76
1.48
4.04

52. 05
.74
9. 78
1. 54
4. 26

Total .......................... ............

100. 00

100.00

Jan. 20, Jan. 19,
1894.
1895.
G old and silver articles...............
Ornaments and je w e ls .................
W atches and c l o c k s ....................
Clothing and m erchandise.........
Stock, bonds, e t c ............................

46. 61
3. 25
17. 99
32. 08
.07

47. 52
3. 53
17.44
31.44
.07

T o t a l .....................................

100. 00

100.00

While in the above classification the facts for the two cities are not
entirely analogous, a comparison is possible. In both cities the clocks
and watches make up from 16 to 17 per cent of all pledges, but here
the similarity ceases. In 1895 jewelry in Dresden formed but 14.76
per cent, while in Berlin the gold and silver articles alone make up
47.52 per cent of the total, and, added to the ornaments and jewels,
constituted 51.05 per cent of the total. The place occupied by jewelry
in Berlin is taken by clothing in Dresden, 54.33 per cent falling directly
in that list, as against less than 31.44 per cent in Berlin.
The following table shows the average daily number of articles pledged
and redeemed in Berlin and Dresden during the year 1895, and at dif­
ferent periods during the year:
A V E R A G E D A I L Y N U M B E R OF A R T IC L E S P L E D G E D A N D R E D E E M E D I N DR E SD EN
A N D B E R L IN , 1895.
Dresden.
Period.
Pledged.
Year ending December 31,1895 .....................................................
W eek en d in g:
January 1,1895 ............................................................................
A p ril 1,1895 .................................................................................
J u ly 1,1895 ...................................................................................
October 1,1895 .............................................................................
Easter, 1895...................................................................................
Whitsuntide, 1895........................................................................
Christmas, 1895 ...........................................................................




Berlin.

R e­
deemed.

Pledged.

R e­
deemed.

442

447

686

660

680
601
695
545
598
482
502

435
468
460
496
583
644
589

895
870
695
681
629
766
657

834
689
727
785
684
915
794

208

BULLETIN OF THE DEPARTMENT OF LABOR.

To ascertain wliat influences tend to increase the number of articles
offered in pawn, the reports of Berlin and Dresden give data for the
above table. In both cities the average daily number of articles
pledged during the week when rents were due, as also during Easter,
Whitsuntide, and Christmas, is in most cases above the daily average
for the year. It is noticeable that the number pledged before holidays
is less than when rents are due, in fact, the daily average of articles
pledged in Berlin during Easter and Christmas weeks is below the
average for the year and for the other periods shown, but the redemp­
tions during the holidays rise much higher above the average than
those pledged in the same period. A variation is noticeable during
the week. The greatest amount of business is done on Monday and
Saturday, with this difference, that the articles are pledged on Mondays
and redeemed on Saturdays.
The amount and sources of capital of the public pawn shops of 14
of the principal cities of Germany in 1890 are shown in the following
table:
A M O U N T A N D SOURCES OF C A P I T A L OF M U N IC IP A L P A W N SHOPS, B Y S E L E C T E D
C IT IE S OF G E R M A N Y , 1890.

City.

A m ount borrow ed from —
Capital
belonging to A uthorities
Private
the institu­ to w hich the
Savings
persons or
institution
hank.
tion.
associa­
belongs.
tions.

B e r lin ............. ..................... $866, 537.01
110,984.64
H am burg
............... .........L e i p s i c .................................. 104, 239.67
523, 057.02
M u n ich ..................................
B reslau..................................
134, 314. 82
D r e sd e n ...............................
4, 723. 59
C ologne...................................
F rankfort on the M a in ___
H a n ov er.................................
6, 708. 60
D u sseldorf..................
C hem nitz........................ . . . .
38, 884. 44
5,317.12
A lto n a .....................................
1, 711. 54
E lb e r fe ld ...............................
S tr a s b u rg ..............................
15,862.95

$130,996.39
103,412.00
31,936.80

$144, 942.66
135, 660. 00
59,926. 00
102, 340. 00
103, 292. 00

96,507.33
2,856. 00

$59,877.47

26, 787.85
63, 802. 00
16, 422. 00
6,320.33
49, 314. 79
19,992. 35

Total
capital.

$997, 533.40
214, 396. 64
249,181.67
750, 531. 29
59, 926. 00
236,654.82
108, 015. 59
123, 295.18
2, 856.00
70, 510. 60
55, 306. 44
11, 637.45
51, 026. 33
35,855. 30

A m ount
loaned
on each
$100 o f
capital.
$125. 20
173.30
212.80
281.31
204. 99
116.82
172.91
182. 65
243.17
201. 65
203.94
140.40

The application of the profits and unclaimed surplus to the forma­
tion o f a reserve fund, together with funds donated to them by their
founders, has given several of the public pawn shops a considerable
capital of their own. Chemnitz owns 70 per cent of the money used in
the business, and Dresden and Hamburg over 50 per cent of theirs.
But these are the highest amounts, the other cities being obliged to
obtain additional funds, either from the municipality, the savings bank,
or private parties or companies. In Berlin the Boyal Commercial Com­
pany supplies the funds, while Hamburg, Munich, Frankfort on the
Maiu, and Hanover are supplied by their respective cities. The more
popular plan, however, is for the savings banks to furnish the needed
money. This method obtains in at least twenty-one cities of Germany,
in three of which, Erfurt, Posen, and Gorlitz, the entire capital is fur­
nished in this way. In Dusseldorf the pawn shop has unlimited
credit with the savings bank, but in Breslau its credit is limited to



PAWNBROKING IN EUROPE AND THE UNITED STATES.

209

75.000 marks ($17,850). Munich uses all these sources, borrowing
570.000 marks ($135,660) from the savings bank and 251,586 marks
($59,877.47) from other sources. In Strasburg and Mentz the plan
often followed in France and Belgium is used. The officials of the
institution are required to deposit certain sums as security for loss that
their negligence may entail, the funds so obtained being used in the
business.
An interesting portion of the table is that which gives the amount
loaned during the year on each $100 of capital. Because of the fact that
the majority of the loans are paid prior to the expiration of the loan
period, a greater sum may be loaned than the capital would indicate.
It would seem that places with a short loan period would be able to
turn their capital more frequently than those with a longer one. This,
however, is not the case. The loan period in Munich is a year and that
of Leipsic six months, yet the former advanced $281.31 and the latter
only $212.80 on each $100 of capital. Again, the loan period of Elberfeld and Strasburg is the same, yet their advances were $203.94 and
$140.40, respectively, showing that the loans of Elberfeld were repaid
more promptly than those of Strasburg.
The following table shows the percentage of the total income, repre­
sented by each item of the account for the public pawn shops of 13 of
the principal cities of Germany, 1891 and 1892:
P E R CEN T OF E A C H IT E M OF IN COM E OF T O T A L IN CO M E OF M U N IC IP A L P A W N
SHOPS, B Y SE LE C TE D C ITIE S OF G E K M A N Y , 1891 A N D 1892.
1891.

City.

H am burg......... ..
L eipsic .................
M u nich...................
B reslau...................
D re sd en .................
C o lo g n e .................
F rankfort on the
Main
...............
H anover.................
T T b n ig s b P irg _ ___
D u s s e ld o r f...........
Chem nitz...............
Alt.oufl,
E lb e rfeld ...............

1892.

In ter­
ter­
In ter­
est
U n­ M iscel­ Inest
Fees claimed
from
est
laneous from
and
from capital
sur­
re­
ad­
ad­ deposit­ charges. plus. ceipts.
vances.
vances. ed and
rent.
88. 22
72. 26
68.42
95. 92
74. 84
94. 59
86. 60
69. 20
93. 47
74. 26
79.10
88. 91
66. 72

11.43
.52
.04
8.10
5. 70
3. 63
.97

4.98
18. 74
17. 20
19.19
1.61
7. 50
1. 53
14. 36
14.70
20. 56

6. 80
6. 78
2.83
3.42
5. 74
3.04
4.30
17. 50
1.37
9. 74
5. 50
6.77
12.72

2. 22
.12
. 14
.19
.76
1.00
.10
.67
.70
4. 32

91.40
72. 92
66.61
95.13
75.35
95. 01
79. 29
71.41
92. 04
75.51
83.54
88.42

In ter­
est
U n ­ M iscel­
from
Fees
laneous
capital
and claimed
sur­
re­
deposit­ charges.
plus. ceipts.
ed and
rent.

14.15
.50

2. 71
17.96
16. 66
18.97
1.97

13.82
3.11
2.00
.93

6. 65
1.74
13.62
14.80

5. 89
6. 80
2.25
4.22
5.49
2. 72

2.32
.33
.35
.19
.30

6. 09
18. 72
4. 15
9. 53
.43
6.97

.80
.11
.07
.41
1. 23
4.61

The interest received on advances in Cologne forms a larger per cent
of the total income than in other cities. In 1892, 95.01 per cent of all
moneys received by it was from this source, 1.97 per cent from fees
and charges, 2.72 per cent from unclaimed surplus, and 0.30 per cent
from miscellaneous sources. Because of the small loans granted, the
smallest proportional amount of interest on advances was received in
Munich, 66.61 per cent, but the fees and charges, not being dependent on
the length of loan, rise to 16.66 per cent, while the capital deposited with



210

BULLETIN OF THE DEPARTMENT OF LABOR.

the banks, not being needed in the business, returned 14.15 per cent of
the total income. The largest relative amount of surplus was received
by Hanover, almost one-fifth of its total income being from this source.
Dusseldorf ranks next highest, with 9.53 per cent, after which follow
Altona and Leipsic, with 6.97 and 6.80 per cent, respectively.
The per cent of each item of expenditure is shown for the years 1891
and 1892 in the following table:
P E R C E N T OF E A C H IT E M OF E X P E N D IT U R E OF T O T A L E X P E N D IT U R E OF M U N IC I­
P A L P A W N SHOPS, B Y SELE C TED C IT IE S OF G E R M A N Y , 1891 A N D 1892.
1891.
City.

H a m b u r g ...........
L e ip sic.................
M u n ic h ............... .
B re s la u .................
D resden...............
C o lo g n e ................
F rankfort on the
M a in .................
H a n o v e r .............
K o n ig s b e r g .........
D u ss e ld o r f...........
C h e m n itz .............
A lt o n a ..................
E lb erfeld............. .

In ter­
In ter­
Misest on Loss on W ages Build­
est on Loss on W ages B uild­ M is­
and
cellane
and
cellane­
bor­
sale o f
ing and
bor­
sale o f
ing and
pen­
ous
e
x
­
rowed pledges.
rowed pledges. pen­ repairs. ous e x ­
repairs,
sions.
penses.
penses.
sions.
capital.
capital.

17.82
16.38
33.72
18.10
35.14
25.61
28. 98
21. 68
12. 90
12. 63

2. 73
9.38

77.16
55.81
57. 73
52.06
26. 93

* 1.07
1.26
4. 82
.63
7. 61

53. 38
42.94
81.72
62. 07
68. 08
47. 62
69.16

20.11
. 01

2. 53
5. 63

73.30
24. 80
8. 55
26. 74
37. 93

19.48
22.12
32.92
19.81
30. 27

18.61
26. 82
10. 93
10. 62
18. 39
32.14
30. 84

28. 62
22.10
.80
19. 83
10. 38
11.21

3.80
4. 79

75.18

1.82

1.43
59. 78
50. 32
47. 00

44.63
.20
.01
.03

1.84
44. 63
82. 03
57. 62
70. 37
67.43

18. 99

1.56
1.43
2.51
2. 09
2. 63

4. 20
4.81

21.02
75.73
31. 82
7.10
28. 04
22. 70
48. 99
31.84
10. 46
17. 74
17.16
18. 73

The expenditure for interest on borrowed capital as given in the
above table does not vary directly with the amount borrowed, since
other expenditures, as well as the rate of interest paid, modifies the per
cent this item forms of the total. In Breslau 32.92 per cent of the total
expenditure in 1892 was for interest, while in Konigsberg but 0.8 per
cent of the total was for this purpose.
The income and expenditure per article pledged, and the per cent of
the same of the amount loaned, are shown for 14 selected cities for the
years 1890 to 1892 in the following table:
IN CO M E A N D E X P E N D IT U R E P E R A R T IC L E P L E D G E D A T M U N IC IP A L P A W N SHOPS
A N D P E R C EN T OF IN C O M E A N D E X P E N D IT U R E OF A M O U N T L O A N E D , B Y
S E L E C T E D C IT IE S OF G E R M A N Y , 1890 TO 1892.

City.

Incom e per article
pledged.
1890.

1891.

E xpenditure per
article p ledged.

1892. 1890. 1891.

Percent o f income P ercent o f expend­
o f amount loaned. iture ol amount
loaned.

1892. 1890. 1891.

1892.

1890.

1891.

H am burg............................ $0.66 $0.74 $0. 75 $0. 43 $0.45 $0.45 14.55 14.10 13. 20 9. 71 8. 50
.30
.31
.30
.30
.28 14.46 11.25 11. 27 11. 08 11.01
L e ip s ic ................................ .31
.40
.42
.34 18. 43 19.17 20.89 17. 05 15.45
.44
.37
.34
M u n ich ................................
.35 12. 66 12. 44 13.71 11.49 11.17
.68
.65
.58
.63
B reslau................................
.38
.40
.43
.45
.40 11.97 11.91 11. 61 11.29 11.12
.40
D r e sd e n ..............................
.37
.29 19. 87 21. 53 22.13 12. 29 12. 61
.43
.47
.26
.24
C o lo g n e ..............................
.48
.40
.35
.41 18. 86 17.15 10. 38 16.47 17.18
.37
.41
.37
F rankfort on the Main ..
.40
.33
.46
.45
.43
.47 17. 36 18.12 16.53 18. 32 19. 00.
H anover..............................
.29
.35
.31
.29
.26
.24 13.32 12. 00 12.10 10. 74 10. 24
K o n ig s b e r g .....................
.26
.26
.26
.19
.19
.21 16. 80 16. 54 16. 20 12.72 11.80
D u s s e ld o r f........................
.36
.26
.33
.28
.27 16. 92 18.30 19.01 13. 93 13. 60
.28
Chem nitz............................
.46
.52
.36
.47
.31
.37 25. 30 24. 93 27.43 19. 98 16. 56
A lt o n a ................................
.26 18. 57 17. 95 16.83 15.45 17. 36
.29
.29
.27
.25
.27
N urem berg........................
.34
.35
.33
.35 25.37 ,25. 96 25.14 24.07 24. 33
.37
H a lle .................................... .35




1892.
8.28
10.65
15. 55
11.19
10. 33
13. 48
19. 09
16.97
9.65
12. 79
13.86
16. 69
15.62
25. 32

211

PAWNBROKING IN EUROPE AND THE UNITED STATES.

The average loan in Hamburg being higher than in other cities, and
charging, as it does, 12 per cent per annum, interest being payable for
at least one month, gave it an average income of 3.15 marks ($0.75)
per article in 1892, and this with the loan period of but six months.
Breslau, with the same loan period, stood next, while Leipsic, where
advances are also made for six months, received but 1.26 marks ($0.30)
per pawn. In the latter, however, the low rate of interest accounts
for the small income. In this connection it may be explained that the
low rate of interest in Leipsic is made jiossible and the small expen­
diture per pawn results not alone from the clause of the law permitting
the profits of the business to supplement the reserve fund, but also
that its pawn shop occupies the same building as the city savings bank.
In this way the same officers may administer both, while many of the
helpers may assist in both institutions; but, aside from this, the savings
bank bears three-fifths of the general expenses. Moreover, Leipsic
pays the savings bank but 3J per cent interest, while Dresden, Han­
over, Dusseldorf, Altona, and Chemnitz pay 4 per cent and Cologne
5 per cent per annum on similar funds. The interest paid, however,
will not always account for the expenditure. Hamburg, which receives
its capital from the city and pays no interest, still had an expenditure
of 1.89 marks ($0.45) per pawn in 1892, while Dusseldorf, where the
expenditure was the least, 0.88 mark ($0.21), pays, as above stated, 4
per cent interest.
The following table gives the profits of the pawn business in 15
selected cities for the years 1891 and 1892:
P R O F IT S OF T H E BUSINESS OF M U N IC IP A L P A W N SHOPS, B Y SEL E C T ED C IT IE S OF
G E R M A N Y , 1891 A N D 1892.
Profits for—
City,.
1891.

H a m b u rg.............................................................................................................................
L e ip s ic .................................................................................................................................
M u n ich .................................................................................................................................
B resla u ................................................................................................................................
D r e sd en ...............................................................................................................................
C ologne.................................................................................................................................
Frankfort on the M a in .........................................................................................
H a n ov er...............................................................................................................................
K on ig sb erg.........................................................................................................................
D u sseldorf............... ...........................................................................................................
C hem nitz.............................................................................................................................
A lto n a ..................................................................................................................................
E lb e rfe ld .............................................................................................................................
S tra s b u rg ...........................................................................................................................

$19,107. 35
9, 498. 58
586. 39
10, 560. 52
4,246.17
2, 551.83
8, 450. 28
2, 987.14
901.78
2, 549. 69
2, 376.43
808. 25

1892.
$16, 447. 23
7,607.19
1,519. 87
6, 226. 08
4, 621. 69
2, 340. 59
7, 510. 80
2, 048. 33
a l , 062. 67
1, 345.18
1, 878. 77
2,172. 22
725.42

rtLoss.

After all expenses have been met and the unclaimed surplus added
to the income of the respective cities, the resulting profit is that given
above. From a financial standpoint the business is not a success; the
profits made would not pay a respectable dividend on the capital
invested. It must, however, be remembered that it is the constant
endeavor of the officials to lower the rate of interest and charges to an
amount that will cause the income to exactly balance the expenditure.



212

BULLETIN OF THE DEPARTMENT OF LABOR.

Difficult as this is to do, a fair degree of success has been obtained.
In 1892 the profit in Altona was only 3,048 marks ($725.42), that of
Konigsberg 5,652 marks ($1,345.18), and Leipsic 6,386 marks ($1,519.87).
Hanover suffered a loss of 4,465 marks ($1,062.67), while the following
cities not mentioned in the table had a deficit at the end of the year:
Mentz, Darmstadt Metz, Essen, Mannheim, Dortmund, Halle, Crefeld,
and Nuremberg.
In the disposition of the profits a distinction is usually made between
unclaimed surplus and profits arising from the business. In Berlin both
surplus and profits are given to some charity specified by the city
authorities, but in the following cities the unclaimed surplus becomes
the property of the poor fund, the other profits either going to the city
or to form a reserve fund: Breslau, Cologne, Hanover, Altona, Elberfeld, Dantzic, Barmen, Halle, DortmundJ Essen, Erfurt, Kiel, and Gorlitz. In Elberfeld and Barmen, however, the officials of the institution
receive 10 per cent of the profits of the business. According to the
rules for Leipsic, Munich, Dortmund, Altona, and Gorlitz, the profits
go to form a reserve fund until that fund has reached a certain amount,
after which the sums belong to the poor fund or are paid into the city
treasury. Nuremberg, Duisburg, and Carlsruhe give the profits to the
city, while in Chemnitz one-half of the profits remaining, after the
appraiser has received 1J per cent of the sum, is paid into the treasury,
the remaining one-half forming a reserve. Lastly, in Dresden, Konigsberg, Strasburg, Brunswick, Mentz, Cassel, Posen, and Metz the entire
profits, inclusive of the surplus, belong to the institution itself.
FRANCE.
Although the early efforts of the kings of France to control the tak­
ing of property in pledge were singularly ineffective, the Government
as such made no attempt to adopt the Italian plan until 1614. In that
' year, due, perhaps, to the visionary scheme proposed by Hughes Desletre three years previous, the States General adopted a plan which,
but for the nonconcurrence of the Third Estate, would doubtless have
been placed in operation. Ten years later the same idea was embodied
in an edict of the King providing for the establishment of monts-depi6te in the cities of France. But as Richelieu refused to take the
necessary steps to put the plan in operation, it seemed probable that
the effort of the King was not sincere and that the step was taken for
purely political reasons. The law of 1643, however, seems to have
been the product of an honest desire to place the business in the hands
of the municipal authorities; but, lacking confidence in the ministry,
the cities gave no heed to the statute.
Its failure led to the law of 1673, which sought to control the private
broker by requiring that all pawn contracts should be made in the
presence of a notary public. But by this method the charges were so



PAWNBROKING IN EUROPE AND THE UNITED STATES.

213

excessive that a legitimate trade was impossible, and the worst forms
of an uncontrolled business prevailed. Yet this condition did not
obtain in all parts of France. In a few instances the desire of the
cities to further their commerce and contribute to the welfare of their
citizens had induced them to follow the example of their neighbors in
Belgium and Italy and establish pawn shops under municipal control.
Moreover, Avignon and Garpentras had preceded rather than followed
the efforts of Belgium, the former having begun operations in 1577 and
the latter in 1612. Likewise Nancy may in part claim priority, having
founded a mont-de pUt6 in 1615, whose work, however, was unsatis­
factory until reorganized according to the plan adopted in Brussels.
In other cities monts-de-piet6 were founded as follows: Aix, 1635; Apt,
1674; Tarascon, 1676; Brignoles, 1677; Montpellier and Angers, 1684;
Marseilles, 1695.
The ill-advised legislation of 1673 was allowed to stand until the eve
of the Bevolution, when Louis X Y I realized that the demands of the
people required attention, and hastened to establish a royal lottery, a
lottery for the poor (lotterie deplete), and promulgated a plan for found­
ing a mont-de-piete in Paris and the principal cities of the Kingdom.
The decree, given at Versailles December 9, 1777, contained little that
was new. In the main it was simply a restatement of the principles
then in successful operation in Belgium and Italy, and which regulate
the business in continental Europe to-day. Under such conditions its
immediate success is not surprising. From the first the chief concern
in Paris was to secure a capital sufficient to meet the demands upon
its resources. According to the original plan the public charities (hopital general) of that city were to supply the funds, but the amount they
could furnish was quite insufficient, and it was necessary to resort to
loans. So obvious were its beneficial effects that even Necker com­
mended its work, and the writers of the period speak of it as dealing a
mortal blow to the “ fierce and barbarous fury of the voracious usurers.”
Yet with all its success neither the institution in Paris nor those in
other cities were able to withstand the drastic measures of the revolu­
tionary period, which, by robbing them of their capital and refusing
legal protection, worked their downfall.
The rise of interest rates noted* in Belgium under similar conditions
was now experienced in France, and within less than a year the demand
was so general that a reorganization was determined upon. This time
no monopoly of the business was given and no reference made as to the
rate of interest to be charged on advances, the idea being to allow the
institution to prove its worth by direct competition with the vast num­
ber of private brokers that had begun loaning during its inactivity.
In this it was successful. The rate of interest in Paris, at first 30 per
cent per annum, was soon lowered to 18, a step which so increased its
popularity as to lead to the law of 1804 (16 Plumose, X I I ), which
restored it the monopoly enjoyed prior to the Bevolution. But, given



214

BULLETIN OF THE DEPARTMENT OF LABOR.

this advantage, it was deemed unwise to permit the cities complete
control, and a law of the same year {24 Messidor, X I I ) provided a plan
of reorganization which placed their administration subject to the cen­
tral authorities. Under this law the work of reorganization went rap­
idly forward, not alone in France, but in Italy and those provinces taken
from Belgium by Napoleon. After the restoration the work was con­
tinued in like manner, and before 1840 forty-four monts-de-piete had
been reorganized, while but five retained their former organization.
P R E SE N T L A W S OF F R A N C E .

Within the departments, by the law of 1804, the reorganization of
the monts-de-piete, as well as the founding of new institutions, was left
largely in the hands of the prefects. As the suggestions of the minister
of the interior were not binding, each institution was at liberty to adopt
such rules of administration and prescribe such conditions for advances,
etc., as best suited their convenience, subject alone to the sanction of
the central authorities. Thus a great diversity in organization resulted.
By the provisions of the law of 1851 monts-de-piete may be established
only with the consent of the municipal council and by a decree of the
President of the.Bepublic. Within the department the administration
is given into the hands of a council of administration, which receives
no compensation for its services. Members of this council are to be
appointed by the prefect, and comprise the mayor (as president), three
members of the municipal council, three administrators of the public
charities, and an equal number of the citizens of the commune. The
immediate charge is given to a director, appointed by the prefect upon
the recommendation of the council. The prefect, however, is at liberty
to accept or reject the nomination of the council or remove the director
after his appointment.
In Paris, according to the decree of 1852, made to meet the require­
ments of the law of the previous year, the administration is placed
under the authority of the prefect of the Seine and the minister of the
interior. The immediate administration is by a director, who is himself
under the control of a committee of “ surveillance/7comprised of the
prefect of the Seine (as president), the prefect of the police, three mem­
bers of the municipal council, three members of the ‘ ‘ assistance publique,” and an equal number of the citizens of Paris. The members of
this committee, with the exception of the two prefects, are appointed by
the minister of the interior from a triple list presented by the prefect of
the Seine. Its members, with the exception of the two prefects, as the
corresponding committee in the department, with the further exception
of the presiding officer, are renewed by thirds every two years.
It is stipulated that the capital of the several monts-de-pi£te shall
consist of such funds as may have been given them at the time of their
foundation; any gifts or legacies of which they have since been the
recipient; of such a portion of the profit or unclaimed surplus (boni) as
the by-laws of each institution shall stipulate, and any funds the State



PAWNBROKING IN EUROPE AND THE UNITED STATES.

215

or commune may place at its disposal. If by this method sufficient
capital is not attained, loans may be made or funds accepted in deposit,
in accordance with the rules annually approved by the minister of the
interior. It is further provided that, in case an institution obtains
a capital of its own sufficient to cover general expenses, and lower
the rate of interest to the legal rate of 5 per cent, any excess of the
receipts will, by a decree of the prefect, and with the approval of the
municipal council, be given to the hospitals or to other charitable
institutions.
A significant portion of the law, as will be seen later, was that which
attempted to curb the abuse arising from the sale of pawn tickets. It
stipulates that the owner of a pledge, three months after the date of
pledging, may cause the sale of his pawn, and receive any surplus
remaining after loan, interest, and charges have been paid, but new
merchandise under no consideration may be sold prior to the expiration
of the loan period.
Since its enactment the above general law has been supplemented by
two important measures. The first, passed in 1865, gives another illus­
tration of the French desire for unity, and, at least from a statistical
standpoint, is a most commendable measure. From the date of its
founding each mont-de-pie te had been allowed to follow the system of
bookkeeping that best suited its purposes. This permitted such a
diversity as to render it quite impossible to make a comparison of the
results such as would enable the central authorities to intelligently
exercise the powers given by the law of 1851. In order to make this
desired comparison possible the authorities decided to introduce a uni­
form system of bookkeeping similar to that in use by the other char­
itable institutions of France. To this end a committee was appointed
whose report, afterwards embodied in the law, described minutely a
model system of bookkeeping to which each mont-de-piete was, as
nearly as possible, to conform. The second measure, passed July 25,
1891, is clearly the result of the economic development of recent times.
For several years prior to its enactment it had been noted that laboring
classes were in the habit of investing their savings in securities of dif­
ferent kinds, but no definite idea of the extent or nature of the invest­
ment was obtained until the refunding of the loan of the city of Paris
in 1888. A t that time it was found that over 27 per cent of the city
bonds were held by those who had purchased them fractionally, and
that of these investments but 42.5 per cent were sufficiently large to
obtain an advance upon the same from the Bank of France. It was
further known that many were compelled, on account of sickness or
enforced idleness, to sell these investments of their savings at a sacri­
fice to secure needed funds. To give this class of investors or others
holding like securities an opportunity to obtain small advances at
reasonable rates, without being obliged to part with their savings, it
was enacted in 1891 that the mont-de piete of Paris, as well as those
of other cities, upon making special application for the privilege, should



216

BULLETIN OF THE DEPARTMENT OF LABOR.

be permitted to make advances on certain securities, as bonds, mort­
gages , etc.
From the revolutionary period to the present the pawn business of
France has been under the direct control of the State and municipal
authorities. Moreover, the provisions common to the laws upon the
subject, declaring that all institutions for the loaning of money upon
pledges shall be conducted to the profit of the poor and requiring the
sanction of the Government for the founding of a new institution,
have effectually excluded private enterprise and given the municipality
a monopoly of the business. Yet in no instance are the municipal
authorities allowed to establish a pawnshop, or mont-de-piet6, without
the consent of the municipal council of the city and a decree of the
President of the Eepublic giving certain more definite provisions as to
its administration than are found in the general laws.
M O N T -D E -P IE T E O F P A R IS .

Aside from the general provisions as to the appointment of the
administrative bodies already described, the law of 1851 gives no
further direction as to administration, but the law for Paris enacted
the following year directs that the prefect shall call a meeting o f the
council at least once a month, and on such other occasions as he may
think proper. As a matter of fact, however, this is given into the
hands of the director, who calls the meetings in the name of the pre­
fect. Although the convening of the council may seem to be somewhat
frequent for members who are allowed no compensation for their serv­
ices, yet it is none too often for the amount of business placed in its
hands. Aside from such general matters as may come up in reference
to the property and business of the institution, it must pass upon all
budgets and accounts ; decide as to new buildings and repairs, or the
demolition of the old ones; act as to the acceptance of gifts or legacies
for the institution, and also act in reference to legal matters. It must,
moreover, fix the rate of interest on money borrowed or loaned, and
make rules as to the manner in which the business shall be conducted
by its employees.
The work of the mont-de-pi6te of Paris is carried on at a central
office, three supplementary offices, and twenty-two auxiliary offices,
distributed over the various parts of the city. The central and supple­
mentary offices have storehouses attached to them for the goods
pawned, and are open every weekday from 9 a. m. to 3 p. m. On Sun­
days no articles may be taken in pawn, but they are open until 12 for
redemptions. The auxiliary offices are usually open from 9 a. m. to 8
p. m., and pledges received during the day are at once conveyed to the
central office for safe-keeping until redeemed.
The officer to whom the administration of the institution is given is
the director appointed by the minister of the interior from the triple
list of candidates furnished him by the prefect of the Seine. His work




PAWNBROKERG IN EUROPE AND THE UNITED STATES.

217

is purely administrative, the chief duty assigned him being to see that
the rules and regulations laid down by the minister of the interior, the
prefect of the department, or the council of surveillance are properly
carried out. He has the appointment of all the minor officers and
helpers (hommes de service) of the institution, all other officials being
appointed by the prefect of the Seine from a triple list of candidates
supplied him by the director. He must take cognizance of all errors
or lack of discipline, on the part of the personnel, and is authorized
to carry out such disciplinary measures as the rules of the administra­
tion permit. At the close of each year he is required to make out a
trial budget and submit it, together with a general report of the entire
work of the year, to the council. If approved by them, both report
and budget are submitted to the prefect of the Seine, and by him to
the minister of the interior for his approval. Aside from the director
there is a general secretary who acts in case of the director’s absence;
a treasurer, who has charge of all the receipts and expenditures of the
institution; an inspector of the branch offices (bureaux auxiliares), and
such other officials as are necessary to superintend and control the
several departments which naturally arise from the needs of the busi­
ness. In all instances the chiefs of these departments must furnish
bonds and are held strictly responsible for losses arising from their
own negligence, and in many instances from that of their employees.
Daily reports are required from each, by means of which any error in
the work may be readily detected.
For the officers and helpers appointed by the director an educational
qualification is required. To this end the candidates must pass an
examination in the French language, orthography, and arithmetic; but
before being permitted to take the examination each must present his
certificate of birth, as no one of less than 20 years of age or more than
35 may become a candidate for an assistant secretaryship, while candi­
dates for general helpers must be at least 18 and not over 35 years of
age. Further, prior to the examination each applicant must secure
a certificate from the regular physician of the institution, certifying to
his physical ability to perform the work required of him. Finally,
each must present statements signed by the proper judicial authorities,
to the effect that he has never been convicted of misdemeanors and
that he has satisfied the requirements of the military authorities.
After this all candidates successful in the examination are received on
a three months’ probationary period, at the end of which time those
are discharged who, from inability to do the work, lack of discipline,
or other causes, have not proved themselves .capable.
Aside from these regular employees there is a special advisory com­
mittee (comite consultatif), composed of lawyers, whom the authorities
may consult on all legal matters, and who, together with the regular
notary, execute all legal documents for the institution and rejnesent
it in all cases of equity.
9986—No, 21----- 4



218

BULLETIN OF THE DEPARTMENT OF LABOR.

A regular physician is also employed who, aside from examining all
applicants for clerkship or the helpers and assistants, as above men­
tioned, acts as general medical attendant for all the employees of the
institution. By this means the employees are furnished with free
medical service, yet the object in so doing was not entirely humani­
tarian. It was found that some of the salaried employees often reported
themselves unfit for duty on the most trivial causes. To avoid the
loss thus entailed a physician was employed who reports daily the
names of those unable to be at their post, all others absent unless
officially excused being liable to discipline.
The remaining set of officials, which we will discuss more thoroughly
later, are the so called appraisers (eommissaires priseurs), whose duty
it is to determine the value of all articles submitted to the institution
for an advance of money.
The several laws enacted by the Government give a very imperfect
idea of the articles accepted in pledge by the monts-de-piete of France
or Paris. The earlier laws alone mentioned personal property (effets
mobilieres), exclusive of stocks, bonds, etc., but made no further limita­
tion. Some insisted that this did not include new merchandise, and a
considerable discussion arose, which continued until 1857, when the law
of that year declared it subject to pawn. After this no further additions
were made to the list until 1891, when the mont-de-piete of Paris was
authorized to receive stocks, bonds, etc., and provisions made whereby
other cities could obtain a like concession. Under these provisions
almost anything, with the exception of real estate, may be received, yet
each institution, because of the character of the articles or a lack of
room for storage, refuses to accept certain pledges in pawn. In Paris
the following are refused: Military accouterments, uniforms, decora­
tions of the Legion of Honor, articles bearing stamp of a public insti­
tution, firearms, damp or untidy clothing, photographs or engravings
of an obscene nature, fur garments or those lined with fur, and goods
cut out but not yet manufactured into articles of apparel.
I f an article not prohibited by the above list is presented, the appli­
cant is given a check, a duplicate of which is attached to the article
itself. This method has been adopted to avoid publicity during the
transaction. After this the attendant who has received the pawn car­
ries it to the appraiser, who estimates its value, thereby fixing the sum
to be advanced. For gold and silver articles the value is determined
by weight, the amount advanced being four-fifths of what the crude
metal would bring in the market. With other articles, such as clothing,
furniture, etc., the appraiser must rely on his own judgment as to the
amount they would bring at auction, and two-thirds of that amount
may be advanced. In the case of bonds, stocks, mortgages, etc., no
loan of over 500 francs ($96.50) may be made at one time to a single
borrower. All advances are based upon the official quotation of the
bourse for that day in the following proportions: Eighty per cent on




PAWNBROKING IN EUROPE AND THE UNITED STATES.

2 l9

French securities, treasury obligations, and bonds of the mont de-piete;
75 per cent on such bonds bearing a yearly interest as shall be desig­
nated by the director with the approval of the prefect and the council
of administration; 80 per cent of the value on certain other certificates
of stock (actions de jouissance). But if, during the continuance of
the loan, the stocks or bonds on which the advances have been made
fall 15 per cent below the bourse quotation at the date of making the
advance, the owners of the same are required to make an additional
deposit to cover the deficit thereby created.
The amount to be advanced having been determined, the applicant’s
number is called and the attendant announces the sum the appraiser
is willing to loan on the pledge. If satisfactory to the owner of the
pledge, a check is made out. If not, the pawn is at once returned.
But before an advance is actually made, if the sum be for 16 francs
($3.09) or over, papers of identity must be produced. Women and
children, to secure this amount, must not only present papers of iden­
tity, but also produce a certificate showing their full right to pawn the
article, while soldiers must be accompanied by a noncommissioned
officer of their company. Regular customers, however, may have their
names registered and be relieved of the trouble of proving their iden­
tity oftener than once a year. When, however, it is necessary to
establish one’s identity, it may be done by producing any one of the
following list of articles: Registry certificate; bill payable to order;
lease; registered letter; certificate of membership in a society or club;
railway pass; card permitting entry to a museum; student’s card issued
by a university or college; credentials issued by the mayor of a city,
the police authorities, or a consul; certificate of a public employee;
college diploma; papers issued by the military authorities; letters of
credit; naturalization papers; laborer’s permit or a permit to hunt, or
bear arms; passport; deed; pension certificate; receipt for payment of
water or gas bill, or fire or life insurance.
Having established his identity by one of the above papers, the
pledger signs a certificate of deposit and receives in return a ticket,
together with the amount advanced. The ticket gives the number of
supplementary office or letter designating an auxiliary office, the num­
ber of the pawn, date, amount loaned, description of the articles
pledged, the estimated value, its weight (if an article of gold or silver),
and the signatures of two officials. Besides this, the ticket has printed
upon it the law as to the length of loans, as also full particulars as to
charges, redemption, renewal, and payment of surplus, in case of sale
by auction. If, however, the authorities have reason to believe that
the object presented has been stolen, or is lost property, or if the appli­
cant is unable to establish his identity, they may suspend the loan until
the police have been consulted or the proper proof furnished. Mean­
while the pawn is held under the title of “ suspended loans,” but if
after eight days the proper proof has not been furnished, it is classed




220

BULLETIN OF THE DEPARTMENT OF LABOR.

with miscellaneous deposits and held for the final call of the legitimate
owner.
To redeem an article it is only necessary to present the pawn ticket
and pay the amount of loan, together with accrued interest and charges.
These payments, however, may be made by installments of any amount
the debtor may be able to advance, or in a lump sum. Care is taken
by the officials to ascertain if the ticket is one reported lost, in which
case the bearer must first establish his right to the property before he
is permitted to redeem it. If, however, the pledge has been in deposit
for a year and the owner does not desire to, or is unable to redeem his
property, he may have the loan renewed by paying the charges and
interest. Renewals virtually consist of two operations, the redemption
of the pawn and its repledging immediately thereafter, the only dif­
ference being that in some cases a reappraisal of articles is not neces­
sary. The rules as to just what articles shall be reappraised are very
indefinite, the matter being left largely to the discretion of the apprais­
ers, who are responsible for any loss resulting from the sale of unre­
deemed pledges. Yet certain classes of goods are always subject to
reappraisal; among these are shawls (chales) and woolen goods, on
which a loan of over 50 francs ($9.65) has been granted, and all pawns
on which over 100 francs ($19.30) have been advanced, as also all kinds
of bedding.
The rate of interest charged has been greatly reduced in the last
decade. From 1831 to 1886 an interest of 9 per cent per annum was
charged, with a fixed appraisal fee of ^ per cent on the amount loaned.
In 1886 the rate was lowered to 8 per cent per annum, and the J per
cent appraisal fee retained, but the following year the interest was fur­
ther reduced to 6 per cent per annum, with a fixed charge o f 1 per cent
on the sum loaned, which rate obtains at present. On stocks, bonds,
and mortgages (valeurs mobilieres), however, the rate is 6 per cent per
annum, with a fixed charge of J per cent on the sum loaned. But on
loans of 5 francs ($0.97) or less no charge whatsoever is made if the
pawn be redeemed within two months. In all cases interest must be
paid for fourteen days, that period having been made the basis for
reckoning interest in Paris, instead of the month, as is the case in
many places.
In case of sale, the purchaser of the article must pay 5 per cent of
the purchase price to cover the expense of sale. Formerly this fee was
3 per cent, but at the time the mont-de-pi6t6 reduced its rate of interest
the treasury in which the surplus funds of the institution were placed
also lowered the rate paid on deposits. In this way the receipts were
reduced to such an extent that it was deemed wise to add 2 per cent
to the auction fee, in order to cover in part the loss.
Pawns not redeemed or renewed at the expiration of a year from the
date of pledging or last renewal are subject to sale at public auction to
meet the demand of the loan, plus interest and charges. A t least ten




I^AWNBROKING IN EUROPE AND THE UNITED STATES.

221

days prior to sale posters giving date and place of sale, as also a gen­
eral description of the articles offered, must be posted in public places.
In case a pledge on which 16 francs ($3.09) have been advanced is to be
offered for sale, a notice informing the owner of the fact is sent to his
address prior to the public announcement of the auction. In all cases
the sales are conducted by the appraiser, who may recall each article
twice if it does not bring the desired amount. Otherwise an article
offered is sold to the highest bidder, no restriction being placed on the
bids save that when the sum of 20 francs ($3.86) has been offered no
bid of less than 50 centimes (10 cents) will be accepted. In all cases
the purchaser must pay the expense of sale. If, however, from any
cause he refuses to take the article after bidding it in, it is at once
offered for sale again, the former purchaser being responsible for any
loss incurred by the second sale.
Any sum remaining from the sale of an unredeemed pledge after
loan, interest, and charges are paid is held subject to the demand of
the rightful owner. Sums arising from the sale of common pledges
are held for three years, but where stocks or bonds have been sold the
owner, upon presentation of his ticket any time within ten years, may
secure the surplus due him. If, however, such funds are not claimed
within the specified time they become the property of the institution
and are ultimately paid by it to the poor fund (hospices civils) of Paris.
WORK

O F T H E M O N T S -D E -P IE T E O F F R A N C E A N D P A R I S
TRASTED.

CON­

In the four tables following, which are placed together for purposes
of comparison, are shown the number of articles pledged and renewed
and the total and average loans on such articles. The first two tables
give figures for the whole of France for the years 1881 to 1892; the
figures in the other tables are for Paris for the years 1880 to 1895.
N U M B E R A N D P E R C E N T OF A R T IC L E S P L E D G E D A N D R E N E W E D A T T H E M ONTSD E -P I ^ T ^ OF F R A N C E , 1881 TO 1892.
Pledged.
Y ear.

1881
1882
1888
1884
1885
1886
1887
1888
1889
1890
1891
1892




Renewed.

A rticles.

Per cent
o f total.

A rticles.

P er cent
o f total.

2, 994,606
3,110,145
3,274, 933
3, 261,190
3,108, 883
3,102, 038
3,134, 963
3,187, 828
3,185,422
3,422,989
3,301, 827
3,323, 526

73.18
74. 58
74. 79
73.30
70. 85
70.94
70. 94
70.21
69.64
70. 51
69. 75
69. 79

1, 097, 757
1, 059, 963
1,103, 617
1,187. 784
1,278,871
1,270,926
1, 283, 922
1, 352, 340
1, 388, 887
1,431,485
1,431, 752
1,438, 955

26. 82
25.42
25. 21
26.70
29.15
29. 06
29. 06
29.79
30.36
29.49
30.25
30. 21

Total
articles.

4,092,363
4,170,108
4, 378, 550
4,448, 974
4, 387, 754
4, 372, 964
4, 418,885
4, 540,168
4, 574, 309
4, 854, 474
4,733, 579
4, 762, 481

222

BULLETIN OF THE DEPARTMENT OF LABOR.

T O T A L A N D A V E R A G E L O A N S ON A R T IC L E S P L E D G E D A N D R E N E W E D A T T H E
m o n t s -d e -p h 2t i 5 o f F r a n c e , i88i t o i892.
Pledged.
Year.

A m ount o f
loans.

1881............... $10,895, 735. 87
1882...............
12, 048, 093.13
12,112,823. 79
1888...............
1884...............
12, 041,325. 58
1885...............
11, 603, 438. 31
1886........... ..
11, 903, 625. 29
11, 732, 089. 98
1887...............
1888...............
11, 605, 643.14
1889...............
11,557,532.48
1890...............
12, 385, 699.15
1891...............
12,283,116. 37
1892...............
13,789, 307.28

Renewed.

Total.

P er
cent o f
total.

A v e r­
age
loan.

A m ount o f
loans.

Per
cent o f
total.

A v e r­
age
loan.

A m ou nt o f
loans.

68.25
70. 32
69. 20
67. 24
64. 74
66. 23
64. 72
63.13
62. 23
62.95
63.07
65.40

$3.64
3.88
3.70
3.69
3.73
3.84
3.74
3. 64
3. 63
3.62
3. 72
4.15

$5, 069, 858.91
5,085,927.12
5,391, 389. 38
5, 866,495. 36
6, 319, 437. 60
6,069, 486.97
6, 396.344.05
6, 778,183. 74
7, 015,159. 95
7, 290, 385.47
7,190, 849. 58
7, 294,458.35

31.75
29. 68
30.80
32. 76
35.26
33.77
35.28
36. 87
37. 77
37.05
36. 93
34.60

$4.62
4.80
4.89
4.94
4.94
4.78
4. 98
5.01
5.05
5. 09
5.02
5.07

$15,965, 594.78
17, 134,020.25
17,504,213.17
17,907, 820. 94
17,922, 875.91
17, 973,112.26
18,128, 434. 03
18,383,826.88
18, 572, 692.43
19, 676, 084. 62
19, 473, 965.95
21,083,765. 63

A v e r­
age
loan.
$3. 90
4.11
4. 00
4.03
4. 08
4.11
4.10
4.05
4. 06
4. 05
4.11
4.43

N U M B E R A N D P E R C E N T OF A R T IC L E S P L E D G E D A N D R E N E W E D A T T H E M ONTD E -P I ^ T ^ OF P A R IS , 1880 TO 1895.
Pledged.
Year.

1880...............................................................................
1881...............................................................................
1882...............................................................................
1883...............................................................................
1884...............................................................................
1885...............................................................................
1886...............................................................................
1887...............................................................................
1888...............................................................................
1889...............................................................................
1890................................................................................
1891...............................................................................
1892...............................................................................
1893...............................................................................
1894...............................................................................
1895...............................................................................

j.

Renewed.

A rticles.

P er cent
o f total.

Articles.

P er cent
o f total.

1, 682, 522
1, 598,018
1, 669, 582
1,777, 395
1, 692,902
1, 487,908
1,409, 370
1, 434,681
1,469,961
1,444, 955
1,491,540
1,463, 345
1,447, 725
1,330, 478
1, 251, 801
1,142,801

69.63
69.43
71.53
72. 21
69. 58
65.05
64. 32
64. 73
64.15
63. 64
64. 73
63. 80
63.60
61.69
61.16
59. 26

733,806
703, 708
664,617
684,165
740, 256
799,551
781, 940
781, 604
821,382
825, 537
812, 832
830,445
828,424
826, 216
795,079
785, 541

30.37
30.57
28.47
27.79
30.42
34. 95
35. 68
35. 27
35. 85
36. 36
35. 27
36.20
36.40
38. 31
38. 84
40.74

Total
articles.

2,416, 328
2, 301, 726
2, 334,199
2,461,560
2, 433,158
2, 287,459
2,191,310
2, 216,285
2,291,343
2, 270, 492
2, 304,372
2, 293, 790
2, 276,149
2,156, 694
2, 046,880
1,928, 342

T O T A L A N D A V E R A G E LO A N S ON A R T IC L E S P L E D G E D A N D R E N E W E D A T T H E
M O N T-D E -Pl^TIt: OF P A R IS , 1880 TO 1895.
Pledged.
Y ear.

1880...............
1881...............
1882...............
1883...............
1884...............
1885...............
1886...............
1887...............
1888...............
1889...............
1890...............
1891...............
1892...............
1893...............
1894...............
1895...............

Renewed.

Total.

A m ount o f
loans.

Per
cent o f
total.

A v e r­
age
loan.

A m ount o f
loans.

Per
cent o f
total.

A v e r­
age
loan.

A m ount o f
loans.

$6,800,428.92
6, 899,988.16
7, 814, 674.22
7, 767, 646.49
7, 304, 233. 22
6, 521, 848.47
6, 485,483.22
6, 501,729.19
6,477,816. 68
6, 566, 051. 07
6,789,382.95
7,055, 508.14
7. 258, 659.94
6,764,291. 21
5,904, 035. 21
5,666, 072.58

66.96
67. 56
70.53
69. 41
66. 23
61.14
61. 32
60. 80
59.12
59.31
60. 63
60. 87
61.89
60.50
56.82
56.26

$4.04
4. 32
4. 68
4. 37
4. 31
4. 38
4.60
4. 53
4.41
4.54
4. 55
4.82
5.01
5.08
4. 72
4.96

$3, 355,085.75
3, 313,163.07
3, 264,941. 82
3, 422,741. 32
3, 724, 937.83
4,145, 404.93
4, 091, 225. 39
4,192, 238. 69
4,478, 899. 08
4, 504, 766. 68
4, 408, 360.09
4, 535, 851. 65
4,469,162. 04
4,416, 764. 66
4,486, 530.11
4,405,894. 90

33.04
32.44
29.47
30.59
33.77
38. 86
38. 68
39. 20
40. 88
40. 69
39. 37
39.13
38.11
39. 50
43.18
43.74

$4. 57
4.71
4. 91
5.00
5. 03
5.18
5. 23
5. 36
5.45
5. 46
5.42
5.46
5.39
5. 35
5.64
5.61

$10,155,514. 67
10, 213,151.23
11,079, 616. 04
11,190, 387. 81
11,029,171. 05
10, 667,253. 40
10,576, 708. 61
10, 693, 967.88
10, 956, 715.76
11, 070, 817.75
11,197, 743. 04
11, 591, 359. 79
11,727, 821.98
11,181,055.87
10, 390, 565.32
10,071,967.48

A v e r­
age
loan.
$4.20
4.44
4. 75
4. 55
4. 53
4.66
4.83
4. 83
4.78
4. 88
4. 86
5.05
5.15
5.18
5.08
5.22

In the tables for Paris the year 1880 has been chosen as a starting
point, as it illustrates the business under normal conditions, the crisis



PAWNBROKING IN EUROPE AND THE UNITED STATES.

223

of 1881 not Raving as yet made itself felt. It should, however, be noted
that prior to this the average value of articles pledged had shown a
very slight tendency to increase from year to year, but nothing like the
advance occurring between 1880 and 1881, as also between 1881 and
1882. This marked increase is clearly the effect of the financial crisis,
which caused the wealthier class of people to pawn their goods. That
this is true is shown by a critical examination of the pledges pawned
in 1881. During the first ten days of February the average value of
the articles pledged was 22.19 francs ($1.28), but by the 1st of Novem­
ber the average had risen to 23.23 francs ($4.18), and the number of
pledges on which the sum of 1,000 francs ($193) had been loaned almost
doubled. In 1883 a change occurred; the number of pawns is seen to
have increased while the sum loaned decreased, so that the average
value drops back to what in the future must be considered as normal.
A point worthy of notice is the decreased number of pledges in 1881
and 1885, which is explained in the reports of the director as due to
the fact that the period of depression in Paris had driven a large num­
ber of laborers into the country, he having arrived at this conclusion
by noting that over one-half of the applications for renewal and redemp­
tion came from the country districts. In this connection it is interest­
ing to refer to the average loan made on articles pledged in France.
Throughout the entire country the increase in 1882 was 1.22 francs
($0.21), with a decrease of 0.91 francs ($0.18) the following year, but in
Paris there was an increase of 1.13 francs ($0.28) in 1881 and 1.88
francs ($0.36) in 1882, and a decrease of 1.61 francs ($0.31) in 1883.
Moreover, the slight increase in the country districts is more marked
when it is remembered that Paris does over one-half the pawn busi­
ness of the country, and this increase naturally raises the average value
of the other portions of France. The entire showing serves to illustrate
the financial nature of the crisis, which affected Paris far more than
the outlying districts.
Returning to the number of articles pledged in France, and the
average loan on the same, a word may be added as to the probable
causes of the fluctuation in the number of pledges received from year
to year and the slight increase in the average loan made. Where the
variation in the number of pawns received is large, as between 1882
and 1883, changed economic conditions, in this case the return of
better times, may be assigned; where, however, the change is slight,
as between 1885 and 1886, it is customary to attribute it to the low
valuation placed upon articles by the appraisers, which causes the
owners of the pledges to refuse to accept a loan, or the appraisers to
refuse to advance the minimum sum of 3 francs ($0.58) on the articles
offered. The point is well illustrated by the experience of Paris in
1892. In that year 101,338 articles were offered in pawn on which the
appraisers refused to advance 3 francs ($0.58), while 10,511 would-be
pawners refused to accept the loan offered them on their pledges. This
has had a tendency to call for better pledges and thereby increase the



224

BULLETIN OF THE DEPARTMENT OE LABOR.

average loan. Yet the increase would have been greater had the price
of silver remained the same. From 1878 to 1885 advances on silver
articles were made at the rate of 140 francs per kilogram ($12.26 per
pound), but in October of that year it was reduced to 130 francs per
kilogram ($11.38 per pound), and in August, 1886, to 110 francs per kilo­
gram ($9.63 per pound).
From the totals given in the table for France we find that the several
monts-de-piete of the country advanced, including renewals, 82,723,289
francs ($15,965,594.78) to their patrons in 1881, and that by 1892 the
advances amounted to 109,242,309 francs ($21,083,765.64), a sum suffi­
cient, had it been equally distributed among the inhabitants of the
country, to have loaned each individual 2.85 francs ($0.55). Yet this
figure is insignificant when compared with that of Paris, whose loan
of 60,765,917 francs ($11,727,821.98) in 1892 was sufficient to have
advanced 24.82 francs ($4.79) to each man, woman, and child of the city.
In Paris the per cent of the articles renewed of the total number
received increased from 30.57 per cent in 1881 to 36.40 in 1892, and for
the entire country there was an increase from 26.82 to 30.21 per cent.
The per cent which the renewals form of the total loan in Paris has
increased from 32.44 in 1881 to 38.11 in 1892, while that of France has
increased from 31.75 to 34.60 per cent. In that about one-half of the
total business of the country is done in Paris this indicates that the
increase of renewals has been but slight in the remaining cities.
The following table shows for Paris, for the other cities of France,
and for the whole of France the number of articles pawned per 100
inhabitants for the years 1875 to 1892:
A R T IC L E S P A W N E D IN P A R IS A N D IN F R A N C E P E R 100 IN H A B IT A N T S , 1875 TO 1892.
1875. 1876.

1877.

1878. 1879.

1880.

1881.

1882.

1883.

P a ris................................. - .................................... 85.6
Other c i t i e s .................. , ...................................... 48.6

89.5
50.8

90.0
52.2

81.7
49.8

87.2
55.0

76.1
48.3

71.3
47.5

74.5
48.0

79.2
50.9

62.9

67.1

68.1

63.6

65.9

60.3

57.5

59.7

62.8

1884.

1885.

1886.

1887.

1888.

1889.

1890.

1891.

74.5
53.2

65.7
54.8

61.5
52.5

61.9
52.9

64.6
53.0

61.6
53.3

64.2
60.1

63.6
63.5
57.1 i 56.9

T ota l............................................................. 62.5

59.5

56.4

56.8

57.6

57.5

61.9

60.0

T otal.............................................................

P a ris........................................................................
Other c i t i e s ...........................................................

!

1

1892.

59.7

A better basis of comparison than the amount loaned per inhabitant
is furnished by the number of articles pawned by a given number of
persons in Paris and in the other cities of the country, since in this
way those living in the outlying districts are not included. By this
method we find that in 1875 85.6 articles were pawned by every 100
inhabitants of Paris and 48.6 by a like number of persons in other
cities. From that period on the number varies, but in the later years
100 of the inhabitants of Paris pawn from four to seven more articles
than a like number in other cities.



225

PAWNBROKING IN EUROPE AND THE UNITED STATES.

In the four tables following are shown separately for France and for
Paris the number and per cent of articles redeemed, renewed, and sold
at the monts-de-piete, and the total and average loans on such articles.
The figures for France are for the years 1881 to 1892; for Paris the
figures cover the years 1880 to 1895.
N U M B E R A N D P E R C E N T OF A R T IC L E S R E D E E M E D , R E N E W E D , A N D SOLD A T TH E
M O N T S -D E -P I£ t £ OF F R A N C E , 1881 TO 1892.
Redeemed.
Year.

1881.......................................
1882.......................................
1883.......................................
1884.......................................
1885.......................................
1886......................................
1887.......................................
1888.......................................
1889.......................................
1890.......................................
1891.......................................
1892.......................................

Renewed.

A rticles.

Per cent
o f total.

2,776,130
2,711,056
2,709,432
2,634, 081
2, 558, 250
2, 772, 016
2, 772,167
2, 803,970
2,841,404
2,937, 809
2, 891,053
2,924,768

66.15
66.18
65. 27
62. 80
59. 40
61. 74
62. 79
62.45
62.41
62.33
61. 61
61.18

Sold.

A rticles.

Per cent
o f total.

A rticles.

P er cent
o f total.

1, 097, 757
1,059,963
1,103, 617
1,187, 784
1,278,871
1,270, 926
1, 283, 922
1, 352,340
1, 388,887
1,431,485
1, 431,752
1,438, 955

26.16
25. 87
26.58
28. 32
29. 69
28. 31
29. 08
30.12
30. 51
30.37
30. 51
30.10

322, 994
325, 508
338, 293
372, 329
469, 803
446, 555
359, 074
333, 773
322,116
343, 822
369, 679
416, 563

7. 69
7. 95
8.15
8. 88
.10. 91
9. 95
8.13
7.43
7. 08
7. 30
7. 88
8. 72

Total.

4,196, 881
4,096, 527
4,151, 342
4,194,194
4, 306, 924
4,489, 497
4,415,163
4, 490, 083
4, 552,407
4, 713,116
4, 692.484
4, 780, 286

T O T A L A N D A V E R A G E L O A N S ON A R T IC L E S R ED E E M E D , R E N E W E D , A N D SOLD A T
T H E M O N T S -D E -P l£ T £ OF F R A N C E , 1881 TO 1892.
Redeemed.
Year.

1881..
1882..
1883..
1884..
1885..
1886..
1887..
1888..
1889..
1890 .
1891..
1892..

Sold.

R enewed.

Total.

Per A v e r­
Per A v e r­
Per A v e r­
A m ount o f
A m ount o f cent
age A m ount o f cent
age A m ount o f cent
age
loans.
loans.
of
o
f
of
loans.
loans.
loan.
loan.
loan.
total.
total.
total.
$
9, 991, 587. 61
10, 041, 357. 29
10, 278, 420.16
9, 726, 734. 87
9,531,194. 80
10,766, 715.18
10, 531,386. 22
10,443, 048. 39
10, 635, 098. 83
10,853, 838.85
10, 619, 892. 36
11,590,169. 36

60. 51
60.53
59. 70
56. 66
53. 56
57.45
56. 83
55.86
55. 92
55. 51
55. 28
56. 57

$
$
3.60 5, 069,858. 91
3. 70 5, 085, 927.12
3.79 5, 391, 389.38
3. 69 5, 866, 495. 36
3.73 6, 319,437.60
3.88 6. 069,486.97
3. 80 6, 396,344.05
3. 72 6, 778,183. 74
3. 74 7, 015,159. 95
3.69 7, 290,385. 47
3. 67 7,190, 849. 58
3.96 7,294,458.35

30. 70
30. 66
31. 32
34.17
35. 51
32.39
34. 52
36.25
36.89
37. 28
37.43
35. 61

A v e r­
age
loan.

$
$
$
$
$
4. 62 1, 451, 611. 09 8. 79 4.49 16, 513, 057. 61 3. 93
4. 80 1, 461, 313. 98 8. 81 4. 49 16, 588, 598. 39 4.05
4.89 1, 546, 327. 39 8. 98 4.57 17, 216,136. 93 4.15
4. 94 1, 573,678. 58 9.17 4. 23 17,166, 908. 81
4. 09
4. 94! 1, 945,129. 27 10. 93 4.14 17, 795, 761. 67 4.13
4. 78 1, 904, 799.41 10.16 4. 27 18, 741, 001. 56 4.17
4. 98 1, 603,185.28 8. 65 4. 46 18, 530, 915. 65 4. 20
5.01 1,475,618.94 7. 89 4. 42 18, 696, 851. 07 4.16
5.05 1, 367, 615.76 7.19 4.25 19, 017, 874.54 4.18
5.09 1,409, 323.06 7.21 4.10 19, 553, 547. 33 4.15
5. 02 1, 401, 062. 46 7. 29 3. 79 19, 211, 804.40 4.09
5.07 1, 601, 970. 64 7. 82 3.85 20, 486, 598. 35 4.29

N U M B E R A N D P E R C E N T OF A R T IC L E S R E D E E M E D , R E N E W E D , A N D SOLD A T T H E
M O N T -D E -P l£ T £ OF P A R IS , 1880 TO 1895.
Redeemed.
Year.

1880.......................................
1881.......................................
1882......................................
1883.......................................
1884.......................................
1885.......................................
1886.......................................
1887.......................... ............
1888.......................................
1889......................................
1890.......................................
1891.......................................
1892.......................................
1893......................................
1894.......................................
1895.......................................




Articles.

Per cent
o f total.

1,496, 637
1, 458, 438
1,401, 944
1,368, 932
1, 344,170
1, 311, 701
1,290, 253
1,259, 307
1, 220, 369
1, 263, 418
1,224, 657
1, 225, 281
1,234, 706
1, 225, 604
1,151, 593
1, 081,974

61.83
61.46
61.46
60. 21
57. 91
53.61
54.44
56. 33
54. 99
56. 00
55. 23
54.05
53. 51
54. 03
54.14
53.41

Renewed.

i

A rticles.

Per cent
o f total.

733,806
703,708
664, 617
684,165
740,256
799, 551
781, 940
781, 604
821, 382
825, 537
812,832
830, 445
828, 424
826, 216
795,079
785, 541

30. 31
29. 66
29.14
30. 09
31.89
32. 67
33.00
34. 96
37. 01
36. 59
36. 66
36. 64
35. 91
36.42
37. 38
38. 77

Sold.

1

A rticles.

P er cent
o f total.

190, 249
210,728
214, 340
220, 645
236, 875
335, 696
297, 617
194, 640
177, 415
167, 278
179,809
211, 057
244,137
216,529
180, 298
158, 392

7. 86
8. 88
9.40
9. 70
10. 20
13. 72
12.56
8.71
8. 00
7.41
8.11
9.31
10. 58
9. 55
8.48
7.82

Total.

2,420,692
2, 372,874
2, 280, 901
2,273, 742
2, 321, 301
2, 446, 948
2, 369, 810
2, 235, 551
2, 219,166
2, 256, 233
2, 217, 298
2, 266, 783
2, 307, 267
2, 268,349
2,126,970
2,025,907

226

BULLETIN OF THE DEPARTMENT OF LABOR.

T O T A L A N D A V E R A G E L O A N S ON A R T IC L E S R E D E E M E D , R E N E W E D , A N D
A T T H E MONT-DE-PI35T1S OF P A R IS , 1880 TO 1895.
Redeemed.

R enewed.

Sold.

Total.

Per
Per
Per A v e r­
Year. A m ount o f cent A v e r­
A v e r­
age A m ount o f cent age A m ount o f cent age A m ount o f
loans.
loans.
of
loans.
o
f
of
loans.
loan.
total. loan.
total.
total. loan.

1880..
1881-.
1882..
1883..
1884..
1885-.
1886..
1887..
1888..
1889..
1890..
1891..
1892..
1893..
1894..
1895..

$
$
$
$
$
6,284, 213.94 61.46 4. 20 3, 355, 085. 75 32.81 4. 57 585,752. 68
6, 253, 788. 26 61. 26! 4. 29 3, 313,163.07 32.45 4. 71 642,093. 82
6,373,287.11 61.67 4.55 3,264,941.82 31.59 4.91 696,321.61
6,447, 386. 95 60. 59 4. 71 3, 422,741.32 32.17 5. 00 770, 552. 69
6,129,157. 36 57.59 4. 56 3, 724, 937.83 35.00 5. 03 789, 068.15
5, 893, 838.83 53. 05 4.49 4,145, 404.93 37.32 5.18 1,070,149. 68
6, 308, 041. 53 55.54 4. 89 4,091, 225. 39 36.02 5. 23 958, 987. 86
6,141,479. 83 , 55.86 4. 88 4,192, 238. 69 38.13 5.36 660, 680.11
5,653, 533.17 i 52.69 4.63 4,478, 899.08 41.75 5.45 596, 370.19
6,071, 070. 341 54.72 4.81 4,504, 766.68 40.60 5.46 518, 976.04
5, 867, 302. 29 54. 34 4.79 4, 408, 360.09 40. 82 5.42 522,434.98
5, 986, 097.46 53.89 4.89 4, 535, 851.65 40.83 5.46 586, 261.24
6,374, 228.76 55.14 5.16 4,469,162. 04 38. 66 5.39 716, 517.33
6, 415,959. 02 55.66 5.23 4,416, 764. 66 38. 31 5. 35 695,141.61
5, 843,057. 82 53.31 5.07 4,486, 530.11 40.93 5.64 631, 262. 28
5, 297, 724.55 51.85 4. 90 4,405, 894.90 43.12 5. 61 513, 339.08

5.73
6. 29
6.74
7. 24
7.41
9. 63,
8.44 1
6. 01!
5. 56
4. 68
4.84
5. 28!
6.20
6. 03
5. 76
5. 03|

SOLD

A v e r­
age
loan.

$
$
$
3.08 10,225,052.37
4.22
3.05 10,209, 045.15
4. 30
3.25 10, 334,550.54
4. 53
3.49 10, 640, 680.96 4. 68
3.33 10, 643,163.34
4. 58
3.19 11,109,393.44
4.54
3.22 11, 358,254. 78 4.79
3.39 10, 994, 398. 63 4.92
3.36 10,728, 802.44 4. 83
3.10 11, 094, 813.06
4.92
2.91 10,798, 097. 36 4. 87
2.78 11,108, 210.35
4. 90
2. 93 11, 559, 908.13
5.01
3. 21 11,527, 865. 29 5.08
3. 50 10,960, 850.21
5.15
3. 24 10, 216,958. 53 5.04

All pledges enter the pawn shop either by original pledge or renewals,
and may be said to be disposed of in one of three ways—redemption,
renewal, or sale. In France the per cent of articles redeemed of the
total redeemed, renewed, and sold diminished from 66.15 in 1881 to
61.18 in 1892, while the per cent of the total sum redeemed diminished
from 60.51 to 56.57. In Paris the per cent of redemptions is not so large,
but the decline in the same period is greater. From 61.46 in 1881 the
per cent of articles leaving the pawn shop by redemption fell to 53.51
in 1892, and the decline in the per cent of the sum total represented
by these articles was from 61.26 to 55.14. This signifies in general
a decreasing ability to redeem pledges, which is more marked in Paris
than in the other cities of the country. This decrease in the proportion
of articles redeemed naturally caused either the renewals or sales or
both to increase, but a comparison of per cents shows that it is the
renewals that are increasing and not the sales.
The proportion of articles sold in Paris is somewhat greater than in
France, the per cent for Paris in 1892 being 10.58, in contrast to 8.72
for France in the same year. But, because of the higher average loan
made on articles sold throughout France, the per cent of the total sum
loaned on articles sold is higher for France than Paris, the per cent in
1892 being 7.82 for France and 6.20 for Paris. In Paris, beginning with
1880, the per cent of articles sold gradually increased from 7.86 to 13.72
in 1885. From this a marked decrease is noted, continuing until 1890,
when a slight increase occurs. In 1895 the per cent was 7.82. It must
not be considered, however, that 7.82 per cent of the articles pawned
in Paris are sold. As the figures do not refer to the pawns received, but
only to those released, which include many that have been renewed,
the per cents given are somewhat higher than would otherwise be the
case. It is probable, however, that about 5 per cent of all pledges
received come to sale.



PAWNBROKING IN EUROPE AND THE UNITED STATES.

227

The first of the two tables following shows the number of articles
out of each 1,000 pledged and renewed at the mont-de-pie te of Paris
and the per cent of the amount loaned for each of thirteen classes of
loans. The second table shows figures of like character for articles
pledged at the monts-de-piete of France, of Paris, and of Bordeaux, the
number of classes of loans being reduced to five. Both tables are for
the year 1891.
N U M B E R OF A R T IC L E S P E R 1,000 P L E D G E D A N D R E N E W E D A T T H E M O N T -D E -P IE t E
OF P A R IS A N D P E R C E N T OF A M O U N T LO A N E D , B Y S IZE OF LOAN S, 1891.
Pledged.
Size o f loan.

Per 1,000
articles.

3 francs ($0.58).....................................................................................
4 francs ($0.77).....................................................................................
5 francs ($0.97).....................................................................................
6 to 10 francs ($1.16 to $1.9 3)...........................................................
11 to 13 francs ($2.12 to $ 2.51).................................................. .
14 francs ($2.70)...................................................................................
15 francs ($2.90)...................................................................................
16 to 25 francs ($3.09 to $ 4.83).........................................................
26 to 50 francs ($5.02 to $9.65).........................................................
51 to 100 francs ($9.84 to $19.30).....................................................
101 to 500 francs ($19.49 to $96.50)..................................................
501 to 1,000 francs ($96.69 to $193)..................................................
1,001 francs ($193.19) or o v er...........................................................

Renewed

Per cent
Per cent
Per 1,000
of
of
amount articles. amount
loaned.
loaned.

145. 92
115.95
114. 51
273. 87
44.29
8.63
36. 99
73.76
91.15
60. 60
30. 60
2.14
1.59

1.73
1. 83
2.26
8.45
1.87
.48
2.19
5 94
13. 02
15. 31
21.45
6. 29
19.18

63.92
78.78
89. 86
323. 30
62. 98
10.31
53. 31
95.45
125.15
67. 24
27. 50
1.48
.72

0. 69
1.13
1.62
10. 54
3. 08
.52
2. 88
8. 60
19. 57
20.13
20. 97
3.85
6.42

N U M B E R OF A R T IC L E S P E R 1,000 P L E D G E D A T T H E M O N T S -D E -P I^ T ^ OF F R A N C E ,
OF P A R IS , A N D OF B O R D E A U X A N D P E R C E N T OF AM O U N T L O A N E D , B Y SIZE OF
LOAN S, 1891.
France.
Size o f loan.

10 francs ($1.93) or u n d e r ..........................
11 to 50 francs ($2.12 to $ 9.65)...................
51 to 100 francs ($9.84 to $19.30)...............
101 to 500 francs ($19.49 to $96.50)...........
501 francs ($96.69) or o v e r ........................

Bordeaux.

Paris.

Per cent
Per cent
Per cent
of
P er 1,000
Per 1,000
Per 1,000
of
of
articles. amount articles. amount articles. amount
loaned.
loaned.
loaned.
707. 76
222. 04
45.45
22. 59
2.16

19. 03
26.44
15. 76
21.32
17.45

650. 25
254.82
60. 60
30. 60
3.73

14. 27
23. 50
15. 31
21.45
25. 47

721. 59
214.74
41.34
20, 94
1.39

21.41
30.12
17.74
23.35
7. 38

The making of advances on pledges of small value constitutes the
greater bulk of the work done in all pawn shops. Of every 1,000
articles pledged in Paris in 1891, 115.92 were for the smallest possible
advance, 3 francs ($0.58), and but 1.59 for the sum of 1,001 francs
($193.19) or over. Yet loans of the latter class represented 19.18 per
cent of the sum loaned, and the former but 1.73 per cent; or if loans of
10 francs ($1.93) or less be considered, as shown in the second table, we
find that 650.25 of every 1,000 articles pledged were in that class, repre­
senting, however, but 14.27 per cent of the amount loaned, while but
3.73 articles in each 1,000 were for loans of 501 francs ($96.69) or over, yet
represented 25.47 per cent of the sum loaned. In Bordeaux the number
of loans of 10 francs ($1.93) or less was still larger, being 721.59 to
every 1,000 articles; while the loans of 501 francs ($96.69) or over were



228

BULLETIN OF THE DEPARTMENT OF LABOR.

1.39 to every 1,000. France was naturally between these two extremes,
707.76 of every 1,000 articles being for sums of 10 francs ($1.93) or less,
while 2.16 were for sums of 501 francs ($96.69) or over, representing
19.03 per cent, and 17.45 per cent of the amount loaned, respectively.
A general observation, and one substantiated by previous tables is
that renewals have a higher average value than pledges, which is
accounted for by the greater difficulty experienced in redeeming articles
of a high value. The variation may be well illustrated by noting the
relation of the amount loaned on articles renewed to that loaned on
articles pledged as given in the first of the two tables immediately
preceding. Whereas 650.25 of every 1,000 articles pledged in Paris
in 1891 were for sums of 10 francs ($1.93) or less, but 555.86 of every
1,000 articles renewed were for like amounts. This shows a much
smaller proportion of renewals for small amounts than of original
pledges and, on the other hand, a larger proportion of renewals for
large amounts, and bears out the conclusion stated.
The following table shows the average loans made on articles of
clothing and jewelry pledged and renewed at Bordeaux for the years
1886 to 1895:
A V E R A G E A M O U N T L O A N E D ON A R T IC L E S OF C L O T H IN G A N D J E W E L R Y P L E D G E D
A N D R E N E W E D A T T H E M O N T -D E -P I^ T ^ OF B O R D E A U X , 1886 TO 1895.
Pledged.

Renewed.

Year.
Clothing. Jew elry.
1886.................................................................
1887 .................................................................
1888.................................................................
1889 .................................................................
1890.................................................................
1891.................................................................
1892 .................................................................
1893 .................................................................
1894 .................................................................
1895 .................................................................

$1.09
1.13
1.24
1.28
1. 20
1.32
1.30
1.16
1.22
1.28

$6. 38
6.11
5. 99
5. 85
5. 82
5.80
5.88
5.89
5.98
5.47

Total.
$3.47
3.40
3. 34
3. 33
3. 29
3.31
3.12
3.14
3.25
3.17

Clothing. Jew elry.
$1.90
1.82
1.91
1.80
1.82
1.81
1.86
1. 87
1. 85
1.86

$8. 60
8. 94
8.73
8.65
8.43
8.15
7. 86
7.60
7.49
7. 61

Total.
$4.91
5.31
5. 22
5.19
5. 06
4.99
4.79
4.50
4.48
4.64

The report for 1895 of the director of the mont-de-pi^te at Bordeaux
permits a further consideration of the average loan. Heretofore the
item as given has included all classes of articles, but the above report
distinguishes between clothing and jewelry for both pledges and renew­
als. In the decade given, 1886 to 1895, the average loan on the pledges
has been reduced from 17.99 to 16.40 francs ($3.47 to $3.17), this being
due to the decline in the advances made on jewelry instead of clothing,
which, on the contrary, has increased from 5.67 to 6.61 francs ($1.09 to
$1.28). The showing for the renewals has been similar, save that the
average loan on clothing has very slightly declined instead of increased.




PAWNBROKING IN EUROPE AND THE UNITED STATES.

229

The following table shows a classification with reference to the
employment of the pledge owners and the amount of loan of articles
pledged in Paris in 1886:
A R T IC L E S P L E D G E D A T T H E M O N T -D E -P lfiT 'fi OF P A R IS B Y PERSON S I N V A R IO U S
E M P L O Y M E N T GROUPS, B Y SIZE OF LO A N S, 1886.
Pledged b y merchants and m anufac­
turers.
Size o f loan.

N ew
merchan­ Other
articles.
dise.

Pledged b y salaried
employees.

Total Per 1,000
A rticles. P er 1,000
articles. articles.
articles.

1,001 francs ($193.19) or o v e r............. ..........

391
502
684
2, 740
672
87
860
2, 097
3,511
2, 905
3,395
439
343

3,789
3, 519
4, 382
14, 912
4, 028
927
4,570
15, 801
22, 315
21,290
13,803
356
202

4. 180
4,021
5, 066
17, 652
4, 700
1,014
5, 430
17, 898
25, 826
24,195
17,198
795
545

32. 52
31.29
39. 42
137. 35
36.57
7. 89
42. 25
139. 26
200. 95
188. 26
133. 81
6.19
4. 24

24,470
21, 599
25, 869
57, 772
10, 964
1, 990
9, 830
21,016
28, 400
18, 217
5,430
63
24

108.45
95.72
114. 65
256. 03
48.59
8. 82
43.56
93.14
125.86
80. 73
24.06
. 28
.11

T o t a l........................ ..............................

18,626

109,894

128, 520

1, 0 0 0 .0 0

225, 644

1, 0 0 0 .0 0

3 f r a n c s ( $ 0 . 5 8 ) ......................................... ........................

4 francs ($0.77)..................................................
5 francs ($0.97)..................................................
6 to 10 francs ($1.16 to $ 1.9 3)....................
11 to 13 francs ($2.12 to $2.51)........................
14 francs ($2.70)................................................
15 francs ($2.90) ..............................................
16 to 25 francs ($3.09 to $4.83)......................
26 t o 50 f r a n c s ($5.02 t o $9.65)......................
51 to 100 francs ($9.84 to $19.30)...................
101 to 500 francs ($19.49 to $96.50)...............
501 t o 1 00 0 f r a n c s ( $ 9 6 .6 9 t o $ 1 9 3 ) ........ ...........

Pledged b y w ork ­
ing people.
Size o f loan.

Pledged b y per­ P ledged by persons
sons in m iscel­
in all occupa­
laneous occu ­
tions.
pations.

Per 1,000
Per 1,000
A rticles. Per 1,000 A rticles.
A rticles. articles.
articles.
articles.
154, 067
119, 326
109, 664
255, 521
35,583
6, 816
26, 404
41,413
43, 501
19, 769
3,173
10
1

188.98
146.37
134.52
313.43
43.64
8. 36
32. 39
50. 80
53. 36
24. 25
3.89
.01

27, 749
22, 299
24,567
64, 062
12, 624
2, 639
11,698
26, 049
33, 734
25, 227
18,330
1,196
1,047

T o t a l........................................................ 815, 248

1, 000. 00

271,221

3 francs ($0.58)..................................................
4 francs ($0.77)..................................................
5 francs ($0.97)..................................................
6 to 10 francs ($1.16 to $1.93)........................
11 to 13 francs ($2.12 to $2.51)......................
14 francs ($2.70)................................................
15 francs ($2.90)..............................................
16 to 25 francs ($3.09 to $4.83)......................
26 to 50 francs ($5.02 to $9.65)......................
51 to 100 francs ($9.84 to $19.30)...................
101 to 500 francs ($19.49 to $96.50).................
501 to 1,000 francs ($96.69 to $193)...............
1,001 francs ($193.19) or o v e r ........................

102.31
82. 22
90.58
236. 20
46. 55
9, 73
43.13
96. 04
124. 38
93. 01
67.58
4.41
3. 86

210, 466
167, 245
165,166
395, 007
63, 871
12, 459
53, 362
106, 376
131,461
87, 408
44,131
2, 064
1, 617

146.09
116.09
114.65
274.19
44. 34
8. 65
37. 04
73.84
91.25
60.68
30.63
1.43
1.12

1, 000. 00 1,440, 633

1, 000. 00

The great number of small merchants and manufacturers in Paris
render the contrast between the classes given above less marked than
might be expected^ yet their better economic condition is evident. Of
every 1,000 articles pledged by them, but 32.52 as against 108.45 for sal­
aried employees and 188.98 for workmen, were for loans of 3 francs
($0.58). Again, the maximum number of loans made by the merchants
were for the sums of 26 to 50 francs ($5.02 to $9.65), while for the
employees and workmen it was from 6 to 10 francs ($1.16 to $1.93).




230

BULLETIN OF THE DEPARTMENT OF LABOR.

The two tables following show the number of articles pledged and
renewed in France and in Paris and the amount loaned on such
articles for each month of the year 1892:
A R T IC L E S P L E D G E D A N D R E N E W E D A T T H E M O N T S -D E -P ltfT ^ OF F R A N C E A N D
L O A N S ON SUCH A R T IC L E S , B Y M O N TH S, 1892.
Pledged.
M onth.
A rticles.

Am ount
loaned.

Renewed.
A rticles.

A m ount
loaned.

Total.
A rticles.

A m ount
loaned.

J a n u a ry ......... ..................
February ..........................
M a rc h ................................
A p r i l .................................
M a y ...................................
J u n e .................................
July-- ................................
A u g u s t ..............................
S eptem ber........................
O ctober..............................
N o v e m b e r........................
D ecem ber..........................

300,605
267, 200
275, 441
278, 742
279, 782
284,022
603, 620
S05, 644
264, 746
266, 718
251, 010
245, 996

$1,199, 699.58
1,058, 726.01
1,124, 629.14
1,214,857.61
1,143, 576.72
1,126,529.23
1,341, 586.42
1,240, 726.36
1,083,447. 58
1,219,950.30
1,034, 660.84
1,000,917.49

125, 667
118, 699
121, 669
110,815
116,187
117, 600
117, 380
122,663
118, 922
127, 378
124,027
117,948

$651,821.02
592, 969.73
606,677.36
S52, 855.06
574,645.92
583, 986.54
615,301.18
619,878.56
587,394.34
657, 787.23
643,251.05
607,890. 36

426,272
385, 899
397,110
389, 557
395,969
401, 622
421, 000
428, 307
383, 668
394,096
375, 037
363,944

$1,851,520.60
1,651, 695.74
1, 731, 306. 50
1, 767, 712. 67
1, 718,222.64
1,710,515.77
1,956, 887. 60
1, 860,604.92
1,670,841.92
1, 877, 737. 53
1,677,911. 89
1, 608,807.85

T o t a l ......................

3, 323, 526

13,789, 307.28

1,438,955

7,294,458.35

4,762, 481

21,083,765.63

A R T IC L E S P L E D G E D A N D R E N E W E D A T T H E M O N T-D E-PLG t £
L O A N S ON SUCH A R T IC L E S , B Y M O N TH S, 1892.
Pledged.
M onth.
A rticles.

A m ount
loaned.

144, 547
121,900
119,151
126, 216
123,223
123, 785
143, 003
140,854
117,009
121,451
108, 330
102,202

$685,278. 35
670,572.85
594,325.55
661,760.72
621, 396.12
603, 668.87
787, 825. 80
696,258.11
581,613.99
685,452. 82
551,903. 76
511,059.37

T o t a l ...................... al,491, 671

a 7, 551,116.31

J a n u a ry ............................
F e b ru a ry ..........................
M a r c h ................................
A p r i l .................................
M a y ...................................
J u n e ...................................
J u l y ...................................
A u g u s t ..............................
Septem ber........................
O ctob er..............................
N o v e m b e r........................
D ecem ber..........................

OF P A R I S A N D

Renewed.
A rticles.
69,548
66,813
66, 336
59,992
63, 610
63, 792
63, 563
65, 867
63,432
69, 645
68,166
63, 714

Am ount
loaned.
$394,689.05
353,314.68
355,715.99
321.718.26
341,103.95
342,284.15
348.997.27
347,906.24
317, 741.69
360,135.49
361. 358.92
331,739. 98

a 784,478 a4,176, 705. 67

Total.
A rticles.

A m ount
loaned.

214.095 #L, 079, 967. 40
188,713
923, 887.53
950,041. 54
185,487
186, 208
983,478.98
186, 833
962, 500. 07
187, 577
945, 953. 02
206, 566
1,136,823. C7
206, 721
1, 044,164.35
180, 441
899, 355.68
191.096
1,045,588. 31
176,496
913, 262. 68
165,916
842,799.35
2,276,149

11, 727,821.98

a These figures do not agree w ith the figures fo r 1892 in the table on page 222, because 48,946 pledges
for loans aggregating 1,515,318 francs ($292,456.37), w hich were renewed at auxiliary offices, are
regarded as original pledges in this table, while in the preceding table they are considered as renewals.

The officials of the continental pawn shops are unanimous in the
opinion that renewals are decreased by the hard times, in that the
owners have not the means to pay the accrued interest, and that the
number of pledges increase as the times improve, since the small
traders begin to secure loans on unneeded portions of their stock to
increase their more popular lines or new enterprises are undertaken.
This is seen by the increased number of articles pledged in Paris and
France in 1883 and the decreased number of renewals in 1881. To these
yearly oy periodical fluctuations, due to the economic condition of the
country, variations equally marked, but due to local causes, may be
discovered. The months of January, April, July, and October show a
marked increase in the number of articles pledged in Paris, and the



PAWNBROKING IN EUROPE AND THE UNITED STATES.

231

same, but in a less marked degree, is true of France, a phenomenon
doubtless due to the quarterly payment of rents and other dues. Such
a regular fluctuation is not shown by the renewals, since those who are
obliged to pawn only on special occasions are usually provident enough
to redeem their pledges before the expiration of the loan, or, if renewed,
do so prior to the expiration of the loan period.
The table following shows the average number of pawns pledged,
renewed, and redeemed in Bordeaux on each day of the week through­
out the year 1895:
A V E R A G E P A W N S PL E D G E D , R E N E W E D , A N D R E D E E M E D IN B O R D E A U X ON E A C H
D A T OF T H E W E E K FO R T H E Y E A R 1895.
Day.
M o n d a y .............................................................................................................
T u e s d a y ............................................................................................................
W e d n e sd a y ............... ....................... ......................... ......................................
T h u rsd a y ........... ................. ..........................................................................
F r id a y .................................................................................................................
Saturday.............................................................................................................

Pledged. Renewed.
696
670
639
678
625
516

323
410
691
393
318
283

Redeemed.
474
507
386
418
558
954

The relative amount of business done by the mont-de-piete of Bor­
deaux on the several days of the week may be taken as illustrative of
the experience of other cities. According to the report of the director,
the greatest number of articles were received in pawn on Monday,
after which the number gradually declined during the week, with the
exception of Thursday, and reached its lowest point on Saturday. In
Bordeaux, as also in Rouen, the largest number of renewals occur on
Wednesday, while the number of articles redeemed on Saturday is
almost double that of the other days of the week. The increased
number of pledges for Monday and redemptions occurring Saturday
may be attributed to the large class of persons known as u repeat­
ers,77those who pawn their goods on Monday and redeem them again
Saturday.
A movement as pronounced as the increase of pledges on Monday
and redemptions on Saturday is the effect of fete days. In 1895 the
average number of pledges received daily in Bordeaux was 637, but on
the day following Assumption the number rose to 1,013, and the second
day after Christmas to 1,328. In Rouen the same result is seen. The
daily number of pledges in the same year was 200, but on January 2
303 articles were received; on April 18, the Thursday of Easter week,
the number was 348; on July 16, the day following the great national
celebration (the 14th being on Sunday, the celebration occurred on the
15th) there were 305; on July 17, 325, and on August 16, the day fol­
lowing Assumption, 318.
The effect on the number of redemptions is as clearly marked. The
average daily number of articles redeemed in Bordeaux during the
year was 552, but the Saturday before Palm Sunday the number rose
to 1,138; on April 13, the Saturday before Easter week, to 1,407; and




232

BULLETIN OF THE DEPARTMENT OF LABOR.

on June 1, the Saturday before Whitsunday, to 1,573. The daily aver­
age in Rouen for the same year was 165, but the number of redemp­
tions April 6, the Saturday prior to Palm Sunday, was 391; April 13,
636; July 13, the day before the national holiday, 501; and December
31, 576. From this it is evident that many make a special effort to
redeem their jewelry and better clothing for use during the celebra­
tion and after it is over again repledge it.
SALES AND

SURPLUS A S

SH O W N B Y
P A R IS .

T H E M O N T -D E -P IE T E

OF

The following table shows the amount of surplus and the losses from
sale of pledges by the Mont-de-Piete of Paris from 1885 to 1896:
SU R PLU S R E A L IZ E D A N D LOSS S U S T A IN E D ON P L E D G E S SOLD B Y T H E M O N T-D EP I E t U OF P A R IS , 1885 TO 1896.
Pledges sold.

A rticles.

1885
1886
1887
1888
1889
1890
1891
1892
1893
1894
1895
1896

A m ount
loaned.

........................................ 335, 696 $1, 070,149. 68
........................................ 297, 617
958,987. 86
........................................ 194, 640
660, 680.11
596, 370.19
..................... ..................
177, 415
518, 976. 04
........................................ 167, 278
522,434.98
........................................ 179, 809
586, 261. 24
........................................ 211,057
716, 517.33
........................................ 244,137
695,141. 61
........................................ 216,529
631,262. 28
180,298
........................................
513,339. 08
........................................ 158, 392
407, 325.11
128, 069
..................... . ................... .....................
.....................

Surplus.

A m ount.

$215, 789.49
240, 007. 61
232,579.97
217, 984.80
196.731.93
199,411.02
178.456.94
183, 611.44
194,442.00
163, 946.14
168, 432.52
145, 964.16

Loss.

P er cent
of
amount
loaned.

A m ou nt.

20.16 $36,556. 54
25. 03 22,127.87
35. 20
8,194. 71
36.55
5, 807. 24
37.91
5,168. 92
38.17
5,683. 01
6,924. 42
30.44
25. 63 11,727. 36
27.97 13,446.48
25.97 21,192. 21
32. 81
7,342.24
35. 83
4, 411. 01

Per cent
of
amount
loaned.
3.42
2.31
1. 24
.97
1.00
1. 09
1.18
1.64
1.93
3. 36
1.43
1. 08

The sale of the 335,696 articles brought to auction in Paris in 1885
realized 20.16 per cent more than was advanced on them. Five years
later this surplus was 38.17 per cent, after which it falls to 25.63 in
1892, to rise again to 35.83 in 1896. In the same period a loss of 3.42
per cent was sustained in 1885, which fell to 0.97 per cent in 1888, was
only 1 per cent in 1889, and five years later rose to 3.36, to lower again
to 1.08 in 1896. In 1885, 735 of every 1,000 articles sold produced a
surplus, 234 sold at a loss, and 31 exactly met the amount advanced,
while in 1896, 866 produced a surplus, 61 resulted in a loss, and 73
netted the amount loaned. It is to be remembered, however, that the
surplus is held subject to the demand of the owner instead of going to
the institution as profit, and that the loss is made up by the appraisers
who determine the amount to be advanced on the pledge.
This large per cent of the surplus may arise either through the failure
of the appraisers to properly estimate the value of the articles offered
in pawn, or to the refusal of the owners to accept the full amount of the
sum that might be advanced on their pledge. The former is doubtless
the real reason, for only in rare instances do individuals present a pawn
of a value more than sufficient to secure the loan desired. If this be




233

PAWNBROKING IN EUROPE AND THE UNITED STATES.

true, their error is well illustrated by the sales of 1896. In that year
14,758 pawns sold for twice the amount of the advance on them; 2,873
for three times the advance; 687 for four times; 232, five times; 118,
six times; 42, seven times; 12, eight times; 6, nine times, and4, ten
times, and besides others intervening one article sold for twenty-seven
times the amount advanced by the appraisers.
The dates of original pledging of articles sold by the mont-de-piet6
of Paris during the years 1894 to 1896 are shown in the following
table :
D A T E OE ORIGINAL PLEDGING OE ARTICLES SOLD BY TH E M O N T-D E-PI^T^ OF
PARIS, 1894 TO 1896.

Date o f original
pledging.

A rticles sold in —
1894.

1843............................
1844............................
1845............................
1848............................
1850............................
1851............................
1852............................
1853............................
1855............................
1857............................
1858 ..........................
1859............................
I860............................
1861............................
1862............................
1863............................
1864............................
1865............................
1866............................
1867............................
1868............................
1869............................
1870............................
1871
1872............................

1896.

1895.

1
1.
1
1
26
2
2
1
2
2
2
10
1
7
9
9

10
14
16
20
35
46
47

1

2
1
1
2
2
4
5
5

6
4
8
16
12
18
20
23
44

Date o f original
pledging.

1873..........................
1874..........................
1875..........................
1876..........................
1877..........................
1878..........................
1879..........................
1880..........................
1 1881..........................
1882..........................
1 1883..........................
3 1884..........................
1885..........................
3
1886..........................
1 1887..........................
1 1888........................ .
3
1889..........................
1890..........................
4
7 i 1891..........................
n
1892..........................
10 1893..........................
12 1894..........................
10 1895..........................
18
37
T otal...........

A rticles s o ld :in—
1894.
60
86
115
126
179
178
261
291
462
679
1, 061
1,337
1,573
2, O il

2,875
4, 876
7,118
13, 390
23, 304
10, 295
109,756

180, 298

1895.

1896.

60
80
70
100
163
178
184
272
341
472
768
884
933
1, 355
1, 756
3,101
4, 505
6, 654
11,111
20, 357
5,884
98,990

34
42
71
89
123
111
158
182
234
332
512
612
699
873
1, 310
2, 052
2’ 292
5, 574
5, 673
9, 600
16, 201
4, 453
76, 720

158, 392

128, 069

A remarkable feature of the business is the number of years that
some will pay interest on advances before allowing their pledges to be
sold. In 1894 and the year following, pledges came to auction upon
which their owners had paid interest for half a century, while it is
not unusual to sell pawns that have been renewed from 30 to 35 times.
As a rule articles that are so persistently renewed are above the aver­
age value, but in 1894 an article was sold upon which a loan of 3 francs
($0.58) had been made fifty years previous.
A t the time the mont-de-piet^ of Paris was founded, it was feared
that the officials would incur a great loss upon the institution by the
improper appraisal of articles offered in pledge. To avoid this, the mat­
ter was placed in the hands of the appraisers (eommissaires priseum),
who, in return for certain fees, agreed to bear any loss arising from the
sale of unredeemed pledges, and in 1848 they were further intrusted
with the sale of such {hedges. The number of appraisers to be employed
is determined by the director, subject to the approval of the prefect of
the Seine and the council of surveillance, but the designating of those
9986—No. 21-----5



234

BULLETIN OF THE DEPARTMENT OF LABOR.

who are to act is in the hands of the prefect, who chooses from a triple
list presented to him by the chamber of that body. As a matter of
fact, however, but fourteen of the regular members of the chamber are
actively employed in the work, the remainder of it being done by depu­
ties appointed by the appraisers, with the sanction of the authorities.
The fee for appraisal, limited by statute to not over one-half per cent,
is fixed at the beginning of each year by the prefect of the Seine, at the
suggestion of the director, who acts with the consent of the council.
In point of fact, however, the maximum rate is always allowed on
common pledges, and one-fourth per cent on stocks and like securities.
Their remaining income is a 3 per cent fee on auction sales, which is
paid by the purchaser of the article.
The point of weakness in the plan is that, the appraisers being respon­
sible for the losses, they consent to such small advances as not only to
materially lessen the revenue of the institution, but to cause very seri­
ous hardships to many in need of funds. While it is impossible to esti­
mate the loss arising from the low valuation of pawns actually received,
some idea of the possible increase in the amount loaned is ascertained
by a reference to the loans refused. In 1895, 86,682 articles were
deemed of insufficient value to secure a loan of 3 francs ($0.58), while
33,303 other articles on which the appraisers offered to advance a sum
total of 2,657,195 francs ($512,838.61) were withdrawn by the owners on
the ground of too low a valuation.
STO LEN P A W N S .

To hinder the pledging of stolen or lost property, the law authorizes
the officials of the mont-de-piete to suspend the payment of a loan when
there is any doubt as to the right of the pledger to dispose of the arti­
cle offered. To this end every applicant for an advance must establish
his identity by the means previously mentioned. Further, complete
lists of all lost or stolen articles are kept and a constant effort made to
avoid accepting such in pawn. If, however, after due precaution, a
stolen or lost article is accepted, the owner, in order to obtain it, must
reimburse the institution for any amount advanced, together with
charges and accrued interest.
To meet the criticism that the mont-de-pffit6 acts as a receptacle for
Stolen goods, the authorities in 1881 and again in 1890 annexed to their
usual report a statement of the work of the institution in this line. It
appears that in 1881 advances were suspended on 44,820 articles. On
investigation, however, but 330 of these were found to be of suspicious
origin. In 1890, 42,032 suspensions were made, of which 240 were found
suspicious; that is, of every 1,000 articles held up, but 7.36 and 5.71,
respectively, proved to be of suspicious origin. But the above figures
give no definite idea of the effectiveness of the measures employed.
This may be better seen from a study of the means used to discover
the lost or stolen articles that escape the suspicion of the officials and
are accepted.



PAWNBROKING IN EUROPE AND THE UNITED STATES.

235

To facilitate tlie return of such pledges to their rightful owners, several
methods are employed. At the end of each day the bureaus or branch
offices make reports to the central authorities, giving the description
of all articles received under certain determined conditions. These
reports are then carefully scrutinized to discover if the description of
the article corresponds to that of any reported by the police depart­
ment. For the identification of cloth which is stolen in bolts and then
divided, a portion being pledged in one or more of the several branch
offices, it is required that a sample of all such cloth received be for­
warded to the central office at the end of every two weeks. Further,
any initials, names, marks, etc., borne by the pledge, as also any and
all marks of manufacturers and firms, are recorded in a separate col­
umn of the register in order to facilitate the search for the reported
articles. The greatest care, however, is taken with watches. Each day
a report of the number of the works and case, as well as the name of
the maker of every watch received, is sent to the central department,
where an employee arranges the numbers in series that are readily
comparable with a like series constructed from the reports received
from the police. These efforts of the mont-de-piete itself are supple­
mented by the police department, which, aside from reporting articles
as lost or stolen, seizes all tickets found in possession of persons ar­
rested, which tickets are held by the institution until it is satisfactorily
proved that the articles they call for are or are not the rightful prop­
erty of the one from whom they were taken.
In 1881 there were 1,598,018 pledges received by the monts-de-piete,
of which number 1,042 were recognized as lost or stolen and 330 were
held as being of suspicious origin. This makes a total of 1,372, or 8.59
out of every 10,000 articles pledged.
As regards the means adopted for identifying the various classes of
articles accepted by the officials and later recognized as having been
lost or stolen, it was found that out of a total of 360,000 watches pledged
but 254, or 7.06 per 10,000, had been so recognized. Of 810 pledges
deposited by persons arrested, 403 were found to be lost or stolen, while
407 proved to be their rightful property. Of 107,450 articles noted
under certain conditions in the daily reports, 348, or 3.24 per 1,000,
were recognized as lost or stolen. Of 7,350 samples of goods furnished,
23, or 3.13 per 1,000, and of 151,000 marked articles, 14, or 0.93 per
10,000, were identified as lost or stolen property.
P L E D G E B R O K E R S O F P A R I S (M A R C H A N D S D E R E C O N N A I S ­
S A N C E S ).

One of the principal evils arising from the low valuation placed on
pledges is the traffic in pawn tickets. Due to the margin between the
amount advanced by the appraisers and that which the pledges will
bring at auction, a numerous class of traders have arisen, who, on
security of the pledge, will make an additional loan. The transaction
takes the form of a repledging of the pawn ticket for an advance of 20



236

BULLETIN OF THE DEPARTMENT OF LABOR.

per cent of the loan made by the mont-de-piete. The pledger gives his
ticket into the hands of the broker and receives in return a ticket. On
such additional loans 10 per cent per month is usually charged, the
advance as a rule to be paid within a month, but longer periods are
sometimes given. If, however, not redeemed or renewed at the expira­
tion of the period, the ticket becomes the property of the broker, who
may redeem the pledge or allow it to be sold at auction and then
collect the surplus. The latter is the usual plan. Yet it is quite cus­
tomary for the broker to redeem a sufficient number to enable him to
do a small business in second-hand articles.
The following table gives a statement of the number of tickets pre­
sented by the pledge brokers of Paris and their profits on such tickets
from 1887 to 1896:
TICK ETS PRESENTED B Y PLEDGE BROKERS OP PAR IS A N D BROKERS’ PROFITS ON
SUCH TICKETS, 1887 TO 1896.

1887.

1888.

1889.

1890.

1891.

N um ber o f pawn tickets presented b y
56, 655
pledge b r o k e r s .......................................1.
46, 332
100,143
59,001
77,919
A m ou nt loaned b y the mont-de-pi6t6 on
the sam e....................................................... $189, 463. 08 $144, 952. 46 $170,205.73 $209, 254. 27 $251, 617. 57
A m ou nt paid b y the brokers for the
tickets (20 per cent o f amount loaned). 37, 892. 62
28, 990.40
34, 041.15
41, 850. 85
50, 323. 51
52, 235.15
Surplus paid the brok ers............................ 57, 590. 76
67, 384.01
79, 893.47
80, 359.51
19, 698.14
23, 244. 66
33, 342. 86
38, 042. 62
B rokers’ p r o fit s ............................................
30, 036. 00
.502
A verage brokers’ profit per a rtic le .........
.348
.565
.488
.300
1892.

1893.

1894.

1895.

1896.

N um ber o f pawn tickets presented b y
86,083
66, 276
pledge b r o k e r s ..........................................
117,643
115, 896
80, 248
A m ou nt loaned b y the mont-de-pi6t6 on
the sam e....................................................... $328,480.98 $341,135.61 $275, 854. 32 $241,902.34 $185, 522. 60
A m ou n t paid b y the brokers for the
48,380.47
55,170.48
37,104.52
68,227.12
tickets (20 per cent o f amount loaned). 65, 696.20
96, 330.63
73, 941. 64
66, 021. 53
87, 297. 35
75, 711. 33
Surplus paid the brokers............................
20, 540.85
25,561.17
21, 601.15
28,103. 51
28,917. 01
B rokers’ p r o fit s ............................................
.242
.239
.319
.184
.436
A vera g e brokers’ profit per article.........

Some idea of the extent of this traffic in tickets and the profits
arising from it may be seen from the above tabulation. Of course no
conclusion as to the number o f tickets purchased or pledged is possi­
ble, the above being the number of unredeemed tickets presented by
the brokers for the surplus due. From this we find that the smallest
number presented in the past decade was 46,332 in 1888, the largest
117,643 in 1892, upon which the brokers secured 270,648.45 francs
($52,235.15) and 452,317.85 francs ($87,297.35) surplus, respectively.
Or, if the amount advanced on the tickets be deducted, the average
profit on each ticket was 2.60 francs ($0,502) and 0.953 francs ($0,184)
for the two years mentioned.
To stop this traffic several plans have been suggested. The apprais­
ers themselves propose that the pawn tickets no longer be made




PAWNBROKING IN EUROPE AND THE UNITED STATES.

237

payable to the bearer, but acknowledge that this would increase the
practice of clandestine pawning. A plan favored by many of the
officers of the institution is for the mont-de-piet6 to accept its own
tickets in pledge, advancing thereon the usual 20 per cent at a reason­
able rate of interest, but no steps looking to its adoption have as yet
been taken. A most plausible plan is that of Belgium, where it is
made a penal offense to purchase or deal in pawn tickets. Yet it is
understood that even there a very limited trade in pawn tickets is car­
ried on, but not by far so extensive as that of Paris.
To have exactly covered the expenses of appraisal, handling, storing,
and all other outlays on loans in Paris, each pawn should have paid at
least 1.12 francs ($0,216) as interest and charges, but as it was impossible
for loans of less than 24 francs ($4.63) to produce this amount, they were
classed in 1895 as “ onerous.” In regard to the amount and duration
of the loans necessary to meet the actual expense, the smallest sum
capable of doing this was 24 francs ($4.63) with interest for a year, and
the largest 97 francs ($18.72) with interest for two weeks. The report
for 1895 does not give the number of pawns in each class, but an esti­
mate made in 1891 places 1,763,695 of the total pledges and renewals
in the first or unprofitable class, 411,768 in the second, where the income
equals the expenditure, and only 118,327 in the third, or loans on which
a profit was made.
F IN A N C IA L

MANAGEM ENT

OF TH E

M O N T -D E -P IE T E OF P A R IS .

It is worthy of note that France has been particularly loath to adopt
utopian schemes in the financial management of its mont-de-piete.
Although revolution has at times completely changed the administra­
tion and destroyed the financial foundation so carefully constructed,
the better judgment of its officers has constantly thrust aside proposi­
tions for lotteries and other fanciful schemes intended to repair the
damage done, and met the difficulties in a purely business way. What­
ever may be said against the present disposition of its profits, or
whatever criticism may be offered as to the general administration, it
is to their credit that they have ever maintained the dignity of respon­
sible financial institutions.
Early methods used to secure capital were suggested by expediency,
and failed to give stable support; but later, when it was recognized
that the mont-de-piete had the unique distinction of being a self-sup­
porting charity—that the State and municipality practically gave their
guaranties for its proper administration—it assumed the dignity of a
responsible agent, and instead of soliciting funds was solicited to
accept them. Thus, its financial condition assured, the question for
decision was the best policy to be assumed toward the available funds
so as to advantageously secure a stable capital. In seeking an answer




238

BULLETIN OF THE DEPARTMENT OF LABOR.

to this the administration of the mont-de-piete of Paris has adopted
several plans. When founded in 1777, as previously stated, it was
decided that the administration of the public charities (hopital general)
should furnish the capital; but instead of making the institution inde­
pendent, the prevalent idea of associated charities led them to consti­
tute it a sort of adjunct to the public charities. It was required to pay
interest to the public charities on the funds advanced; but that alone
did not discharge its debt. It must also surrender its profits and
unclaimed surplus arising from the sale of unclaimed pledges to the
same institution, instead of being allowed to form a reserve for its own
use. This unfortunate provision once incorporated in the law has clung
with peculiar tenacity to Paris. While in other cities the monts-depiete have as a rule gained their independence, and to-day in many
instances possess a capital almost sufficient for their needs, Paris, much
to the discomfort of the directors, still pays several thousand francs
yearly to the poor fund (hospices civils), and remains without a dollar
of capital which it can call its own. Space does not permit entering
upon the discussion which this policy has aroused between the public
charities and the mont-de-piete as to the rights of the former to receive
the profits of the latter. It must, however, be understood that the
present policy hinders the lowering of the rate of interest, and is prac­
tically the exploitation of one class of indigents for the benefit of
another.
As the business increased the administrators of the public charities
were unable to supply sufficient capital, and loans were resorted to.
Again insufficient, a sort of joint-stock company was formed, the holders
of stock having representation in the council of administration; but
fearing lest this method should eventually destroy its charitable char­
acter it was abandoned in favor of loans secured by mortgage on the
property of the u assistance publique.’? Such loans were practically
deposits which private parties made, receiving therefor a sort of bond
payable to bearer, the rate of interest depending on the money market.
This method was pursued until 1844, when certificates of deposit paya­
ble to order were introduced. The following year a decree of the council
provided that these certificates be issued in five classes, viz: 250 francs
($48.25), 500 francs ($96.50), 1,000 francs ($193), 5,000 francs ($965), and
10,000 francs ($1,930). But as many of the depositors, even at this date,
were persons of small means, who used the mont-de-piete as a sort of
savings bank, it was found that the minimum certificate was beyond
their reach. It was difficult for them to raise 250 francs ($48.25), or if,
fortunately, they had 350 francs ($67.55) or more a portion of it must
lie idle or be invested in other ways. To. obviate this difficulty the law
was modified so that deposits of 100 francs ($19.30) could be made. All
sums were received for a year, subject to renewal, if satisfactory to
both parties; but as the amount of capital varied during the year, and




PAWNBROKING IN EUROPE AND THE UNITED STATES.

239

as many of its patrons desired to make short-time deposits, it was
thought to be of mutual advantage to accept deposits for three and six
months, and in 1892 for similar reasons nine-month deposits were
introduced.
The plan of accepting deposits for less than a year, while increasing the
amount of clerical work, secures the elasticity of capital needed in a busi­
ness of this sort. A reference to the report of the mont-de-piete of Paris
for 1896 shows that the smallest amount of capital outstanding, about
January 15, was 45,326,484 francs ($8,748,011.41), after which the amount
gradually increases until the first of July, then very rapidly during July
and August, but slightly during September and the first half of Octo­
ber, when the maximum amount, 48,643,325 francs ($9,388,161.73), was
outstanding. This continual change of capital, requiring over 3,000,000
francs ($579,000) more in summer than winter, if borrowed upon yearly
deposits would involve a large outlay for interest without any commen­
surate return. It is true the mont-de-pidte is permitted to deposit its
surplus capital in the treasury and receive interest thereon, but the
treasury pays from 1 to 1 £ per cent less than the mont-de-piete, so
that surplus capital simply means a loss to the latter. Yet it was not
alone to avoid the loss thus sustained that fractional deposits were
introduced, but that many persons wishing to hold their money subject
to better investment were willing and even anxious to accept a low
rate of interest for a few months rather than to allow their money to
remain absolutely idle. The result is that by the adoption of this
method the mont-de-pi^te is enabled to secure funds at a much lower
rate than possible upon a longer deposit and yet advantageously to all
concerned.
The financial policy of the institution is a most conservative one.
While attempting to supply the needy with money at the lowest charge,
no effort is made to borrow funds for this purpose at a rate below the
ordinary. As repeatedly stated in the reports of the director, its prin­
cipal concern is to secure a stable capital. To this end it zealously
avoids paying a rate of interest which would attract speculative capi­
tal, and yet seeks to maintain a rate that will attract nonspeculative
capital and induce its owners to allow their funds to remain from year
to year in the service of the institution. It is its avowed intention to
win the confidence of the laboring classes and the small capitalists and
induce them to intrust their savings to its keeping; in short, to serve
first and as far as possible the interest of the middle and lower classes
without withholding from anyone the opportunity to secure its bene­
fits or avail themselves of its services. With this as the accepted
policy it remains to see in how far it has been successfully carried out,
and to what extent it has met with success.
As the deposits remaining with the mont-de-piete for the entire year
represent by far the more stable portion of its capital, a consistent fol­




240

BULLETIN OF THE DEPARTMENT OF LABOR.

lowing of the policy outlined would require that such deposits approxi­
mate the amount of capital outstanding upon pawns during the year,
while those deposits accepted for fractional years would be adjusted to
meet the fluctuation of the business. To ascertain to what extent this
is true, the following table, showing the amount and interest-bearing
period of deposits accepted from 1886 to 1895, as also the smallest
amount outstanding on pledges in each year of this period, has been
constructed:
C A P I T A L B O R R O W E D B Y TH E M O X T -D E -P r£ T ;fi OF P A R IS , 1886 TO 1895.

Year.

1886 ................................................
1887 ................................................
1888 ................................................
1889................................................
1890 ................................................
1891................................................
1892 ................................................
1893 ........................ .......................
1894................................................
1895 ................................................

Smallest
amount out­
standing on
pledges dur­
ing the year.

A m ount borrow ed for—
12 months.

$8,525, 621.57 $8, 895, 979.88
8, 504,726.42 8, 853, 396. 36
8, 635, 558.03 8, 573, 415.12
8, 853,112.84 8,585, 085. 83
8,853,112.84 8,751, 992. 23
9, 252,443. 74 9,048,183.54
9, 735, 593.18 9, 395,199.47
9, 556, 516. 01 9, 385, 653.69
8, 890, 549. 39 9,100, 961.32
8, 819,157.97 8, 595, 909.27

9 months.

6months.

$905,664.08
1, 563, 052.96
1,779,135. 76
1, 827,185. 04

$875, 347.64
1,122, 225. 52
821, 369.40
882, 666.46
793,870.76
1,209, 399. 76
1,170, 988. 90
565,196. 64
497, 258.71
618,109. 52

3 months.

$653, 656.26
556, 065.81
471,257. 75
772, 590. 58
573, 061.39
898, 241.30
1,238. 737. 69
501,097.48
420,184.16
225, 215.56

By comparing the first two columns it will be seen that with the
exception of the first two years, as also 1894, the sums deposited for a
year have been a trifle less than the smallest amount outstanding. A
general comparison further evidences a greater desire to increase the
nine months7deposits to the detriment of those of other interest-bearing
periods. This apparent deviation from the policy outlined must be con­
sidered with the fact in mind that during the past decade capital has
been very abundant. The director in his report for 1886 remarks that
the administration has refused over 11,810,000 francs ($2,279,330) offered
for deposit in that year, 4,800,000 francs ($926,400) of which was refused
during the month of May; and he estimates that had they so desired
it would have been possible to secure from 30,000,000 to 40,000,000 francs
($5,790,000 to $7,720,000) more than they did, yet the year 1886 did not
show an exceptional amount of free capital. Later reports are unani­
mous in the statement that “ capital has been abundant,77or that u capi­
tal has been easily obtained at the following rates.77 With funds thus
waiting investment, it is readily seen that deposits for three and six
months could have been obtained at from 1 J to 2 per cent per annum,
instead of paying 2£ and 3 per cent upon nine months7 deposits, as was
done. Under such circumstances the slight reduction in the yearly
deposits may be allowed without considering it a deviation from its fixed
policy.




PAWNBROKING IN EUROPE AND THE UNITED STATES.

241

The following table is given to show the stability of the deposits or
capital of the mont-de-pi6te of Paris:
S T A B I L I T Y OF T H E D E PO SITS OR C A P I T A L OF T H E M O H T -D E -P I^ T ^ OF P A R IS ,
1892 TO 1896.
Capital borrowed forYear.

1892 ........
1893 ........
1894 ........
1895 ........
1896 ........

Per cent
12 months.
o f new
funds o f
total
Per cent Per cent
capital.
o f new
o f total
funds.
capital.
20.0
12.5
9.0
5.0
10.3

73.9
78.1
77.1
76.3
69.3

10.1
5.9
2.1
0.6
0.8

9 months.

3 months.

6 months.

Per cent
o f total
capital.

Per cent
of new
funds.

Per cent
ot total
capital.

P er cent
o f new
funds.

Per cent
o f total
capital.

7.1
13.0
15.1
16.2
25.3

49.8
37.4
31.2
24.5
44.9

9.2
4.7
4.2
5.5
4.0

38.4
32.9
28.1
8.2
37.1

9.8
4.2
3.6
2.0
1.4

Per cent
o f new
funds.
54.0
36.0
49.8
17.0
28.0

The above table indicates the success of the authorities in their
attempts to induce depositors to renew their deposits from year to
year and secure the institution the desired stability of capital. Of
the 55,000,000 francs ($10,615,000) borrowed by the mont-de-piete in
1896, the new funds constituted but 10.3 per cent of the total capital;
that is, almost 90 per cent of the entire sum borrowed was not with­
drawn from the institution. This showing for 1896 may be taken as
representative of the normal fluctuation. The 20 per cent of new
funds for 1892 and the 12.5 per cent for 1893, being considerably above
the normal, were due to the introduction of loans on stocks, bonds, etc.,
requiring large additions to the capital; while the very low per cent of
1895 was due to a reduction of the amount of capital made necessary
by a decrease in the sum total of business done. In like manner the
capital borrowed for twelve months shows a 10.1 per cent influx of
new funds in 1892. But the marked decline from that date, or perhaps
from 1893, falling to 0.8 per cent in 1896 is not normal, but caused by
the decrease in the amount of business done and the presence of a
great abundance of capital, which has had the tendency to cause the
administration to accept the cheaper loans for fractional periods.
The deposits for less than a year quite naturally have a less stable
character than the yearly deposits. While the authorities only refuse
to renew deposits when absolutely necessary, the needs of the business
rather than the desire of the patrons must govern their action, and
this of late, when the capital required is decreasing, has made refusals
at times necessary. Moreover the rate of interest paid on this class of
funds causes a constant withdrawal of deposits as more advantageous
investments are found. Yet the increase of the nine months7 capital
from 16.2 to 25.3 per cent of the total capital from 1895 to 1896 is not
due to the needs of the business, but the desire of the authorities to
avail themselves of the abundance of capital at their disposition and
secure funds at 2J per cent instead of 3 per cent per annum. In the
future, however, we may expect to see this return to the normal, as the




242

BULLETIN OF THE DEPARTMENT OF LABOR.

rate of interest on yearly deposits was reduced in May, 1897, from 3
per cent to 2| per cent per annum.
A statement of the interest rates on deposits at the mont-de-pi6t6 of
Paris is shown in the following table:
R A T E OE INTER EST ON DEPOSITS A T THE MONT-DE-PB£ t £ OF PAR IS, 1872 TO 1897.
Per cent on deposits for—

Tear.

Periods.

1872.
1873.
1874.

1875.
1876.
1877

1878

.

1879 to 1881 .
1882.........
1883
1884

.
.

1885.
1886 to 1891 .
1892
.
1893 to 1896 .
1897...............

January 1 to A u gu st 2 ...........
A u gu st 3 to September 16----September 17 to Decem ber 31
January 1 to J u ly 4 .................
J u ly 5 to September 3.............
September 4 to Decem ber 31 .
January 1 to M arch 19...........
M arch 20 to June 24.................
June 25 to J u ly 19....................
J u ly 20 to December 10...........
Decem ber 11 to December 31.
January 1 to M arch 1 1 ...........
M arch 12 to June 1 8 ...............
June 19 to Decem ber 3 1 .........
January 1 to January 1 7 ........
January 18 to M ay 9 .................
M ay 10 to December 31...........
January 1 to January 9 .........
January 10 to M ay 6 ...............
M ay 7 to J uly 2 9 ......................
J u ly 30 to December 31...........
January 1 to June 30...............
J u ly 1 to December 31.............
January 1 to Decem ber 31----January 1 to A u gu st 7 ...........
A ugu st 8 to December 31.......
January 1 to December 31___
January 1 to M ay 1 9 ...............
M ay 20 to Novem ber 1 0 .........
Novem ber 11 to Decem ber 31.
January 1 to March 8 .............
M arch 9 to June 17...................
June 18 to Decem ber 3 1 .........
January 1 to Decem ber 31----January 1 to J u ly 1 .................
J u ly 2 to December 31.............
January 1 to December 31----January 1 to A p ril 3 0 .............
M ay 1 to Decem ber 31........... .

12
9
6
3
months. months. months months.
4.0
5.0
4.5
4.5
5. 0
5.5
5.5
5.0
4.5
4.0
4.5
4.5
4.0
3.5
3.5
4.0
3.0
3.0
3.0
4.0
3.5
3.5
3.0
3.0
3.0
3.5
3.5
3.5
3.0
3.5
3.5
3.0
3.0
3.0
3.0
3.0
3.0
3.0
2.75

2.5
2.5
2.5
2.5

3.5
4.5
4.0
4.0
4.5
5.0
5.0
4.5
4.0
3.5
3.5
3.5
3.5
3.0
3.0
3.0
3.0
3.0
2.5
3.0
2.5
2.5
2.5
2.5
2.5
3.0
3.0
3.0
2.5
3.0
3.0
2. 75
2.5
2.5
2.5
2.0
2.0
2.0
2. 0

3.0
4.0
3.5
3.5
4.0
4.5
4.5
4.0
3.5
3.0
3.0
3.0
3.0
2.5
2.5
2.0
2.0
2.5
2.0
2.5
2.0
2.0
2.0
2.0
2.0
2.5
2.5
2.5
2.0
2.5
2.5
2.5
2.0
2.0
2.0
1.5
1.5
1.5
1.5

The emphasis laid upon the willingness of the authorities to pay a
fair rate of interest upon the deposits must not be construed to indi­
cate that the interests of those to whom they in turn furnish capital
have been neglected. Nor yet may it be assumed that the rate of
interest upon these deposits is fixed without due regard to the market
rate. Quite on the contrary the constant changing of the rate of inter­
est paid on deposits, as shown by the table, evidences that strict heed
has been paid to the market rate. Following the poor harvests of 1873
and the accompanying financial embarrassment the rate upon yearly
deposits rises from 4J to 5 and afterwards to
per cent. A gradual
decline is shown in 1874, with a slight rise in December. Other slight
fluctuations follow prior to 1878, when the abundance of capital and
general revival of business made a reduction of £ per cent possible, but
the depression of 1881 restored the former rates. With the return of
better times the rate again decreased in 1884, and remained practically




PAWNBROKING IN EUROPE AND THE UNITED STATES.

24S

stationary until May, 1897, when for reasons already stated a slight
reduction in the yearly rate was made. In short, the interest as shown
in the table has mirrored minutely every positive fluctuation in the
money market of the country.
By a decree of February 27, 1811, and in virtue of a royal ordinance
of January 22, 1831, the mont-de-piete is permitted to place funds not
needed for immediate use in the treasury and receive interest thereon.
This disposition of the surplus capital is permitted in order to lessen
the loss the institution would otherwise sustain by paying interest
upon unemployed capital. But a loss is not entirely averted, since, as
previously remarked, the treasury pays about 1 per cent less upon
deposits than the mont-de-piete. Yet the importance of such an
arrangement is evident when it is remembered that the reserve, kept
as a sort of security for depositors, is seldom allowed to fall below
3,500,000 francs ($675,500), and that this sum, supplemented by the
funds not needed for immediate use, often makes a total deposit in the
treasury of some 6,000,000 francs ($1,158,000). The result is that, due to
this loss, the actual rate paid by the mont-de-piete is somewhat higher
than the above table would indicate. To exactly ascertain this rate,
the amount paid the mont-de-piet6 by the treasury has been deducted
from the total sum paid by the mont-de-piete to its depositors. The
results obtained appear in the following table:
A C T U A L Y E A R L Y R A T E OF INTER EST P A ID ON DEPOSITS B Y THE MONT-DE-PI^T^5
OF PARIS, 1877 TO 1896.
Year.
1877
.............................................................
1878..................................................................
1879 .................................................................
1880
.........................................................
1881..................................................................
1882..................................................................
1883
........ ................................................
1884 ................................................................
1885
.........................................................
1886..................................................................

Per cent.
2. 800
2. 720
2. 501
2.480
2.511
2. 729
3.010
2. 811
2. 555
2. 396

Year.
1887................................................................
1888.................................................................
1889...........................................
........
1890.................................................................
1891.................................................................
1892.................................................................
1893.................................................................
1894.................................................................
1895................................................
1896................................................................

Per cent.
2. 394
2. 575
2. 728
2. 779
2. 800
2. 741
2.722
2.701
2. 712
2.698

It will be noted that the rate in 1886 and 1887 was extremely low;
that beginning with 1888 it gradually rose until 1891, after which it
again declined. For some years prior to 1885 the treasury had paid the
mont-de-piete 3 per cent interest on its deposits, a rate which obtained
until 1887, when it was lowered to 2 per cent. The rise of the actual
rate as seen in 1888, as also for the year immediately following, is due
to the lower rate of interest paid by the treasury, while the reduction
in 1892 and following years finds its cause in the introduction of the nine
months’ deposits, a practical lowering of the rate of interest.
The somewhat unsatisfactory relation existing between the mont-depiete and the treasury has led to a discussion of the advisability of
supplanting it by a union with the savings banks similar to that exist­
ing in many cities of Germany. The advocates of the plan argue that



244

BULLETIN OF THE DEPARTMENT OF LABOR.

this method would furnish a safe and profitable employment for the
funds of the savings bank and supply the mont-de-piete with an everready capital. They hold that the savings bank would thus be secure
from loss on its investments, due to which cause it could supply the
mont-de-piete with funds at a lower rate than is obtainable at present.
The opponents of the plan reply that the scheme is not practical; that
in times of depression, when the demands upon the savings bank must
necessarily be heavy, the receipts of the institution will diminish so
that it will be unable to return the funds borrowed, and financial
embarrassment will result to both. In the case of Paris, where the
mont de-piete has no capital of its own, the argument is entitled to
consideration; where, however, as in Germany, a wiser policy as to
capital has been pursued, and the institutions have funds of their own,
the danger is lessened. To make one entirely dependent upon the other
is a mistake; but to allow one to supplement the other within reason­
able bounds is a decided advantage, as the experience of Germany
amply proves. Outside of Paris a few of the French cities have adopted
the plan, but as a rule France has refused to adopt this feature so often
found in German cities.
T H E M O N T -D E -P IE T E A S A S A V I N G S B A N K .

It appears that the mont-de-piete has never directly sought to usurp
the business properly belonging to the savings bank. The nearest
approach to this is the acceptance of the u placements temporaires?? by
the institution of Paris. These temporary deposits, as they may be
called, are deposits made without a fixed date of withdrawal by the
employees of the institution. Each employee is permitted to deposit
funds, large or small, so long as the total amount of his deposits do not
exceed 3,000 francs ($579), and to receive interest on the same at 4 per
cent per annum. As this rate of interest is very favorable to the
employees, many of them avail themselves of the opportunity. During
the year 1896,161,051 francs ($31,082.84) were deposited, making a sum
total of 298,700 francs ($57,649.10) on deposit, of which amount 150,200
francs ($28,988.60) was reimbursed, leaving a balance of 148,500 francs
($28,660.50) on deposit at the end of the year. As the institution
suffers a loss of from 1 J to 2 per cent upon all sums so deposited, it
may be questioned why the plan was introduced. The reason is chiefly
an administrative one. While it is true that in 1833, when such deposits
were first accepted, the facilities for saving were not so plentiful as at
present, and therefore at that time it may have been for the convenience
of the employees, its chief idea was that by cultivating habits of order
and economy among its employees their services would be enhanced in
value; but while not a savings bank in the true sense of the term, it is
interesting to notice to what extent it has become the bank of the small
capitalist, a result obtained not wholly without intent.




PAWNBROKING IN EUROPE AND THE UNITED STATES.

245

The following table gives a comparison of the deposits of 1846 with
those of 1895:
N U M B E R A N D A M O U N T OF DE POSITS A T T H E M O N T -D E -P I^ T ^ OF P A R IS , B Y SIZE
OF D E PO SITS, 1846 A N D 1895.
Deposits.
Year.

Size o f deposit.

Number. Per cent
o f total.

Am ount.

P er cent
o f total.

1846
1895
1846
1895
1846
1895
1846
1895

925
2,347
2, 844
3,927
697
1,356
445
1,079

18.8
26.9
57.9
45.1
14.2
15.6
9.1
12.4

$100,188.42
292, 479. 92
1,183,362.13
2, 058, 316.05
844,529. 40
1, 973, 673. 97
1, 692, 719. 43
6, 941, 949.45

2.6
2.6
31.0
18.3
22.1
17.5
44.3
61.6

T o ta l.................................................................. | 1846
1895

a 4, 901
8, 709

100.0
100.0

3, 820, 799. 38
11, 266,419. 39

100.0
100.0

100 to 1,000 francs ($19.30 to $193).......................... j
1.001 to 5,000 francs ($193.19 to $965).................... {
5.001 to 10,000 franc* ($905.19 to $1,930)............... {
10.001 francs ($1,930.19) or o v e r............................. j

a Tliis is the total shown in the report o f M. Blaize, Des M onts-de-Pi6te, T. II, p. 36, from w hich the
figures were taken, and is not the correct total o f the items given. The per cents for 1846 in the next
column are computed on the basis o f the correct total, 4,911.

From 1846 to 1895 the number of the deposits of 1,000 francs ($193)
or less have increased from 18.8 to 26.9 per cent of the total number ;
deposits of from 1,001 to 5,000 francs ($193.19 to $965) have decreased
from 57.9 per cent to 45.1 per cent, and those of 10,001 francs ($1,930.19)
or over have increased from 9.1 to 12.4 per cent of the total number.
But if the per cent of the total amount deposited is considered, a differ­
ent result is obtained. The acceptance of deposits of 100 francs ($19.30)
instead of 250 francs ($48.25) has not served to increase the per cent of
the total deposited in small amounts. A pronounced decrease is noted,
however, in the per cent deposited in sums of 1,001 to 5,000 francs
($193.19 to $965) and from 5,001 to 10,000 francs ($965.19 to $1,930),
but the deposits of 10,001 francs ($1,930.19) or over have risen from
44.3 per cent to 61.6 per cent of the total deposit.
In the following table the number of deposits aDd the total and aver­
age amount deposited at the mont-de-piete of Paris are given for the
year 1895 by size of deposits :
N U M B E R OF D E PO S ITS A N D T O T A L A N D A V E R A G E A M O U N T D E P O S IT E D A T T H E
M O N T -D E -P I^ T lS OF P A R IS , B Y SIZE OF D E PO SITS, 1895.

Size o f deposit.

Num ber
Per cent
of
deposits. o f total.

A m ount de­
posited.

P er cent A verage
o f total. deposit.

100 to 500 francs ($19.30 to $96.50).....................
501 to 1,000 francs ($96.69 to $193)....................
1,001 to 5,000 francs. ($193.19 to $965)...............
5,001 to 10,000 francs ($965.19 to $1,930).........
10,001 to 20,000 francs ($1,930.19 to $ 3,860)....
20,001 francs ($3,860.19) or ov er........................

947
1,400
3, 927
1,356
624
455

10.8
16.1
45.1
15.6
7.2
5.2

$62,429. 71
230, 050. 21
2, 058,316. 05
1, 973,673. 97
1, 771, 707.19
5,170, 242. 26

0.6
2.0
18.3
17.5
15.7
45.9

$65.93
164.29
524.14
1,455. 51
2, 839. 27
11, 363.17

T ota l.............................................................

8, 709

100.0

11, 266, 419.39

100.0

1, 293.65

In 1895,10.8 percent of the total number of deposits were for sums of
from 100 to 500 francs ($19.30 to $96.50), which amounted to 0.6 per cent
of the total amount deposited, the average deposit being 341.61 francs



246

BULLETIN OF THE DEPARTMENT OF LABOR.

($65.93). The most popular deposits were those of from 1,001 to 5,000
francs ($193.19 to $965), the average deposit in this class being 2,715.75
francs ($524.14), yet constituting but 18.3 per cent of the total amount,
while those of 20,001 francs ($3,860.19) and over formed 45.9 per cent of
the total sums. Among this latter class of deposits were 73 for sums
varying from 50,000 to 100,000 francs ($9,650 to $19,300); 28 varying
from 100,000 to 200,000 francs ($19,300 to $38,600); 17 from 200,000 to
300,000 francs ($38,600 to $57,900); 5 from 300,000 to 400,000 francs
($57,900 to $77,200); 3 from 400,000 to 500,000 francs ($77,200 to $96,500);
9 from 500,000 to 1,000,000 francs ($96,500 to $193,000); 1 for 1,500,000
francs ($289,500); 1 for 2,000,000 francs ($386,000), and 1 for 3,000,000
francs ($579,000).
The number and value of certificates of deposit discounted in Paris
from 1886 to 1896 are shown in the following table:
N U M B E R A N D V A L U E OF C E R T IF IC A T E S OF D E P O S IT D ISC O U N T E D IN P A R IS ,
1886 TO 1896.
Tear.
1886
1887
1888
1889
1890
1891
1892
1893
1894
1895
1896

Number.

..

114
77
86
51
84
74
68
63
66
60
70

Value.
$95, 872. 75
69, 065. 05
166, 391. 09
72, 954.00
149, 816. 25
99. 445.18
106, 765. 67
221, 315. 03
90, 818. 08
96, 704. 58
52, 598. 29

A vera g e
value.
$840.99
896. 95
1, 934. 78
1,430. 47
1, 783. 53
1, 343.85
1, 570. 08
3, 512. 94
1, 376. 03
1,611. 74
751.40

Prior to 1886 it was the rule of the institution not to refund deposits
until the expiration of the period for which they had been deposited.
It was found, however, that this worked hardship to a number of their
depositors. In case of an absolute need of funds prior to the expira­
tion of the period of deposit, their patrons often were obliged to dis­
count their certificates upon most unfavorable terms. A case reported
is that of a merchant paying 360 francs ($69.48) as commission and
discount to a dealer to discount a certificate whose face value was 2,060
francs ($397.58), due November 7 and discounted April 12. This,
together with other similar but less flagrant instances, led the authori­
ties to decide to discount their own certificates, with the results shown
in the above table. As the depositor is permitted to discount his cer­
tificate in whole or in part, the total, as given in the table, furnishes
an inadequate basis for judgment, since it represents the face value of
all certificates presented for discount. It does, however, give a cer­
tain clue to the class of deposits usually discounted, since by compar­
ing the average value of the certificates with the above we find that
the smaller depositors are the ones seeking for discount. It is peculiar
that the number of certificates discounted, as also the amount, does
not show a pronounced decrease after the passage of the law of 1892,




PAWNBROKING IN EUROPE AND THE UNITED STATES.

247

which permits the pledging of these certificates. The fact that they
may be pawned, and therefore perhaps be saved to the owner, does not
seem to have lessened the number or amount presented for discount.
S O U R C E S O F C A P IT A L .

In the following statement is shown the capital of the mont-de-piete
of Paris on March 31, 1896:
Certificates of deposit......................................................................................... $10,800, 529. 31
Security deposited by officials..........................................................................
128, 619.01
Unclaimed surplus.................................................................................................
113,866.89
Advanced by the administrators of the public charities........................
19,121. 52
503, 927.79
Pension fu n d ...........................................................................................................
R eserve.....................................................................................................................
5, 510. 20
Payments on account...........................................................................................
602. 48
Guarantee deposits made by contractors.......................................................
6,122.92
Unpaid interest, appropriations, etc..............................................................
163,438.87
124, 604. 69
Miscellaneous deposits.........................................................................................
T o ta l...............................................................................................................

11, 866, 343. 68

Aside from the funds accepted in deposit, a second source of capital
for the mont-de-piet6 is the security which certain responsible officers
are required to deposit as a guarantee for the proper performance of
their duties. In the early history of the institution this method of
raising capital played a very important role, but by 1850 the reaction
was total. The President of the Republic decided that henceforth these
securities should be placed in the public treasury and directed that the
mont-de-piet6 should at once return the securities they then held. Cash
securities were again required in 1864, and by the law of 1865 the offi­
cers and agents of the mont-de-piet6 are required to deposit their
securities in the treasury of their respective institutions. By the same
law the prefects are given authority to decree that those holding respon­
sible positions in other institutions shall deposit their security in the
treasury of the mont-de-piet6. In like manner the administrators may,
“ if they deem necessary,77 upon authorization by a decree of the prefect,
“ impose on all other employees or minor representatives (agents seeondaires) of the institution an obligation to deposit security as a guaran­
tee for the proper execution of their duties.77
Formerly it was left to the discretion of the prefect to fix the amount
of security that each employee should deposit, but by the law of June
8, 1864, he was relieved of the duty of arbitrarily fixing the amount,
and the present plan adopted. By it the amount of security required
from the cashiers and keepers of the magazines is determined for the
former “ by the average of the amounts loaned upon pawn for the past
three years,77and for the latter “ by the average of the loans represented
by the pawns in the magazine on December 31 of the last three years.77
On the sums thus obtained they must respectively make deposits in




248

BULLETIN OF THE DEPARTMENT OF LABOR.

accord with the following schedule, but in no instance may the amount
be inferior to 1,000 francs ($193):
10 per cent on the first 100,000 francs ($19,300);
3 per cent on the following 400,000 francs ($77,200);
1 per cent on the following 1,000,000 francs ($193,000), and
20 per cent on all sums in excess of the first 1,500,000 francs ($289,500).
When a new mont-de-piete is established the prefect, with the advice
of the council of administration, determines the amount of the security.
It is, however, expressly provided that this temporary deposit is valid
only for the first three years, and that within the first six months of
the fourth year the definite adjustment upon the basis fixed by the law
shall be made. But it is to avoid frequent changes in the amount of
the security due to the increase or decrease of the business that the law
provides that “ a revision of the guaranty deposited by the cashiers and
keepers of the magazines may be made when the sums deposited by
them have, for three consecutive years, been superior or inferior by at
least one-fifth to the amount required as determined by the law of June,
1864.” The same section provides that requests for revision may be
formulated by the treasurer (receveur des finances) of the arrondissement, by the administration of the mont-de-pi6te, or by any officer
required to deposit such security. All such requests must go to the
prefect who authorizes the revision, and in accordance with the law
fixes the sum to which the guaranty must be raised or reduced. Since
1850 the capital so obtained gradually increased to 4^)1,311.83 francs
($77,453.18) in 1886, and at the close of 1896 amounted to 592,837.53
francs ($114,417.64). In other cities, however, the per cent of capital
so obtained is much greater. Rouen secures 23 per cent and Lyons
41 per cent of their capital in this manner. In the latter city it is quite
evident that it is intended to secure as large a sum in this manner as
possible. Article 57 of its constitution reads: “ The sureties in specie,
for the overseers of the institution, for the receivers of the communal
revenues who are not at the same time collectors of direct taxes, for
farmers or administrators of taxes, for the receivers of the asylums and
other charitable establishments, for contractors for supplies for the
department or commune, or in general all sureties which are not ordered
by the laws to be deposited in the State coffers will be employed to
form a part of the capital necessary for the exploitation of the estab­
lishment.”
The item of unclaimed surplus appears in the table since from the time
of sale until claimed by the owners, or, unclaimed, it becomes the prop­
erty of the “ assistance publique; ” any such sums remain with the montde-piete as a part of its capital. The other items given in the table
require but little comment. The amount advanced by the public chari­
ties has gradually reduced from year to year, until but 99,075.25 francs
($19,121.52) was received from that source. The sum under the head
of pensions is a trifle misleading, as it has been made to include not
only the amount due pensioners, but also the value of the bonds whose



249

PAWNBROKING IN EUROPE AND THE UNITED STATES.

revenue provides that sura. The reserve is the sum which, in connec­
tion with the other portions of the capital not engaged in making
advances, is deemed necessary to secure the depositors from probable
loss. The remaining items, save that of miscellaneous deposits, may
be passed without comment. Under this head we have principally
deposits made in guaranty for the payment of the certificates of
deposit lost or mislaid. Its purpose is obvious. A certificate lost or
stolen can not be paid in full until all hope of its presentation is past.
Meanwhile the depositor should not be deprived of the profit accruing
to his capital. As a result, a certain portion of the deposit is paid,
and the remainder, together with other security, is held to secure
the institution in case of fraud. On March 31, 1895, the sum so held
amounted to 285,162.90 francs ($55,036.44). Further, the administra­
tion requires that persons desiring advances of 15 francs ($2.90) or
over must establish their identity before the loan will be given. If
unable to do this, the advance is refused and the article offered in
pawn held until the owner can secure means of identification. As in
some cases the owner or supposed owner fails to return, the pawn
remains in the hands of the mont-de-piet6 subject to its disposition.
While the value of articles so left was oniy 3,922 francs ($756.95),
that sum, with the amounts so left in previous years, and after deduct­
ing reimbursements, gives a balance of 91,965 francs ($17,749.25).
These amounts, together with other deposits, give for miscellaneous
deposits the sum of 645,620.17 francs ($124,604.69), which, added to the
other items given in the table, swell the total capital of the company
on March 31, 1896, to 61,483,646 francs ($11,866,343.68).
The following table gives the receipts and expenditures of the montde-piete of Paris for the year 1896:
R E C E IP T S A N D E X P E N D IT U R E S OF T H E M O N T -D E -P J ^ T ^ OF P A R IS , 1896.
Expenditures.

Receipts.
Item s.

A m ount.

Capital on hand at beginning o f yearin terest received from redemptions,

$10,681. 28

renewals, and 3ales...........................

A u ction fees............................................
A m ount acquired b y prescription . . .
Interest on funds in treasury.............
R ents r e c e iv e d .......................................
A m ou nt refunded on insurance.........
D iscoun t on certificates o f d ep osit-..

Miscellaneous...................................

Total

9986—No. 21------6



726, 519.89
11, 793.56
11, 906. 99
18,155. 22
4,143. 61
4, 937. 35
613. 72
1, 032. 23

789, 783. 85

Item s.

A m ount.

Interest p a id .........................................
Fees for appraisal and auction.........
Salaries and wages for immediate
service .................................................
Salaries o f architect and physicianR ent for director’s d w e llin g .............
W ages for extra w ork, police, etc ..
Pensions..................................................
Office e x p e n s e s .....................................
W ater and telephone r e n t .................
F ire insurance.......................................
Transportation o f p a w n s ...................
Contribution to em ployees’ benefit
s o c ie tie s ..............................................
Building and repairs............................
M iscella n eou s.......................................
Funds on hand.......................................

$306, 503.85
54, 034.28

T o t a l ............................................
B alance....................................................

756,428.67
33, 355.18

T o t a l ............................................

789,783.85

274, 986. 40
772.00
772. 00
18, 658.27
15, 440.00
22, 783. 54
1,562.72
4,774.06
5,449.16
482. 50
18, 899.10
20, 629. 52
10, 681.27

250

BULLETIN OF THE DEPARTMENT OF LABOR.

The interest received from redemptions, renewals, and sales in 1896
amounted to 3,764,351.75 francs ($726,519.89), which together with the
interest paid the institution by the treasury on funds deposited with it
and other smaller receipts made a sum total of 4,092,144.31 francs
($789,783.85). But in that it was necessary to pay out nearly 39 per cent
of this amount as interest on borrowed funds, the actual profit was
only 172,824.79 francs ($33,355.18), or 0.31 per cent of the amount
loaned.
The profits, unclaimed surplus, and per cent of profit on the amount
loaned by the montde-piete of Paris for the years 1870 to 1896 are
shown in the following table:
P R O F IT S , U N C L A IM E D SU R PLU S, A N D P E R C E N T OF P R O F IT ON A M O U N T L O A N E D
B Y T H E MONT-DE-PH&T3S OF P A R IS , 1870 TO 1896.

Year.

1870.
1871.
1872.
1878.
1874.
1875.
1876.
1877.
1878.
1879.
1880.
1881.
1882.
1883.
1884.
1886.
1890.
1895.
1896.

A m ount
loaned.
$7, 904,185. 50
5, 770,984.10
7, 717,182.78
8, 814. 845. 00
9, 882,210. 57
9,484, 970.53
9, 864, 840. 85
9, 938,983. 73
9, 770,177. 24
10,106,796.84
10,155, 514. 67
10, 213,151. 23
11,079, 616.04
11,190, 387. 81
11,029,171. 05
10, 576,708. 61
11,197, 743.04
10, 071, 967.48
10, 807, 048. 70

Profits
from
business.

$3, 599.96
132,328.43
126,121. 54
114,926.65
149,406.39
154, 608.54
99,958. 26
148, 331.20
135, 372.18
171,763. 81
99,495. 77
112. 978.17
185,161. 68
1, 099. 80
10, 681.27
33, 355.18

Unclaimed
surplus, (a)
$33,477. 62
33, 789.65
29, 854. 78
37,836.47
51,681.91
54, 801.06
34,017. 25
31,469. 82
28, 742. 82
28,813.51
28, 794.19
29, 974. 31
40, 070. 06
35,150. 27
35,221.12
31, 328. 85
32, 389.40
18, 814. 63
19,121.52

Total
profit.

L oss.

$33,477. 62 $49,922. 69
37, 389.61
162,183.21
37, 836. 47 39, 361.91
51, 681. 91
2, 089. 85
180, 922. 60
148,943.90
180, 876. 21
183, 351. 36
128, 771.77
177,125.39
165,346.49
211, 833. 87
134, 646. 04
148,199.29
216,490.53
33,489. 20
29, 495.90
52,476. 70

P er
cent o f
profit.

0.65
2.10
.55
1. 91
1.51
1. 82
1.88
1.27
1.74
1. 62
1.91
1. 20
1. 34
2.05
.30
.29
.49

a The unclaim ed surplus for any given year, as shown in this column, is derived from pledges
received five years previous.

Without seeking to account for the yearly fluctuation in the profits
of the business by giving an itemized account, as in 1896, we may in
general attribute the marked decline in 1883 and 1884 to the crisis of
1882, and the very marked decline in 1890 to the lowering of the rate
o f interest in 1887 from 8 per cent per annum with \ per cent as a fixed
fee to 6 per cent per annum with a fixed fee of 1 per cent, and the
exemption of interest on advances of 5 francs ($0,965) or less which
remain unpaid for less than two months from all charges save the fixed
fee of 1 per cent. In like manner we may assume that the rise of
profits in 1895 and 1896 was the result of the law of 1892, allowing
bonds, stocks, etc., to be taken in pawn.
The second source of profit is the unclaimed surplus. As previously
stated, any surplus arising from the sale of unredeemed pledges is held
for three years subject to the demand of the owner, but if not claimed
within that time becomes the property of the mont-de-piete. As a rule,
however, it is four or five years from the date of the sale before the
surplus is actually taken by the authorities. For example, the surplus



PAWNBROKING IN EUROPE AND THE UNITED STATES.

251

arising from the sale of unredeemed pledges in 1865 was not taken
until 1870, and it will be seen from tbe table that five years is the usual
period.
Lastly, counting the regular profit and the surplus for the several
years, we find the per cent of gain on the total amount loaned has, due
to the reduction in the rate of interest, been reduced to less than \
per cent.
ENGLAND.
England’s experience in pawnbroking forms the connecting link
between the Continental countries and the United States. Like the
Continental countries she suffered from usury and sought to free her­
self by legal means, but like the United States her authorities have
not seen fit to adopt the municipal systems which prevail on the Con­
tinent. As early as 1199 Richard I fixed 10 per cent per annum as the
legal rate of interest, yet the Jewish brokers continued to charge from
45 to 65 per cent, a rate which, with other excesses, led to their expul­
sion in 1290. The Lombards succeeded to the business, but, while
being of real service to the commercial interests of the country, were
also expelled in 1530. From this date the English themselves took up
pawnbroking, and so rapidly did the number of brokers increase that
James I promulgated a law for the “ abolishing of the idle and needless
trades and upstart brokers,” assigning as a reason for the act that they
encouraged theft, and that the excessive profits made led many to for­
sake their manual occupations to become brokers. As a remedy, pawn­
brokers were forbidden “ by any means whatsoever” to “ work or make
any change or alteration of the property” received by them, and any
attempt to conceal stolen property worked the forfeiture of twice the
value of the article in question. But the measure was inadequate, and
it remained for Charles II, William III, and, later, George I, to try
various plans before even a partial success could be obtained.
The constant failure of the early laws to regulate the pawning of
merchandise led to a general movement favoring the formation of “ loan
banks,” based upon the plan of the Continental pawnshops. Yet no
definite action was taken until the reign of Anne, when the principal
advocates of the plan formed a “ Charitable Corporation,” which, although
securing a charter in 1708, did not begin business until 1719. From
the first, dividends of 10 per cent were regularly declared, but soon it
was sarcastically remarked that “ the poor tradesmen must be very
industrious to have any transactions with the Charitable Corporation
for the relief of the industrious poor, not to be undone.” Not only did
it become simply a dividend-yielding institution, but so questionable
was its conduct that Parliament was asked to interfere, and before the
inquiry ended two members of the House were expelled and many per­
sons in high places compromised. So ignominious was the failure that
no representative of this class of institutions has since been able to
gain a foothold on the soil of England proper. Indeed, for almost a



252

BULLETIN OF THE DEPARTMENT OF LABOR.

hundred years no further attempt was made to supplant the private
pawnshop. But with the spirit of speculation rife in 1824 and 1825, the
“ Equitable Loan Bank of London,” which proposed to loan small sums
at 5 per cent per annum, sought, but failed, to secure a charter. Again,
in 1838, Parliament refused to recognize the “ British Pledge Company,”
and in 1856 similar attempts met the same fate.
The failure of the Charitable Corporation, however, was not without
a beneficial influence. It silenced the advocates of philanthropic pawnbroking, and led to the belief that instead of attempting to graft a
foreign system upon the English soil it was wiser to perfect the one
already in vogue. To this end the laws were repeatedly changed or
temporarily enacted until 1800, when the clauses which had proven
satisfactory in preceding legislation were embodied in a general law,
under which the business was conducted for seventy-two years. Dur­
ing this time, however, the law was subject to slight changes. In 1815
the price of the license was raised from £10 to £15 ($48.67 to $73) for
London and its suburbs, and from £5 to £7 10s. ($24.33 to $36.50) for
the country districts. Yet in addition to this, those who wished to
take gold and silver plate or jewelry in pledge were required to secure
a “ plate” license at an additional cost of £5 15s. ($27.98), thereby rais­
ing the license fee to £20 15s. ($100.98) for London and £13 5s. ($64.48)
for the country districts, a rate which obtained until 1872, when the
present uniform fee of £7 10s. ($36.50) was fixed. The additional cost
for the license, together with the small profit allowed on pledges of low
value (wee pawns), led to a marked increase in the number of “ dolly
shops” or “ leaving shops,” places where objects were sold with the
option of repurchase at an advanced price within a certain fixed time.
In this way any rate of interest could be charged without violation of
the law, and the plan, especially in London, where the license was
highest, was exploited to its fullest extent. To remedy this defect the
statutory definition of the pawnbroker was extended in 1856 to include
this class of trade, and three years later the brokers were permitted to
make loans of over £10 ($48.67), thus giving an opportunity to do a
lucrative business in a field heretofore denied them.
T H E L A W O F 18 72 .

The act of 1800 was successful in meeting the demands of that period,
but as conditions changed, with the later developments in all lines of
enterprise, its provisions gradually became less and less satisfactory.
The pawnbrokers found the profit-limiting clauses in direct opposition
to the principle of free trade, so often sanctioned by the Government.
They complained that the sections which prescribed uniform hours in
all parts of the country were productive of much inconvenience. Other
portions of the act had fallen into disuse, while some operated only to
the detriment o f those desirous of obeying the law. Moreover, adopted
for the purpose of protecting the pawner from extortion, it was proved



PAWNBROKING IN EUROPE AND THE UNITED STATES.

253

that its provisions, like those of the usury acts, defeated their own
object. Bulky goods were still unpledgeable, because the statutory
profit was insufficient to cover the cost of storing, while a judicial deci­
sion upon the precise mode of calculating the rate of interest on small
sums had necessitated resort to elaborate and complex tables designed
for its calculation. The clause which, perhaps, gave greatest offense
required the pawnbroker to restore without compensation any object
stolen or otherwise unlawfully obtained and placed in pawn. The
brokers argued that at times the plausibility of rascals deceived even
those most desirous of doing a legal business, and thus, due to no fault
of their own, compelled them to lose their original loan and accrued
interest. The law provided no means whereby the owner of stolen
articles should share the loss of the pawnbroker, although the former
might have been most negligent and the latter have taken due precau­
tion. It was also asserted that unprincipled men allowed their prop­
erty to be pawned by a second party, and upon its return divided the
spoils with the one who had originally pawned the article. Further,
the pawner objected to the regulations for the redemption of goods in
case the pawn ticket was lost. On such occasions the loser procured a
declaration blank from the pawnbroker and, after filling it out, was
required to present himself before a justice of the peace, who, if the
evidence given convinced him that the alleged owner was the rightful
owner, attached his signature to the blank, thereby giving the owner
authority to redeem his property. But unfortunately it was often the
case that the justice attached his signature to the blank and pocketed
the shilling fee (24 cents) without questioning the applicant. The proc­
ess was so simple that rogues, seizing the opportunity, began to present
declarations and to redeem property of which they had sufficient
knowledge to describe, thus making the tickets held by the rightful
owners absolutely worthless.
For these and other reasons the law became so unpopular that in 1871
a select committee was appointed by the House of Commons u to inquire
into the law affecting the pawnbroking trade, with a view to its consoli­
dation and amendment.” The committee, after hearing a great amount
of evidence, reported to the effect that the laws were in such an unsat­
isfactory state that they ought to be wholly repealed and a general
law be enacted regulating the pawnbroking business.
The report of the committee was incorporated in the act of 1872,
according to whose provisions the business is now conducted. That
the “ dolly-mau” may be effectually excluded, a pawnbroker is defined
to be any person keeping a shop for the purchase of goods or chat­
tels, or taking the same as security for money advanced thereon, or
anyone who purchases, receives, or takes in goods or chattels and pays
or advances or lends thereon any sum of money not exceeding £10
($48.67) with any sort of an understanding, expressed or inferred,
that they will afterwards be redeemed or purchased on any terms.



254

BULLETIN OF THE DEPARTMENT OF LABOR.

Within the metropolitan area any pawnbroker holding a license at the
time of the passage of the act is simply required to have his license
renewed annually by the magistrate sitting in any police court having
jurisdiction within the district. Without the metropolitan area the
renewal of licenses is in the hands of the justices convened for that pur­
pose. If, however, a license had not been previously secured, the would-be
broker must notify the overseers of the poor and the superintendent of
police of his intention to make application for a license. This notifica­
tion must be made at least twenty-one days prior to his application, while
twenty-eight days prior to it he must cause a like notice to be fixed and
maintained between 10 a. m. and 5 p. m. on the principal door, or one of
the doors, of the church or chapel of the parish, or in some other con­
spicuous place, for two successive Sabbaths. If after this notice no
sufficient evidence is produced against the good character of the appli­
cant, and the shop in which he intends to carry on his business or any
adjacent house or place is not frequented by thieves or persons of bad
character, a license may be issued.
By the provisions of the act the pawnbroker is forbidden to accept
any article in pawn without giving the owner a ticket bearing the date
and description of the article pawned, amount advanced, the owner’s
name and address, as also the name and address of the pawnbroker.
Further, the ticket must have printed upon it the stipulations of the
law as to the profits allowed the broker and the conditions as to the sale
of the pledges. On advances of less than 10s. ($2.43) a charge of Jd.
(1 cent) may be made for the ticket; on sums of over that amount,
Id. (2 cents). An interest charge of £d. (1 cent) per calendar month for
each 2s. (49 cents) or fraction thereof loaned is allowed on all sums of
less than 10s. ($2.43); on sums of over 10s. ($2.43), Id. (2 cents) per
month for every 2s. 6d. (61 cents), provided the sum does not exceed
40s. ($9.73), in which case a special pawn contract may be made upon
such terms as the contracting parties consent to. In all cases interest
is to be reckoned for at least one month, but after the expiration of the
first month any period of fourteen days or less shall be reckoned only
as a half month, and any period of over fourteen days, as an entire
month. All loans are made for one year, at the end of which time
seven days grace are allowed in which the pledges may be redeemed,
but if not redeemed within that period, all those upon which an advance
of 10s. ($2.43) or less has been made become the absolute property of
the pawnbroker, while those over that amount are to be sold at auction.
Any surplus arising from the sale of an unredeemed pledge, after loan
charges and cost of sale have been met, is held for three years subject
to the demand of the rightful owner. If, however, pledges belonging to
the same person are sold within twelve months of each other, one failing
to pay the loan and charges and the other giving a surplus, the pawn­
broker is permitted to appropriate such a portion of this sum as
is necessary to make good the deficit. On the other hand, that the
pledgers may secure any sum due them, any holder of a ticket upon



PAWNBROKING IN EUROPE AND THE UNITED STATES.

255

which an advance of over 10s. ($2.43) has been made is permitted to
examine the entry of the sale as it appears in the pawnbroker’s books
and the filled-in calendar of the auction, which is authenticated by the
signature of the auctioneer.
If a ticket is lost, mislaid, or otherwise misplaced, the owner may
secure a so-called declaration from the pawnbroker, which, after being
duly signed in the presence of a justice by the applicant and the person
identifying him and returned to the broker within three days, serves
all the purposes of the original ticket. While the plan is almost iden­
tical with that of the former law, the broker is protected in that under
the present law deceit on the part of those interested is made an offense
against the act. In case of loss of pawn by fire, the pawnbroker is
bound to pay the value of the pledge, after deducting the amount of
the loan and the profit, such value to be the amount of the loan and
profit plus 25 per cent of the loan; and if, through fault, neglect, or
willful misbehavior of the broker, the pledge is shown to have been
rendered of less value than it was at the time of pawning, the court is
given power to accord such damages as seem fit. Further, the pawn­
broker is prohibited from receiving pawns from persons intoxicated, or
of less than 12 years of age; from employing servants or apprentices
under 16 years of age; from purchasing, under any pretense whatever,
a pawn except at regular auction, or permitting any pledge to be
redeemed with a view to purchasing it, or making arrangements for the
purchase or sale of a pawn any time prior to its redemption. It is also
illegal to receive pawns on the Sabbath, Good Friday, or any day
appointed for public fasting, humiliation, or thanksgiving. For know­
ingly receiving in pawn unfinished goods, or any materials intrusted to
any person to wash, scour, mend, iron, manufacture, work up, or finish,
the pawnbroker is liable for the restoration of the pledge, and to for­
feit a sum not exceeding twice the amount of the loan. Moreover,
articles unlawfully pawned or pawned without the authorization of the
owner may be obtained by him upon payment of the sum advanced, a
portion, or none of it, as the court may think proper. A t the same
time the pawnbroker is not without protection. Persons unable to give
a satisfactory account of the means whereby they came into possession
of a pawn, or giving wrong information as to the same, are liable to a
fine of not over £5 ($24.33), such a portion of which as the court may
think fit to go to the person who secures the conviction of the offender.
If an informant brings a case against a pawnbroker upon insufficient
evidence, he is subject to a fine by the court, who may stipulate that a
certain portion of it be paid to the pawnbroker for the expense and
trouble caused him by the case. On the other hand, the pawnbroker
is liable to a fine of £10 ($48.67) for a violation of the act, and where
the complainant is the aggrieved party half of this fine may be paid
him, or, if not the aggrieved party, the court may compensate him as
it thinks fit.



256

BULLETIN OF THE DEPARTMENT OF LABOR

THE UNITED STATES.
S T A T E L A W S G O V E R N IN G P A W N B R O K IN G .

“ Of the history of pledges or pawns in the United States,” as Tyler
in his work on Usury remarks, “ there is but little of interest recorded
or to be found in books upon the subject. The practice of pledging
personal property for the security of claims dates back to the earliest
settlements in the country, and the regular business of pawnbroking
has been carried on as long, sometimes without the express sanction of
statute except as is regulated by the authorities of cities, or generally
controlled by rules enforced according to the common law.” Yet it is
pot surprising that legislators did not take action at an earlier date
or that several States are without any very comprehensive regula­
tions on the subject. Not until the great increase of urban population
has there been any direct need of such legislation. Even to-day the
great bulk of our citizens are in rural districts or towns with a popula­
tion insufficient to call for such an enterprise. The business of the
pawnbroker requires not only an urban population, but a dense urban
population, such as is found in great centers of industry. This fact
has made the business one of local rather than one of general interest,
a municipal rather than a State problem, and accounts for the lack of
legislation upon the subject. When one remembers that outside of the
North Atlantic section there are but few States with even two cities of
sufficient size to support the business, it is remarkable that so many have
taken comprehensive action on the subject as are shown in the accom­
panying tabulation of the State laws governing pawnbroking. A t the
same time it must be admitted that even where laws have been passed
their own inconsistencies often render them useless. For instance, the
laws of New Mexico and New York fix a rate of interest, but do not
limit the extra charges that may be levied. Again, several States have
adopted the very commendable feature that any surplus arising from
the sale of unredeemed pledges shall be returned to the owner, but
render the clause practically ineffective by making no provision as to
the amount of charges or as to how long the pawn may be held prior
to sale.
Before considering the actual provisions of the several State laws,
it may be best to first decide just who is entitled to be called a pawn­
broker. Only a few of the States give a concise definition, but of
these perhaps the best is that given in the laws of the District of
Columbia and the State of New York, by which “ any person, corpo
ration, member or members of a corporation or firm who loan money
on deposits or pledge of personal property or other valuable thing
other than securities or printed evidence of indebtedness, or who deals
in the purchasing of personal property or other valuable thing on con­
dition of selling the same back again at a stipulated price,” is declared
and defined to be a pawnbroker. In line with this definition is the



PAWNRROKING IN EUROPE AND THE UNITED STATES.

257

provision in the law of Colorado to the effect that uall purchase of
personal property by pawnbrokers, in the course of their business,
with an agreement, express or implied, to resell the same, shall prima
facie be considered loans within the meaning of this act ’7 [regulating
pawnbroking]. The commendable feature of this definition is that it not
only declares those who loan money upon a pledge of personal prop­
erty to be pawnbrokers, but also those who buy property on condition
of selling it back again at a stipulated price, thereby securing freedom
from the ills that England and Germany experienced at the hands
of the udolly-man” and uRiickkaufshandler.” In Illinois and other
States, however, where the pawnbroker is “ a person loaning money on
the pledge of personal property,” this safeguard is lacking, and but for
the active interference of the municipal authorities the cities of these
States would have an additional drain upon their resources. Fortu­
nately, however, this failure to define or this inadequate definition of
the term has not led to ill results, since the municipal authorities have
usually covered the defect by their ordinances.
The following table shows the principal provisions of the laws of the
various States governing pawnbroking:
ST ATE L A W S GOVERNING P AW N BR O K IN G .

State.

A nnual
license fee.

A1a,h a m a _ __ .

$50

A rizona . . . . ___ _

120

A rkansas...............
C a lifo rn ia .............

(a )

Colorado.... ............

(a)

Bond.

M onth­
ly rate
o f in ­
terest
(per
cent).

Charges.

4
2

F orb id d en . . .
F orb id d en __

a 10 to 50
25 I $1 ,666

6 25
8

F orb id d en . . .
(d)

3,000

3

(a)

I llin o is ...................
(a)
In d ia n a ................. a 10 to 100
Iow a . . . . . . . . ____
( cl)
K a n s a s ................
(a)
300
K e n t u c k y .............
1, 000
L ouisiana...............
(e)
j...............
(a)
M a in e .....................

3

F orb id d en __

D istrict o f Colum ­
bia.
F lo r id a ...................
G eorgia...................
Id a h o .......................

M aryland...............
M assachusetts-----

(a)

100

i50

(h)
i 300

Disposition
o f surplus.

A uction

Returned to
owner.
Returned to
owner.

A u ction
G months
6 months ..

A uction

1 year ........ A u ction

100
50
200

<7100

Method
o f sale.

F orb id d en __

3

C o n n e c ticu t.........
Delaware ( c ) _____

12)

Length o f
loan.

Returned to
owner.
Returned to
j owner.
1

Returned to
owner.
Returned to
owner.

A u ction

Returned to
owner.

A u ction

R eturned to
owner.

A uction

Returned to
owner.

!

F o r b i d d e n __

(/)
(a)

4 m on th s...
I

a T o be fixed by m unicipality.
6 Annual rate.
c A pplies to N ewcastle County only.
d3 per cent per month for not more than 6 months on property requiring care.
e $375 i f capital in use is less than $50,000: $500, i f $50,000 or more.
/ 25 per cent per annum on loans not exceeding $25; 6 per cent per annum on loansoforexceeding$25.
g $500 in Baltimore, w hich is paid to the State.
6. $10,000 in Baltimore.
i A p plies only to cities and towns o f 10,000 population or over; in other places license fee is $2 and
no bond is required.




258

BULLETIN OF THE DEPARTMENT OF LABOR.
S T A T E L A W S G O V E R N IN G P A W N B R O K IN G —Concluded.

State.

Annual
license fee.

M ich ig a n ...............
M in n esota .............
M ississip p i...........
M issou ri.................
M ontana.................
N ebraska...............
N e v a d a ...................
N ew H am pshire..
N ew J e r s e y .........

Bond.

M on th ­
ly rate
o f in ­
terest
(per
cent).

Charges.

Length o f
loan.

M ethod
o f sale.

Disposition
o f surplus.

1 year.........

A u ction

R eturned to
owner.
R eturned to
owner.
Returned to
owner. (e)

(a )

(a)
$100
(a)

2
3

F orb id d en __
F orb id d en __

(a)
d2

Forbidden . . .

220
(a)

(a)
400

(a)

c$2, 000

( b)

N ew M ex ico.

250

N ew Y o r k .. .

c500

10
c 10, 000

50
N orth Carolina . . .
N orth D a k o ta ___
(a)
O h io.........................
<9
O k la h om a .............
(a)
Oregon
(a)
Pennsylvania (h) J i 100 to 300

)

(a)

W a s h in g to n __
W e st V irgin ia .
W iscon sin (s)..
W yom in g..........

(a)

1 year (e). . .

(/)

A uction
(e)

500
1,000

R hode Isla n d ........
(m )
South Carolina . . .
(a)
South D a k o t a ----(a)
T en n essee............. n 10 to 150
150
T exa s......................
U tah.........
V erm ont .
V ir g in ia ..

6 months - .. A u ction

96

5 per c e n t (k). 8 m onths (l) A u ction

Returned to
owner.

A u ction

Returned to
owner, (o)

A u ction

Returned to
owner.

2,000

1,000

p 2, 500

(q)

(r)

1

500

(a)
I

a T o he fixed b y m unicipality.
b In cities not to exceed $150, to be fixed b y m u nicip ality: outside o f cities, $50.
c A p plies to cities o n ly ; outside o f cities, $1,000.
d A p plies to cities o n ly ; outside o f cities not more than 25 per cent per annum on sums not exceed ­
in g $25 and not more than 6 per cent per annum on sums o f more than $25.
e A p plies only to cities o f 200,000 population or over.
/ O n sums not exceeding $100, 3 per cent per month for first 6 months and 2 per cent per month
th erea fter; on sums over $100, 2 per cent per month for first 6 months and 1 per cent per month there­
after. A p plies only to cities o f 200,000 population or over.
g N ot to exceed $150, to be fixed b y m unicipality.
h A p plies to Philadelphia only.
i A ccord in g to amount o f annual business.
j A nnual rate.
A; Per month.
14 m onths only for clothing and dry goods,
m N ot less than $50, to be fixed b y m unicipality.
n A ccord in g to population.
o l f demanded within 30 days from date o f sale; i f not, then to county.
p A p plies to H enrico County only.
q N ot over 10 per cent on amounts o f $25 or less, not over 5 per cent on amounts over $25 and less
than $100, and not over 3 per cent on amounts o f $100 or m ore; applies to H enrico C ounty only.
r2 per cent per month for first 3 months only for storage o f certain enumerated articles; applies to
H enrico C ounty only.
a A pplies to M ilwaukee only.

The following are citations of the laws where the provisions of the
above table and its accompanying text are to be found:
Alabama— Code of 1896, Vol. I, Civil, secs. 950, 3245, 3246, and 4122, subsec. 32.
Arizona—Revised Statutes, 1887, sec. 2239, and Penal Code, 1887, secs. 557 to 561, inc.
Arkansas— Digest, 1894, secs. 5132 and 6460.
California— Codes and Statutes, 1886, Vol. I, Political Code, sec. 3380, subsec. 4, and
Vol. IV, Penal Code, secs. 338 to 343, inc.
Colorado— Chap. 66, acts o f 1897.
Connecticut— Chap. 179, acts of 1895.




PAWNBROKING IN EUROPE AND THE UNITED STATES.

259

Delaware— Chap. 374, acts of 1897.
District of Columbia— Chap. 413, acts of 1888-89 (2d sess. 50th Cong.), amended bychap. 531, acts of 1890-91 (2d sess. 51st Cong.).
Florida— Chap. 4322, acts of 1895, sec. 9, subsec. 9.
Georgia— Act no. 132, page 21, acts of 1896, sec. 2, subsec. 24.
Idaho— Revised Statutes, 1887, secs. 1645, 3423, and 3426.
Illinois— Annotated Statutes, 1896, chap. 74, par. 15, and chap. 120, par. 31.
Indiana— Annotated Statutes, 1894, sec. 4313.
Iowa— Annotated Statutes, 1884, sec. 463.
Kansas— General Statutes, 1889, pars. 555, subpar. “ third,” 804, and 973.
Kentucky— Statutes, 1894, secs. 3787 to 3794, inc., 4057, and 4224.
Louisiana— Revised Laws, 1897, page 837, sec. 5.
Maine— Revised Statutes, 1883, chap. 35, secs. 1 to 5, inc.
Maryland— Code of Public General Laws, 1888, art. 56, sec. 19, and Code of Public
Local Laws, 1888, art. 4, secs. 655 and 656.
Massachusetts— Public Statutes, 1882, chap. 102, secs. 32 to 37, inc., and 124, and
chap. 497, acts of 1895.
Michigan— Annotated Statutes, 1882, sec. 2555, subsec. “ twelfth.”
Minnesota— Statutes, 1894, sec. 1299.
Mississippi— Chap. 5, acts of 1898, secs. 60, etc.
Missouri— Revised Statutes, 1889, chap. 124.
Montana— Codes and Statutes (Sanders7 Edition), 1895, Political Code, secs. 3310,
3316, and 4062, and Penal Code, secs. 621 and 622.
Nebraska— Compiled Statutes, 1895, secs. 997,1181,1393, and 1571, and chap. 10, acts
o f 1897, sec. 159.
Nevada— Chap. 99, acts of 1891, sec. 115.
New Hampshire— Public Statutes, 1891, chap. 50, sec. 10.
New Jersey— General Statutes, 1895, page 2444, secs. 1 to 23, inc.
New Mexico— Compiled Laws, 1897, secs. 2680 tto 2684, inc., and 4145.
New York— Chap. 339, acts of 1883, chap. 363, acts of 1884, and chap. 240, acts of
1890; also chap. 326, acts of 1895.
North Carolina— Chap. 168, acts of 1897, sec. 33.
North Dakota— Revised Codes, 1895, sec. 2148, subsec. 30.
Ohio— Revised Statutes, 1896, secs. 4386 to 4396, inc.
Oklahoma— Statutes, 1893, sec. 577.
Oregon— Acts of 1893, page 129, sec. 25.
Pennsylvania— Digest, 12th Edition, page 1650, secs. 1 to 13, inc.
Rhode Island—General Laws, 1896, chap. 105.
South Carolina— Revised Statutes, 1893, Yol. I, Civil Statute Laws, sec. 1572.
South Dakota— Chap. 37, acts of 1890, art. Y, sec. 1, subsec. 30.
Tennessee— Chap. 2, acts of 1897, sec. 4.
Texas— Revised Statutes, 1895, arts. 3636 to 3652, inc., and chap. 18, acts of 1897.
Utah— Compiled Laws, 1888, Yol. I, part 2, sec. 346.
Virginia— Chap. 450, acts of 1883-84, and chap. 741, acts of 1895-96.
Washington— Statutes and Codes, 1891, Yol. I, General Statutes, sec. 520, subsec. 33,
558, 636, subsec. 10, and 673, subsec. 10.
West Virginia— Code, 1891, chap. 32, secs. 50 and 76.
Wisconsin— Chap. 337, acts of 1887.
Wyoming— Revised Statutes, 1887, sec. 1446.

L i c e n s e s .—From the foregoing table it will be seen that in but one
State—Vermont—has the legislature failed to pass some law on the
subject of pawnbroking, although the only provision thereon made by
many of the States is to give the power of regulating pawnbroking to
the municipalities. Two general plans seem to have been followed in




260

BULLETIN OF THE DEPARTMENT OF LABOR.

reference to licenses. In the first, the annual license fee is to be fixed
by the municipalities, and the money collected therefrom goes into their
treasuries, and in the second the fee is fixed by State legislation,
although the money collected therefrom goes variously into the treas­
uries of the State, county, and municipality. In the first class, where
the municipality fixes the amount of the fee, we find the following
States: Arkansas, Colorado, Connecticut, Illinois, Indiana, Iowa, Kan­
sas, Maine, Michigan, Minnesota, Missouri, Nebraska, New Hampshire,
New Jersey (in cities), North Dakota, Ohio, Oklahoma, Oregon, Khode
Island, South Carolina, South Dakota, Utah, Washington, and W is­
consin (Milwaukee). Of these States, in Connecticut, Indiana, New
Jersey, Ohio, and Rhode Island the limits of the amount of the fee
are definitely fixed by the State law, but within these limits it is to be
fixed by the municipalities. New Jersey is in this class only in so far
as its cities are concerned, and for pawnbrokers located outside of cities
the fee is definitely fixed by the State law. In Wisconsin the law
applies only to the city of Milwaukee.
In the second class, where the fee is definitely fixed by the State law,
the following States are found: Alabama, Arizona, California, Delaware
(Newcastle County), District of Columbia, Florida, Georgia, Idaho,
Kentucky, Louisiana, Maryland, Massachusetts, Mississippi, Montana,
Nevada, New Jersey (outside of cities), New Mexico, New York, North
Carolina, Pennsylvania (Philadelphia), Tennessee, Texas, Virginia,
West Virginia, and Wyoming. In Delaware the law applies only to
Newcastle County and not to the rest of the State. In Louisiana the
license fees are fixed in amounts as follows: $375 per annum if capital
in use is less than $50,000, and $500 per annum if it is $50,000 or more.
In New Jersey the fee is fixed by the State law only for localities out­
side of cities. In New York the law applies only to cities of 200,000
population and over. The State legislation of Pennsylvania which
regulates pawnbroking applies to the city of Philadelphia only, and in
said city the license fees are fixed as follows: $100 per annum on an
annual business of less than $10,000, $200 per annum on an annual
business of $10,000 or more but less than $20,000, and $300 per annum
on an annual business o f $20,000 and upward. In Tennessee the fees
are fixed as follows: $150 per annum in cities, towns, or taxing dis­
tricts of 30,000 population or over; $125 per annum in cities, etc., of
from 8,000 to 30,000 population; $75 per annum in cities, etc., of from
5,000 to 8,000 population; $50 per annum in cities, etc., under 5,000
population, and $10 per annum in taxing districts outside of cities.
In many, if not all, of the States, the second-class cities, either under
their charters or by authorization of general State law regulating the
government of cities, etc., have the power to license pawnbrokers and
to fix a fee therefor, which may be either additional to the fee fixed by
the State law or maybe in lieu thereof.
B o n d .—The law of but few States requires a bond to be given by a
pawnbroker at the time he obtains his license, and of these States but



PAWN BROKING IN EUROPE AND THE UNITED STATES.

261

one—Colorado—leaves the amount of the bond to be fixed by the
municipality. In the others the amount of such bond is definitely fixed
by the State law.
Interest, Charges, etc.—In those cases where the law has con­
sidered interest and charges we may distinguish three classes—those in
which the law provides for interest and charges are prohibited; those
providing for interest with no reference to charges, and those providing
for both interest and charges. In the first class the rate of interest
ranges from 6 per cent per annum on loans of $25 or over in Maine, and
2 per cent per month in California, Missouri, and New Jersey, to 4 per
cent per month in Arizona; for the second class, embracing New Mexico
and New York, the rate of interest in the latter (for cities of 200,000
population or over) is 3 per cent per month for first six months and 2
per cent thereafter on sums not exceeding $ 100, and 2 per cent per
month for first six months and 1 per cent thereafter on sums over $100,
and in New Mexico 10 per cent per month; while for the remaining class
the rate ranges from 8 per cent per month interest, with 3 per cent
monthly charges for the first six months, in Delaware (Newcastle
County) to 10 per cent per month interest and 2 per cent per month
charges in Virginia (Henrico County).
Sale of Pledges and Disposition of Surplus.—The provisions
for the sale of unredeemed pledges and the disposition of the resulting
surplus vary widely in the several States. In the majority of instances
no provision as to the sale of the pledges has been made, leaving the
matter in the hands of the municipal authorities or to the pleasure of
the pawnbroker. In thirteen of the States it has been provided that the
sale shall be by public auction, and in connection with other States a
few additional directions as to sale have been given. The laws of Ari­
zona, California, and Colorado provide that no pledge may be sold for
six months after the date fixed for its redemption. In Kentucky, Maine,
Rhode Island, and Utah this period is three months, in Missouri two
months, and in Virginia (outside of Henrico County) sixty days. In
the District of Columbia and New Jersey no pledge may be sold until
the expiration of one year from the date of pledging; in Pennsylvania
(Philadelphia) this period is eight months, except for clothing and dry
goods; in Connecticut, Delaware (Newcastle County), and New Mexico
it is six months; in Massachusetts and Virginia (Henrico County) it is
four months, as it is also in Pennsylvania (Philadelphia) on clothing
and dry goods, and in Alabama it is sixty days.
Where advertisement prior to sale is required a like variation is
found. The provisions of the laws of Alabama, Arizona, California,
New Jersey (outside of cities), Texas, and Virginia (Henrico County)
require that the auction be advertised at least five days prior to
sale. In Delaware (Newcastle County), District of Columbia, and
New York the time is fixed at six days prior to sale; in Colorado and
Pennsylvania (Philadelphia) at ten days, and in Maine and New Jersey
(in cities) at fourteen days. In New Mexico, where the pledge can not



262

BULLETIN OF THE DEPARTMENT OF LABOR.

be sold until the expiration of six months from date of the pledging,
the date of such advertisement is fixed at one month prior to expiration
of said six months. The laws of Utah and Colorado are further com­
mendable in that they limit the charges for expenses of sale to 10 and
5 per cent of the sale price, respectively.
In connection with the above provisions may be mentioned those of
a less general character, which at least two States hold in common.
One of the most commendable of these is the provision of the law of
Colorado making it illegal to sell any pledge until the pawnbroker
“ shall have given the pledger ten days’ notice by mail, such mail to
bq addressed to the post-office designated by the pledger as his or her
proper address.” A similar effort to secure for the rightful owner the
possession of that which belongs to him is found in the law of Texas,
whereby it is provided that within five days after sale a report shall
be made to the clerk and sworn to by the pawnbroker, giving time and
place of sale, the notice given thereof, the full description of the prop­
erty sold, by whom deposited, by whom purchased, and the amount
for which each article was sold. Together with this must be reported
the amount due the broker, principal and interest, expense upon each
article sold, and the amount of surplus, if any, remaining after the
above has been deducted.
Begtster.—In cities located in States where the laws have been at
all comprehensive the pawnbroker is required to keep a register in
which all pawns received shall be entered. As this book is primarily
intended to aid the police in tracing stolen or lost goods, special care
has been exercised to make the entry as comprehensive as possible.
Without exception, the name of the pawner is given, a description
o f the pledge, and the amount advanced. In addition to this, Ari­
zona, California, Colorado, Connecticut, Delaware (Newcastle County),
District of Columbia, Maine, Massachusetts, New Jersey, New York,
Pennsylvania (Philadelphia), Bhode Island, Utah, and Virginia
(Henrico County) require the residence of the pawner and the rate of
interest charged. Bhode Island also asks his occupation, while Utah
requires a general description of the pledger. But in the District of
Columbia and the States of Delaware (Newcastle County) and Vir­
ginia (Henrico County) the registers are still more comprehensive.
Not only do they require the usual items, but also a minute descrip­
tion of the pledger, which includes, among other things, color of eyes
and hair, height, and general appearance, the idea being to gain
such a description of the pawner that the police may be able to
identify those who may have pledged stolen property.
Beports.—In a few instances the law provides that the pawn­
brokers shall make reports at various times to the municipal author­
ities. In Connecticut only weekly statements are required, but in
Kentucky cities of 10,000 population or more, as also all cities of Bhode
Island and Ohio, and in the city of Milwaukee, Wis., a daily report
must be made to the police authorities. That such reports may be of



PAWNBROKING IN EUROPE AND THE UNITED STATES.

263

use in recovering lost or stolen property, it is usually required that
the pawn be held for at least twenty-four hours after the time of pledg­
ing. In this respect Delaware (Newcastle County) is peculiar, for
while no report is required, the pawnbroker must hold the pledge for
at least five days before he may allow it to be redeemed.
To the end that stolen or lost property may be traced, Delaware
(Newcastle County), District of Columbia, and Ehode Island have
stipulated that the pawnbroker may not disfigure pawns during the
time they are subject to redemption. Delaware (Newcastle County)
requires the broker to seize suspected articles and notify the police.
Rhode Island, with the same purpose in view, stipulates that no article
may be accepted from an employee, servant, or apprentice until the
pawnbroker is satisfied that the holder is the rightful owner; and in
Virginia (Henrico County) it is illegal to conceal a pawn for at least
forty-eight hours after its receipt.
Taxation.—But few of the States have seen fit to make special regu­
lations as to the method of determining the taxable value of the pawn­
broker’s property. In a majority of the States the tax assumes the
form of a license fee, an “ occupation tax,” a “ privilege tax,” a “ special
tax,” etc., upon the payment of which a license is issued. The laws of
Arkansas and Illinois merely require that he be assessed on the fair
cash value, and of Indiana the true cash value of the pledges in his
possession. In Kentucky the assessment is on the cash value of the
pawns held by him September 15 of each year; in Nebraska, those
field April 1; in Nortfi Carolina, tfiose held June 1, while in South
Carolina the law provides that a pawnbroker shall “ annually, in the
month of January, or before the 20th of February, return under oath
to the auditor of the county in which his place of business is located
the average monthly value of all property bound or pledged to him
during the year ending January 1 of the year in which the return
shall be made. If engaged in the business for less than a year prior to
the said 1st of January, then for such shorter period,” and such average
is to be ascertained by the rule prescribed for ascertaining the value of
the property of merchants.
I nsurance.—But three States—Delaware (Newcastle County), Penn­
sylvania (Philadelphia), and Colorado seek to save the pledger from loss
in case his pawn is destroyed by fire. In Delaware (Newcastle County)
each pawnbroker must carry insurance to the amount of at least $1,000
on the pawns in his possession, which sum he may be required to
increase to $5,000 on the demand of the clerk of the peace. In accord­
ance with its many commendable features, the law of Colorado requires
that every pawnbroker shall provide a place for the safe keeping of the
pledges received by him or her, and shall have a sufficient insurance
on the property held by him or her as pledges for the benefit of the
pledger of the property to pay one-half the real value thereof in
case of fire, which policy shall be deposited with the mayor of the city
or town; but neither the pawnbroker nor bondsman shall be relieved



264

BULLETIN OF THE DEPARTMENT OF LABOR.

from responsibility by reason of such fire, nor from any other cause.
In Pennsylvania (Philadelphia) each pawnbroker must carry insurance
to the amount of $5,000.
Miscellaneous Provisions.— In the line of general regulations
Massachusetts stipulates that a person of unsound mind shall not be
allowed to place articles in pawn, while Colorado, Kentucky, New
Jersey (in cities), Michigan, and Ohio prohibit the pawnbroker from
receiving a pledge from a minor without the consent of the parent or
guardian. In this respect Ohio goes further than the other States, in
that it not only prohibits the brokers from receiving pawns from minors,
but also from a person appearing to be intoxicated, a notorious thief,
or a person known to have been convicted of larceny or burglary.
Lastly, the District of Columbia, Delaware (Newcastle County), and
New York do not permit the broker to purchase articles offered to him
in pawn save at auction, while with the same point in view, Ohio pro­
hibits the pawnbroker from carrying on any other business in the same
building or employing helpers of less than 16 years of age.
In addition to the law of New York, noted above, and applying only
to cities o f 200,000 population or over, an act passed by the legislature
of the State in 1895 provides as follows: That corporations for lending
money on personal property, without actual delivery of the property
pledged or mortgaged, may be formed; that such corporations may act
as pawnbrokers; that such corporations must give a bond for not less
than $5,000, and that they may charge interest at a rate of not more
than 3 per cent per month for two months or less and not more than 2
per cent per month thereafter.
C I T Y O R D IN A N C E S R E G U L A T IN G P A W N B R O K I N G .

General Control.—Experience and the testimony of the authori­
ties in those cities governed largely by State laws indicate that the
work of the municipal authorities in the control of the pawn shops
would be greatly facilitated if the several States would enact laws
regulating the general features of the business. The fact that the vio­
lation of a State law will subject the offender to a more severe punish­
ment than a similar offense against a city ordinance has a wholesome
effect upon those who might be tempted to offend. Yet an examination
of the State laws shows that greater care has been given to the licens­
ing of the business, a matter easily within the control of the city, than
to the regulation of interest, charges, reports, stolen goods, lost tickets,
and payment of surplus, matters that give the municipal authorities
continual concern.
A s the laws now stand we find, without exception, that the pawn
shops are under the control of the police authorities of the cities. In
general, two plans have been adopted, that of daily inspection by
special officers or detectives, and that of daily reports to the police
authorities, coupled with daily visitation. The principal cities using
the former method are New York, Baltimore, and St. Louis; while Pitts


PAWNBROKING IN EUROPE AND THE UNITED STATES.

265

burg, Omaha, Boston, Cleveland, Buffalo, Providence, Louisville,
Chicago, Milwaukee, Indianapolis, and Minneapolis have adopted the
latter. In St. Louis four detectives are detailed to look after the busi­
ness. It is their duty to visit the pawnbrokers several times daily,
supply them with lists of stolen or lost property, inspect their books
and pledges, to assure themselves that the broker has kept within the
limits of the law, and to recover any stolen or lost property that may
have been accepted in pawn. Where the daily reports are used the
broker either brings his report to the police headquarters or hands it
to the detective whose duty it is to inspect the pawn shops within his
district. But this report does not in any way alter the duties of the
detective 5 he has access to the broker’s books and wareroom the same
as in other cities, the only difference being that it is his further duty
to assure himself that the broker has reported all articles received.
The reason assigned by the police of New York and St. Louis for not
requiring daily reports is that it would be impossible to secure a full
list of all articles pledged, but the testimony of like officials in cities
where the reports are used, save in Pittsburg, does not substantiate
the argument. Moreover, in this investigation special pains have been
taken to test the completeness of the returns, and in no instance,
whether the pawn ticket had been accepted or not, did the report of
the following day fail to note the pledge.
While the general character of these reports is the same, the data
they furnish are by no means coextensive. As a rule the blanks are
supplied by the police department, and besides having the law printed
upon them spaces are left in which the broker is to give the number of
the j)awn ticket, the time the pawn was received, the amount advanced,
and a general description of the pledge and pledger. In some instances,
as in Washington and Milwaukee, the description of the pledger is
very minute, not only is name and address taken, but height, color of
hair and eyes, style of beard, age, complexion, etc. In reporting
watches the number of their works, case, and name of maker are
required, and with jewelry any particular markings are to be described.
It must be admitted, however, that in many instances the description
of the pledger as furnished by the broker in his reports would not
greatly facilitate identification. In Washington, for instance, where a
very painstaking description is asked, the broker merely inquires the
name and residence of the pledger, and uses his own judgment as to
the other points of the report. As a result the police place little
dependence on the description given. But while the ordinance or
State law, as the case may be, is not rigidly enforced in reference to
the personal description of the pledger, no such violation is tolerated
in the description of the pledges. The numbers of watches and the
distinctive markings of jewelry must be carefully .returned, or an
explanation of the deficiency is soon required. By this means the
police authorities are enabled to keep on file a correct description of all
9986—No. 21----- 7



266

BULLETIN OF THE DEPARTMENT OF LABOR.

articles pawned in the city, and herein lies the chief advantage claimed
for the daily reports over that of visitation. With these on file, if an
article be reported as lost or stolen, the officials have only to turn to
the reports in order to learn if a pawn corresponding to the description
given has been pledged. Under the other plan it would require that a
visit be paid to each pawn shop in the district and that all pawns
pledged within a month or so previous be carefully examined.
As regards the manner and extent of police control, it appears that
the police of Boston are given greater power than in any other city.
Not only do they enforce the ordinances, but they are further author­
ized to make rules governing the business. The force of detectives,
which have the inspection of the pawn shops in charge, number about
thirty men, so that from five to six visit each broker daily. One result
of this strict supervision is the large number of criminals the jiolice
are able to apprehend. Indeed, it is reported that at least two-thirds
of the robbers arrested in Boston are secured through the instrumen­
tality of the pawn shops. In St. Louis also the police are very active,
and in the majority of the cities under consideration they seem to have
the business well in hand; but in no instance do we find them making
regulations comparable to those put forward by the police of Boston.
Following is a tabulation of the ordinances regulating pawnbroking
in various cities of the United States:
O R D IN A N C E S R E G U L A T IN G P A W N B R O K IN G IN V A R IO U S C IT IE S OF T H E U N IT E D
STATES.

C ity.

B altim ore...
Boston ____

An­
nual
li­
cense
fee.

Length!
o f loan
(mos.).

Bond.

$200 $10, 000
50

300

Interest.

Charges.

Tim e after
expiration M ethod
o f loan
o f sale.
before sale.

D isposi­
tion o f
surplus.

6

6 per cent per an­ 2 per cent 10 d a y s ... A uction Returned

4

$1 or less, first week

!
B u ffa lo ........

500

10,000

12

C hicago........

300

500

12

num.
per month.
to owner.
Forbidden
A uction Returned
5 cents, each week
to owner.
a fte r 2 cents; $ lt o
$3, first w eek 4 per
cent, each week af­
l
ter 2\ per cen t; $3
to $10, first week 3
percent, each week
after 2 per cent;
$10 to $25, first
w eek 2\ per cent,
each week after 2
percent; $25t o $50,
first week 2 per
cent, eacn week af­
ter 1 per c e n t ; $50
to $ 100, first week
14 per cent, each
week after 1 per
cent.
$1 to $ 10,10 per cent Forbidden 3 m onths. A uction' R eturned
per m onth; $10 to
except for
to owner.
$25, 6 per cent per
insurance.
m onth; $25 to $50,
5 per cent per
m on th ; $50 to $75,
2£ per cent per
m onth; over $75,
1 £ per cent per
month, (a)
3 per cent per m onth. Forbidden

a I t would seem that the State law given on page 258 should apply to Buffalo, but the city clerk states
that a city ordinance fixes the interest as here tabulated.




PAWNBROKING IN EUROPE AND THE UNITED STATES.

267

O R D IN A N C E S R E G U L A T IN G P A W N B R O K IN G IN V A R IO U S C IT IE S OF T H E U N IT E D
S T A T E S —Concluded.

City.

An­
nual
li­
cense
fee.

Length
Bond. o f loan
(mos.).

Cleveland. . .
Kansas City
L ouisville ..
M ilwaukee

$50
200
350
150

M inneapolis
N e w a r k -----

150

2, 000

6
12

N ew Orleans
N ew Y o r k ..

(a)
500

10,000

12

Omalia.

100

2, 000

Philadelphia

(b)

1,000

P ittsb u rg.

200

P rovidence .
R ochester ..

100
100

San Francis-

120

St. L ou is-----

400

1,000

W ashington

100

3,000

co.

$500

D isposi­
tion o f
surplus.

60 d a y s ...
90 d a ys__

N o regulation (5 to 10
per cen t per month
is charged).

500

2,000

Charges.

2 per cent per m onth. Forbidden

1,000

100

Interest.

i
Time after
expiration Method
o f sale.
o f loan
before sale.

2 per cent per m onth. Forbidden

A uction Returned
to owner.

3 per cent per month
for first six months
on sums o f $100 or
less and 2 per
cent thereafter; on
sums over $ 100,
2 per cent for first
six months and 1
per cent thereafter.

A uction Returned
to owner.

Charge for
ticket fo r­
bidden.
6 per cen t per annum . 5 per cent
A uction Returned
(c)
permonth.
to owner.
\ per cent per month
3 months .
j for at least 1 m onth.
...............
4
$1 to $25,10 per cent F or insur­ 6 months ............... |
j per m on th ; $25 to
ance i f from date
owner re­ o f paw n­
j $50, 7 per cent per
ing.
| m onth; $50 to $75,
quires.
j
j
6 per cent per
i m onth; $75 to $100,
5 per cent per
m onth; $100 or
over, 3 per cent
per month.
2 per cent per m onth. Forbidden
Returned
to owner.
2 per cent per m onth. Charge for
ticket fo r­
bidden.
12 3 per cent per m onth.
A uction Returned
(d)
to owner.

a $375 i f capital in use is less than $50,000; $500, if $50,000 or more.
6 $100 for a business o f less than $ 10, 000; $200 for a business o f $10,000 or more but less than $20, 000;
$300 for a business o f $20,000 and upward.
c Clothing and dry goods 4 m onths; jew elry 8 months.
d To be fixed by m unicipality.

Licenses.—In the foregoing tabulation of the several city ordi­
nances, it appears that the license fee varies from $50 in Boston and
Cleveland to $500 per annum in Buffalo and New York. This, how­
ever, due to exceptional circumstances, is not strictly correct in the
case of Cleveland, where a peculiar condition exists. Prior to 1896
the State law fixed the license fee for the pawnbrokers of the State
at $50, but in that year an act relative to licenses in Cleveland was
passed. But, while the latter act was originally formulated by the
mayor of the city, the legislature introduced such radical amendments
that he refused to appoint the necessary officers to put it in operation,
while the clerk of the city claimed he had no right to collect the
licenses fixed by the former law. The result is that a broker in the
city may pay a license fee or not. Moreover, he may conduct his busi­
ness largely according to his own wishes. It should be said, however,



268

BULLETIN OF THE DEPARTMENT OF LABOR.

that abuses as to stolen or lost pawns have been held in cheek, so that
aside from the exorbitant charges the system of Cleveland compares
very favorably with that of any city in the list.
In the case of Baltimore it must be remembered that the license fee
o f $200 is merely a city license, and that before doing business the
broker must also secure a State license, costing $500, making a total of
$700. This, however, is not the entire sum usualiy paid. By an ordi­
nance of the city a person is not permitted to sell second-hand articles
without a so-called trade license, and as this is the pawnbroker’s main
source of profit it is necessary for him to secure a license for a stock of
at least $ 1 ,000, which costs an additional $13.10. This, together with
a $1 fee required to secure the first license, makes a total of $714.10.
Contrary to the usual custom, New Orleans and Philadelphia attempt
to charge a license fee in proportion to the amount of capital invested
or business done. The result in Philadelphia at least is unsatisfactory,
as it has had the effect to fix the license fee at $ 100, it appearing
impossible to find a broker who does a business of over $ 10,000 per year.
During 1897 there were issued 5 pawnbrokers licenses in Baltimore,
86 in Boston, 9 in Buffalo, 68 in Chicago, 26 in Cleveland, 4 in Louis­
ville, 5 in Milwaukee, 18 in Minneapolis, 7 in Newark, 7 in New Orleans,
134 in New York, 22 in Omaha, 92 in Philadelphia, 11 in Pittsburg, 8
in Providence, 6 in Bochester, 243 in San Francisco, 10 in St. Louis,
and 5 in Washington.
Pledges.—The question as to the articles that may be accepted in
pawn is left almost entirely in the hands of the brokers. Buffalo pro­
hibits them from receiving u partly manufactured articles for wear or
consumption, or material plainly intended for such manufacture.”
Bemaining restrictions apply to the status and character of the per­
sons from whom pledges may be received. The ordinances of Buffalo,
as also those of Pittsburg, Chicago, and Milwaukee, forbid the broker
to take pawns from intoxicated persons or drunkards, or persons asso­
ciating with thieves. Chicago goes yet further and denies the pawn­
broker the right to take pledges from persons known to have been
convicted of burglary, while, with few exceptions, the taking of
pledges from minors is prohibited.
Pawn Tickets.—As a rule the pawnbroker is required to give a
ticket in receipt for any pledge received, the only exceptions to the
rule discovered in the course of this investigation being in Cleveland,
where the conflict of laws already alluded to accounts for a departure,
and in Philadelphia, where it is quite customary for regular patrons to
leave articles without taking receipts. In Providence, one often sees
a large stack of tickets on the desk of the broker, which his patrons
have left with him for safe keeping. The data given on a pawn
ticket varies from city to city, and even in the same city. Without
exception it bears a given number, the date either of pledging or for
payment of the loan, amount loaned, description of article pawned,




PAWNBROKING IN EUROPE AND THE UNITED STATES.

269

and the name and address of the broker. As a rule the ticket also
bears the advertisement of the broker and some statement as to the
redeeming of articles by mail. In Buffalo, New York, Washington,
Boston, Chicago, and St. Louis one finds a general statement of the
law as to the redemption and sale of pledges printed on some part of
the ticket. Besides this several of the brokers in each of these cities
add the rate of interest charged. But the plan adopted is by no means
general, the ordinance as a rule merely requiring the substance of the
entry in the register, minus the personal description.
In New Orleans the business is conducted under the general laws of
the State. This necessitates the use of a so-called deed of pawn, which
serves as the regular pawn ticket used by other brokers. In some
offices this deed is signed by the borrower and kept in the office of the
lenders, in others a duplicate is given to the borrower. The deed in
common use reads as follows:
New O r l e a n s , --------- , 189-.
I hereby acknowledge that I am indebted t o --------- in the sum o f ------- dollars,
which I agree to pay on or before t h e ------ day o f ---------- , 189-.
Now, in order to secure the punctual payment of the above sum, I hereby pledge,
pawn, and deliver to the sa id --------- the following described property, viz: -------------------and in case the said sum is not fully and punctually paid at the time above
expressed, then I agree that the said property be forfeited to the said--------- and
become------ property without further transfer or conveyance, or the sa id ---------- may
sell the said property at public or private sale a t ------option, and without recourse to
legal proceedings.
N o t e .— Not responsible in case of fire or robbery unless by special agreement.
(Signed) ------ ---------------.

Length of Loans.—Where ordinances or laws do not fix the dura­
tion of the loan, the tendency is to limit it to thirty days, which period,
however, may be indefinitely extended by successive renewals and the
payment of the accrued interest. In Cleveland most of the loans are
made for thirty days, but some pawnbrokers claim the law applying
to property left with hotel keepers finds application to them, and
that legally they should hold the pawn for one year; yet at the same
time the unredeemed pledges are usually sold at the expiration of
two or three months. A similar conflict between the law and practice
is seen in Chicago. According to the tickets issued by some of the
brokers, loans are made for one month, but the terms of the law require
that pawns be held for one year. The law of course governs the matter,
and anyone familiar with its provisions may secure his pledge until the
expiration of the year by application to the proper authorities. The
ordinance of Philadelphia, recognizing that clothing is difficult to store
and that the constant change in style may cause the broker loss, follows
the German idea and permits its sale at the expiration of four months,
while Boston allows perishable articles to be sold within a month.
I nterest and Charges.—Where the city ordinance or State law
fixes a maximum rate of interest and forbids extra charges, no difficulty




270

BULLETIN OF THE DEPARTMENT OF LABOR.

is experienced in determining the legal rate. Where, however, the
ordinances do not fix a rate of interest, nor yet forbid charges, we have
a problem similar to that of determining the price of an article when it
varies in different sections of a city or State. In the pawn business, as
in other lines, competition, personal preference, acquaintance, etc.,
materially affect the rates of interest and charges, and render any state­
ment on the subject liable to criticism, hence in the table we have lim­
ited the rate to that prescribed by the ordinances. It will be noted
that a fixed rate for all sums is found in Philadelphia, St. Louis, Kansas
City, Newark, Chicago, San Francisco, Pittsburg, Washington, and
Baltimore, while Boston, Buffalo, Rochester, and New York attempt a
gradation of rates. New York and Boston seek to grade their rates on
the duration and amount of the loan, while Buffalo and Rochester make
a gradation based solely on the amount loaned. Charges unfortunately
are seldom regulated by ordinance. Yet in Boston, Chicago, Kansas
City, Newark, and San Francisco they are prohibited. In Chicago,
however, charges are collected in opposition to the law. Washington,
Philadelphia, and Baltimore allow a percentage per month for storage,
while Rochester and Buffalo prohibit charges save for insurance.
Following is a tabulation of the per annum rates per cent of interest
charged by brokers in various cities of the United States:
P E R A N N U M R A T E S P E R C E N T OF IN T E R E S T C H A R G E D B Y B R O K E R S I N V A R IO U S
C IT IE S OF T H E U N IT E D S T A T E S .

$1 for—
City.

B a lt im o r e ......................................................
B oston .............................................................
B u ffa lo ...........................................................
C h ic a g o .........................................................
C leveland.................... ...................................
Kansas C it y ..................................................
M ilw a u k e e ....................................................
N e w Orleans..................................................
N ew Y o r k ......................................................
P hiladelphia........................ .........................
P i t t s b u r g ......................................................
P r o v id e n c e ....................................................
R o c h e s te r ......................................................
St. L o u i s ........................................................
W a s h in g to n ..................................................

$30 for—

$105 for—

1 month. 4 months. 1 month. 4 months. 1 month. 4 months.
30
132

120
120
300
24

120
300
36
60
240
180

120
60
36

30
123

120
120
120

30
60
60
60

30
51
60
60

120

120

48
36
30
240

24
60
48
36
30
240

24
60
48
36
30
240

60
36

84
48
36

24

120

120
120 |

120

30
54
18
36
60
24
60
24
24
30

30
49£
18
36
60
24
60
24
24
30

120

120
120

84
48
36

120
120

36
36
24

36
36
24

In the foregoing an effort has been made to give the actual per annum
rates per cent charged by brokers in the several cities. The rates
are not the minimum, but nearer the maximum, having been deter­
mined by what a stranger is asked to pay in the way of interest and
charges to secure the advance of the amounts given in the table for the
time the loans are usually made—one and four months. For instance,
in Philadelphia the majority of the brokers charge at least 5 cents
interest on all loans, which naturally makes the rate on small, shorttime loans high. The same is true in Cleveland, where one often pays
25 cents for the use of $1 over night, although the usual rate is 10 per
cent per month. Likewise, in New Orleans, the smallest charge made



PAWNBROKING IN EUROPE AND THE UNITED STATES.

271

on loans is 25 cents, which raises the figure in the table to the enor­
mous rate of 300 per cent per annum, while the regular charge varies
from 2 to 5 per cent per month. In the same manner, in Providence,
the minimum charge is usually 15 cents, while the rate is 10 per cent
per month. The high rate for Pittsburg is due to the failure to pro­
hibit charges. The legal interest rate is but J per cent per month, or
#
6 per cent per annum, but the charges levied raise it to 20 per cent per
month, or 240 per cent per annum. In New York the variation is so
great that it is difficult to fix upon the typical rate. Three per cent
per month, with a 12-cent charge for hanging up, etc., in the case of
clothing is the common rate, yet the majority of the brokers are refus­
ing to receive clothing in pawn. One finds advertisements offering
money at the same rate as the Provident Loan Society—1 per cent
per month—and others advertise to loan at 2 per cent per month on
sums of from $1 to $25, 1£ per cent per month on sums of from $26 to
$ 100, and 1 per cent per month on sums of over $ 100, while others
not having lowered their rates offer money at 1 £ per cent per month on
sums of over that amount. In Philadelphia a similar variation is
found. While the brokers in the central part of the city charge at
least 5 per cent per month on the smallest loan, several brokers in
other parts charge only 3 per cent per month. On loans of $25 or more
5 per cent per month is invariably asked, but judicious bargaining
may secure a rate of 3 per cent, and on sums of $100 or more 2\ per
cent, depending largely on the security offered.
The rate paid is greatly increased by the extremely small loans that
are made and the short duration of the loan. In every city is found a
class of u repeaters”—those who pawn their clothing or jewelry on Mon­
day or Tuesday and redeem it again Saturday evening. In this way
they pay interest for at least one month, while they have had the use
of the money but a fourth of the time, a process which naturally quad­
ruples the rate of interest given in the first column of the table.
Moreover, interest is, with but few exceptions, reckoned on $1 for one
month; still many of the loans are only for 10 to 25 cents for a week’s
time. But although this gives a rate almost too large to be mentioned,
it must be remembered that it costs the broker but little more time or
labor to make a loan of from $50 to $100 for six months than one of 25
cents for a week.
Stolen or Lost Goods.—One of the most difficult matters to
adjust is the means of recovery of stolen or lost articles. The authori­
ties recognize that the broker may have taken every precaution and
yet have been deceived. They further understand that since he holds
a license granted by the city or State he is entitled to a degree of pro­
tection against those who constantly seek to exploit him. For this and
similar reasons they have been very loath to seize and return property
without positive proof of its ownership. Boston goes so far as to
require the arrest and conviction of the thief before the police will
return the pawn to its owner. Of course, this does not deny the owner



272

BULLETIN OF THE DEPARTMENT OF LABOR.

the right to resort to a writ of replevin. In Providence merely satis­
factory proof of ownership is required, while in Washington suspected
goods are seized, carried into court, and, if ownership is proved,
returned. With the remaining cities the usual laws as to stolen prop­
erty find application, but in all cases the police, after using every
legitimate meaus to trace all articles reported and having found them,
unless it is a clear case of receiving stolen property, seek to bring
about a compromise whereby both owner and pawnbroker share the
loss.
L ost Tickets.—A continual source of annoyance to the broker is
the reported loss of his ticket by the patron. The opportunity thus
offered for dishonesty on the part of both patron and broker is so great
that in some instances the authorities have taken the matter in hand.
In Boston the police require that the loser make an affidavit in their
presence, which affidavit may serve as a ticket. A similar plan is
employed in St. Louis, save that the affidavit is made by a notary, for
which a fee of 50 cents is usually charged. Some of the brokers, how­
ever, by a special arrangement with lawyers, secure affidavits for their
patrons at 25 cents each, yet, if the owner is willing to wait 90 days,
he may redeem his property without an affidavit. The police of Balti­
more require, for redemption in such cases, that a bond be filed to cover
the value of the property. The plan is quite similar to that used by
the Provident Loan Society of New York, where, for pledges of $50
or over, an indemnity agreement is drawn up whereby the party
agrees to “ indemnify and save harmless the society from all claims
which may be made against it, or loss or damage or expense which may
be incurred by its delivering up the pledge, as well as against all
expense of resisting such claims, whether successfully resisted or not.”
Sale of Unredeemed Pledges.—By ordinance in Buffalo, Phila­
delphia, Washington, New York, Newark, Baltimore, and Boston, the
sale of pledges is required to be by public auction, yet this is not
always fully adhered to. In Philadelphia some of the brokers admit
that they only put such pledges up at auction as they think inadvis­
able to sell at private sale. A few of the brokers in Cleveland keep
standing advertisements of sale in the papers, and then every morning
a mock auction is held and the pledges purchased en masse by proprie­
tor or clerk. To avoid the necessity of selling at auction, the brokers
of Buffalo require the pledger to sign a waiver giving the broker full
right to the property if not redeemed, while in Boston the difficulty of
deciding just what pledges have a value of $25 renders the auction
clause inoperative.
The reasons assigned by the brokers for refusing to sell at public
auction is that such a sale invariably means a loss of from 5 to 10 per
cent on the sum advanced. They point out that the desire to meet
competition leads them to advance so near the real value of the pledge
that it is only by private sale that they are able to recoup themselves.
The statement seems borne out after witnessing several such sales.



PAWNBROKING IN EUROPE AND THE UNITED STATES.

273

On the other hand the experience of the philanthropic institutions is
otherwise; but in this connection it must be remembered, as will be
pointed out later, that theirs is an entirely different class of custom.
As a rule it may be safely admitted that sale by auction increases the
loss of the broker. The only i>oint then at issue is whether those pawns
that do actually give a surplus at time of sale, as some of them must,
may rightfully be called upon to make good the broker’s indiscretion
in advancing too large a sum on other pledges.
Repayment of the Surplus.—Here again practice and law are
at variance. In those cities requiring the repayment of the surplus a
book of sales is kept, but diligent inquiry fails to discover that many
of the patrons ever receive the sums that appear due them. That this
is largely due to ignorance of the law is seen by the reports of such
institutions as the Provident Loan Society of New York and the
Collateral Loan Company of Boston, which show that only a small
number of their patrons apply for this surplus. But it is further due
to the fact that the high rates of interest charged in many places
increase the amount due on the loan so rapidly that it is only neces­
sary to hold a pledge a few months in order to have it equal the sum
it will bring at auction. In doing this the broker acts clearly within
the law, for no ordinance or statute has been found requiring that a
pawn be sold within a certain time. Where laws as to the time of sale
have been made, the fear seems ever to have been that the broker would
sell too soon, but there is a failure to appreciate that it would be pos­
sible to work an injury to the pledger by holding the pawn after the
expiration of the loan.
A M O U N T OF B U S IN E S S .

That some idea may be gained of the amount of business done by
pawnbroker's, the accompanying tabulations are presented.
In the table immediately following the number of articles, amount
loaned, and average loan on articles pledged in several cities of the
United States during one month are shown:
N U M B E R OF A R T IC L E S , A M O U N T LO A N E D , A N D A V E R A G E L O A N ON A R T IC L E S
P L E D G E D I N S E V E R A L C IT IE S OF T H E U N IT E D S T A T E S D U R IN G ONE M O N T H .
Pittsburg.
A rticles.

N um ­ A m ount
ber.
loaned.

G old w atches................... 1,193
641
Silver w a tch es ...............
688
R in g s ...............................
399
J e w e lry ............................
273
C lo th in g ..........................
49
M usical instru m en ts...
43
F iie a rm s..........................
42
M iscellaneous.................

$6, 986.60
1, 238. 55
3, 952. 75
4,157.85
384. 85
156. 55
114. 70
121. 50

T ota l...................... 3, 328

17,113. 35




Providence.
A v e r­ Num­ Am ount
age
loaned.
ber.
loan.
$5. 86
1. 93
5. 75
10.42
1.41
3.19
2. 67
2. 89

592
508
526
169
972
48
54
810

$3, 328.82
849. 97
2,194. 57
899.77
1,136.40
133.72
100.05
2,931.67

5.14 3, 679

11, 574. 97

Buffalo.
A v e r­
N um ­ Am ount
age
ber.
loaned.
loan.

A ver­
age
loan.

953
419
717
266
464
59
29
267

$6, 275. 70
748. 25
6,118.00
3, 574. 00
1,067.40
186. 50
123.45
522.35

$6.59
1.79
8.53
13.44
2. 30
3.16
4.26
1.96

3.15 3,174

18, 615.65

5.87

$5.62
1.67
4.17
5.32
1.17
2. 77
1.85
3.62

274

BULLETIN OF THE DEPARTMENT OF LABOR.

N U M B E R OF A R T IC L E S , A M O U N T LO A N ED , A N D A V E R A G E L O A N ON A R T IC L E S
P L E D G E D IN S E V E R A L C IT IE S OF T H E U N IT E D S T A T E S D U R IN G ONE M O N T H —
Concluded.
W ashingto n.
A rticles.

Num ­
ber.

Total
value.

809 $10, 761. 25
Gold w a t c h e s .................
Silver w a tch e s ...............
542
1,179. 75
R in g s ................................ 1,294 12, 523. 50
Jew elry ..........................
562
6,070.10
C lo t h in g ..........................
555
1,051.25
38
176. 25
M usical instruments
53
221. 50
F irea rm s........................ ;
228
322.10
M iscellaneou s.................
T o ta l........... .......... 4,081

32,305.70

Boston.

A v e r­
age
value.

N um ­
ber.

$13.30
2.18
9.69
10.80
1.90
4. 64
4.18
1.41

1,430 $12, 325. 34
2, 546
2, 698.18
2, 592 10, 525.44
597
3, 324. 64
6, 938
7, 263.00
401.22
247
141
234.22
1,622
1, 848. 00

7.92 16,113

Amount
loaned.

38, 620.04

Chicago.
A v e r­
N um ­
age
ber.
loan.

A m ount
loaned.

A ver­
age
loan.

5,160 $40,242. 35
2, 980
5, 270.55
4, 822 34,141.10
2, 276 25,841.34
6, 543 11, 344. 45
356
768.46
596
1, 225. 50
1,724
5,415. 55

$7. 80
1.77
7. 08
11.35
1. 73
2.16
2. 06
3.14

2.40 24,457 .124,249.30

5.08

$ 8 . 62

1.06
4.06
5. 57
1.05
1.62

1.66

1.14

1

The above figures give the results of a tabulation of the daily reports
made to the police departments during a single month by the pawn­
brokers of the several cities considered. Deeming a summer month
nearer typical of the business than one in the fall or winter, it was
primarily intended to confine the tabulation to the month of July, but
as the work progressed it was found inconvenient in some instances
to adhere to the original plan, hence for Washington and Boston the
month of June was taken, while for Pittsburg it was necessary to give
the results for May. In the case of Washington it must be noted that
the total value and the average value are given instead of the total loan
and the average loan. This is necessitated by the character of the
reports, which in that city give the value of the pledge rather than the
amount advanced upon it. An estimate even of the total amount
loaned is not obtainable; for, although it is claimed that from twothirds to three-fourths of the value is advanced, many pledgers do not
desire as large a loan as their pawn would enable them to obtain. The
figures may, however, give a very conservative estimate of the auction
value of the articles received in pawn. For the remainder of the table
the results are comparable, particular pains having been taken to
properly classify every pawn reported by the brokers. Clothing has
been made to embrace all sorts of ladies7 and gentlemen’s wearing
apparel, including bonnets and shoes. The miscellaneous list embraces
all those articles received that can not properly be classified under any
of the other heads. In Pittsburg the miscellaneous list is made up
largely of tools; in Boston, of household goods, bedding, etc.; while in
the remaining cities it comprises a heterogeneous mass o f articles,
ranging from a gold tooth or a communion set to $ 10,000 worth of
railroad stock.
Wide as is the range of articles accepted in pawn, a marked prefer­
ence is shown for those of gold and silver, rings and jewelry as a rule
comprising about 80 per cent of all pawns received. Clothing forms a
very important item of the trade in Boston, as also in Providence, and
while still prominent in Chicago, the tendency of the brokers to confine
their trade to jewelry and kindred articles is increasing. This is of



PAWNBROKING IN EUROPE AND THE UNITED STATES.

275

course due to the extra amount of work and storage room required for
the care of clothing and the possibility of loss in its sale arising from
changes in fashion, etc. For these reasons the amount advanced on
such pawns is extremely low. Yet it is not due to the large proportion
of clothing received in Boston that the average loan for that city is
lower than in the other cities, for if we eliminate the item the average
is only $3.42, while that of Providence with a similar omission is $3.86.
It is probable that the true reason is to be found in the large number
of brokers in Boston, which leads them to accept pawns refused by
many brokers in Providence and Chicago. Boston has one pawnbroker
to every 5,216 inhabitants, Providence one to every 16,518, and Chi­
cago one to every 16,174.
Investigations in other cities have shown that the average loan in
Cincinnati was $3.58 (a) and in Minneapolis $6.16. (b)
In the table following the number of articles received per month by
the pawnbrokers of Cleveland from July, 1897, to June, 1898, is shown:
N U M B E R OF A R T IC L E S R E C E IV E D P E R M O N TH B Y T H E P A W N B R O K E R S OF C L E V E L A N D FR O M J U L Y , 1897, TO JU N E , 1898.
1897.
A rticles.

Gold w a tch es ...
Silver w atches..
R i n g s .................
J e w e lr y .............
C lothing.............
M usical instru­
ments .............
F ire a rm s ...........
M iscella n eou s..

A uJuly. gust.

1898.

Sep­
N o­
D e­
F eb ­
Total.
tem ­ Octo­ vem ­ cem ­ Janu­
ru ­ March. April. M ay. June.
ary.
ber. ber. ber. ber.
ary.

80
59

629
233
489
149
166

645
285
471
227

200

606
235
449
131
322

18
13
63

24
32
169

29
36
147

150

776
266

775
279
506
205
229

222

35
41
322

26

22

432
129
232

793
597
230
219
425 , 377
152
199
210
208

605
224
466
156
289

621
243
386
119
338

708
261
453
125
355

677
251
451
159
251

8,116
2, 926
5,127
1, 831
2, 859

18
32
143

37 i
37 ! 43
153
193

28

35
27
239

15
34
28 ’ 26
127
213

37
37
152

336
374
2, 071

684

200

T o t a l........ 2, 392 1,497 1,891 2, 040 1,941 1,870 2, 037 1, 864

2, 041 1,877 2,175 2, 015 23, 640

It will be remembered that on the continent of Europe the greatest
amount of business is done during the summer months. To a slight
extent the same is true in Cleveland, if we consider May, June, and July
as summer months. The maximum is seen to have been reached in
July and the minimum the month following. Some cause—perhaps the
various payments that fall due at the end of a quarter—has tended to
increase the number of pledges received in the months of January, July,
and October. April, however, is an exception to the rule, the greater
number having been pledged in the month previous. It is interesting
to note the increase in the number of articles of clothing pawned in the
months of April and May and the gradual decrease from then until
September. At the commencement of cold weather it seems quite prob­
able that the increase is due to the pawning of winter clothing, and the
marked increase in November can only be explained on the grounds
a Given in a private letter from Mr. H. A. Millis, University of Chicago, who has
made a special study of the pawnshops of Cincinnati.
b Fourth Biennial Report of the Minnesota Bureau of Labor, p. 35.




276

BULLETIN OF THE DEPARTMENT OF LABOR.

that the purchase of winter clothing has led to difficulties which have
required the pledging of the same.
To supplement by American experience the study begun in Germany
as to the effect of holidays and the comparative amount of business
done on the several days of the week the tables following have been
introduced.
In the table immediately following the average number of articles
pledged and redeemed at the Provident Loan Society of New York
on each day of the week, and the general average, for the months of
June, July, and August, 1897, are shown:
A V E R A G E N U M B E R OF A R T IC L E S P L E D G E D A N D R E D E E M E D A T T H E P R O V ID E N T
L O A N S O C IE T Y OF N E W Y O R K ON E A C H D A Y OF T H E W E E K , A N D T H E G E N ­
E R A L A V E R A G E , F O R T H E M O N TH S OF JU N E , J U L Y , A N D A U G U S T , 1897.
July.

June.
Pledged.
D ay o f week.

M o n d a y .................................
T u e s d a y .................................
W ed n esd a y............................
T h u rsd a y...............................
F rid a y .....................................
Saturday ................................

A v e r­
age
num­
ber.

Redeemed.

A verage
daily
loan.

A ver­
A verage
age
daily
num­
loan.
ber.

176 $3,703.83
153 3,234.45
115 2,733. 25
109 2,193. 25
95 1 , 828.38
161 2, 797. 68

103 $2,453.25
.91 1, 843.10
77 1, 873. 00
80 1, 680. 25
79 1,692.13
153 3,009. 25

A ugu st.
Pledged.
Day o f week.

M o n d a y .................................
T u esd a y.................................
W ed n esd a y............................
T h u rsd a y...............................
F rid a y .....................................
Saturday ...............................

A ver­
age
num­
ber.

A verage
daily
loan.

150 $3,277.40
123 2,680. 40
109 2,480.31
110 2, 592. 38
88 1, 694.63
152 2, 828.19

Pledged.
A v e r­
age
num ­
ber.

Redeemed.

A verage
daily
loan.

A v e r­
age
num ­
ber.

170 $3,394.25
144 3,070.50
136 2,949.19
123 2, 577.15
111 2,218.80
172 2, 866.20

97
80
79
75
73
177

A vera ge
daily
loan.
$ 1 , 680.50
1,716.69
1, 723.75
1 , 601. 60
1, 594. 90
3,380.25

General average.
Redeemed.

A v e r­
age
num ­
ber.

Pledged.

Redeemed.

A verage
daily
loan.

A ver­
A verage
age
daily
num­
loan.
ber.

A ver­
age
num­
ber.

91 $2, 086. 70
99 2,303.00
86 1, 678.88
76 1, 776. 00
80 1, 744. 75
206 3, 790.00

164 $3, 448. 76
146 2, 758. 70
120 2,721.87
114 2, 632.42
98 1, 937. 39
161 2, 833.42

97
90
81
77
77
177

A verage
daily
loan.
$2,107.33
1, 839.58
1,767.35
1,808.71
1, 670.93
3,392.17

In the above table the summer months of June, July, and August
have been chosen as illustrative of a normal business, since they pre­
sent as little fluctuation, due to holidays, etc., as any three consecutive
months of the year. The results shown by the general average tend
to confirm the conclusions previously drawn. The average number of
articles pawned on Mondays during these three months was 164, with
an average daily loan of $3,448.76. During the week the amount loaned
decreased until Friday, when it reached its lowest point, a marked
increase being noted on Saturday. The highest number of pawns were
redeemed on Saturday, prior to which the figures show a gradation
similar to that shown by the receipts.
The table following shows the number of articles pledged and
redeemed per day and the amounts loaned on the same at the Provi­
dent Loan Society of New York during the months of July, August,
September, and December, 1897.



277

PAWNBROKERGr IN EUROPE AND THE UNITED STATES.

N U M B E R OF A R T IC L E S PLE D G E D A N D R E D E E M E D P E R D A Y A N D T H E A M O U N T S
L O A N E D ON T H E SA M E A T T H E P R O V ID E N T L O A N SO C IE T Y OF N E W Y O R K
D U R IN G T H E M O N TH S OF J U L Y , A U G U S T , SE PTE M B E R , A N D D E C EM BE R , 1897.
July.
Day o f week.

Pledged.
N um ­
ber.

T h u rs d a y ..............................
F rid a y .....................................
S atu rd a y...............................
M o n d a y .................................
T uesday.................................
W ednesday............................
T hu rsd ay...............................
F rid a y........ ..........................
S a tu rd a y ................................
M o n d a y ..................................
T u esd a y................................
W ednesday............................
T hu rsday................................
F rid a y .....................................
S a tu rd a y................................
M o n d a y .................................
T uesd ay.................................
W ed nesd ay............................
T hursday...............................
F rid a y .....................................
S a tu rd a y................................
M o n d a y .................................
T u esd a y.................................
W ed nesd ay...................... .
T hu rsday............................
F riday
.................. ...........
S a tu r d a y ...............................

A m ount
loaned.

A ugu st.
Redeemed.

N um ­
ber.

A m ount
loaned.

79 $1,931.50
80 1, 453. 00
166 3,137. 50
(a)
{a)
109 1, 924. 50
90 2, 016.50
77 1, 673. 00
79 1, 634.00
141 2, 648.00
92 1,602.00
68 1.745. 25
79 1, 580. 50
74 1, 462.50
85 1 , 800.50
167 2, 971.00
98 1,639.00
69 1, 409. 50
75 1, 831.00
57 1, 073. 50
62 1,826. 00
197 4,093.25
102 1,800. 50
72 1,787. 50
73 1, 467. 00
90 1,867.50
58 1,261.00
212 4, 051. 50

134 $3,045.25
125 2, 300. 75
169 2, 028. 75
(a)
(a)
211 4, 042. 00
163 3,236.50
117 2,631. 00
119 2, 531. 00
152 2, 563. 00
169 3, 349.25
114 2,892. 00
141 3, 036. 25
129 2, 949. 75
124 2, 554.25
183 3,442. 50
190 3,828.50
127 2, 902.00
130 3, 452.00
107 2,100. 75
90 1,756.00
192 3, 582.25
151 3, 005.00
123 2,446.00
111 2,072. 00
129 2,159. 00
98 1, 952.00
162 2,714. 50

Pledged.
N um ­
ber.

161 $2, 938.00
150 3, 236. 75
122 2, 634. 25
118 2, 851. 50
94 1, 941.00
150 2, 544. 00
148 3, 907.00
115 2, 318.00
110 2, 352. 00
112 1, 986. 75
97 1,913. 50
163 3,113. 25
150 2,877. 00
120 2,653. 50
108 2, 352.00
99 2, 053. 50
86 1,640. 00
158 2,962.75
141 3,147.50
96 2,137. 25
97 2, 583. 00
110 3, 477. 75
73 1, 284. 00
137 2, 692. 75
150 3, 517. 50
136 3, 056.50

September.
Day o f week.

N um ­
ber.
M o n d a y .................................
T u e s d a y ...........................
W ed nesd ay............................
T h u rsd a y...............................
F rid a y .....................................
S a tu rd a y ................................
M o n d a y .................................
T u e sd a y .................................
W ed n esd a y............................
T hu rsday...............................
F rid a y .....................................
S a tu rd a y ................................
M o n d a y .................................
T u e s d a y .................................
W ed n esd a y............................
T hu rsd ay...............................
F rid a y .....................................
S a tu rd a y................................
M onday .............................. .
T u esd a y.................................
W ednesday............................
T h u rsd a y ...............................
F rid a y.....................................
S atu rd a y................................
M o n d a y .................................
T u esd a y.................................
W ednesday............................
T hu rsday...............................
F rid a y.....................................
Saturday ................................

Am ount
loaned.

N um ­
ber.

121 $2, 714. 00

95
95
167
143
118
69

88
122

1,495. 25
2, 050. 00
2,943.25
2,416.00
3, 024. 00
1, 336.00
2, 242. 00
2, 008. 25

129 3,350. 25
113 3.091.00
117 3,109.75
94 2, 092. 00
87 2,400. 00
126 2.375.00
127 2,974. 50
113 2.113.00
80 1.881.00
67 1,485.00
91 1, 707. 00
71 1,326.50
cl29 c2,088.75
90 2,596. 25
112 2, 836. 75
109 3, 302.25

a July 5, celebration o f Independence Day.
b December 25, Christmas Day.

Am ount
loaned.

96 $2,143. 50
106 2, 055. 00
83 1, 763. 75
284 5,195. 00
129 2, 505.00
133 3, 549. 75
92 2, 091.00
103 2, 353. 00
293 4, 783. 50

110
122
119
113

100
163
119

120

105
127
185
603
c235
131

88
100

Redeemed.
N um ­
ber.
89

100
88
78
99
184
89
90
77
80
79
208
85

88
96
64
73
225
82
87
83
80
67
205

110

128

A m ount
loaned.
$2, 213. 50
2, 455. 25
1 , 808. 00
1,731.50
2, 541. 50
3,192. 75
2, 253.50
2, 053. 00
1, 333. 00
1,561.00
1, 665. 51
4, 220. 00
1, 574. 00
1,925. 75
1, 846. 50
1, 381.00
1,398. 50
3, 775. 00
1,818. 00
2,416. 00
1, 730. 00
2, 430. 50
1, 373. 50
3, 972. 25
2, 574. 50
2, 665.00

December.

Redeemed,

Pledged.

Am ount
loaned.

2, 792.00
2,489. 00
2, 893.50
2. 391. 25
2, 221. 00
2, 081. 00
2, 799. 50
2,269.50
2, 305.00
2,299.00
4,444. 50
12, 890.00
c5, 311.50
2, 671.25
1, 556.00
2, 661. 50

Pledged.
N um ­
ber.

Redeemed.

Am ount
loaned.

N um ­
ber.

120 $2, 526. 50
122 3, 089. 00

99
103
81
184
116
109
103

91
146
157
134
133
103
124
157
166
91
152
115
124
188
187
138
135
149
164
(b)
185
123
127
123
127

1, 979. 00
2.740.50
3, 561.50
2, 706.50
2, 798. 75
2,190. 50
2,157. 50
2, 731.50
3, 398. 25
2, 420.00
3,490. 00
2.199.50
2,520. 50
2, 823.50
4.130.50
2.811.50
2, 359.50
3, 049. 75
2, 605. 50
(b)
4, 223.25
2,129. 25
2.157.75
3,182. 75
2.424.75

88

96
188
133
76
94
97
98
205
118
95
98
84
185
(b)
128
95

110
96
144

A m ount
loaned.

$2, 211. 50
1, 814. 00
1, 846. 50
3,863. 00
2,458. 50
2, 273. 50
2,125. 00
1, 889 50
2,191. 50
3,982. 00
2,702. 00
1, 886. 50
1, 749. 50
2,153. 75
2, 328. 00
4,124. 75
2, 637. 00
1,977. 00
1,906. 00
1, 873. 75
4,769. 00
(b)
2, 614. 00
1, 924. 00
2, 322.75
2, 747. 00
3, 734. 75

c September 27, H ebrew N ew Year.

The table gives data intended to show the effect of holidays on the
receipts and redemptions of the society. The month of August, having
no holidays, has been inserted for purposes of comparison, and will be
seen to correspond in general with the results given in the preceding



278

BULLETIN OF THE DEPARTMENT OF LABOR.

table. The remaining months—July, September, and December—have
been chosen to show, respectively, the effect of Independence Day, the
Hebrew New Year, and Christmas Day. In 1897 the Fourth of July
fell on Sunday and was celebrated on Monday, making it difficult to
tell what part of the increased number of pledges was due to usual
circumstances and what part to the coming celebration. One must,
however, conclude that the holiday in this instance had little or no
effect on the pawns of the Saturday previous, as the number of articles
was only 169, whereas on the third and fourth Saturdays of the month
the number rose to 183 and 192, respectively ; but, as in France, it is
the day following the celebration that witnesses the increase of busi­
ness, the number of pawns having risen to 211. Neither does the day
seem to have had any very large influence on the redemptions. The
result may in part be due to the fact that over 70 per cent of the bor­
rowers are of Hebrew descent, a point which materially affects the con­
ditions surrounding the Hebrew New Year, on the 27th of September.
On the Saturday preceding this great Hebrew fete day a very small
number of articles were pawned, but the number of articles redeemed
rose to 603 on Saturday and to 235 on Monday (the 27th), yet the num­
ber o f articles pledged on that day and on the days following did not
materially increase. On the Friday preceding Christmas the number
of articles redeemed did not vary materially from the number redeemed
on the preceding Saturdays, and again the number of articles pawned
the following Monday did not show an increase.
In the table following the number of articles received per day and
the amount loaned on the same by the pawnbrokers of Chicago
during July, 1898, are shown:
N U M B E R OF A R T IC L E S R E C E IV E D P E R D A Y A N D T H E A M O U N T L O A N E D ON T H E
S A M E B Y T H E P A W N B R O K E R S OF C H IC A G O D U R IN G J U L Y , 1898.
G old watches.
D ay o f
month.

1 .....................
2 ....................

N um ­ A m ount
ber.
loaned.

Silver watches.

107
91
149
234
123

121

$223.80
202. 55
406. 75
254.70
258. 90
254. 25
220.70
251. 25
231.60
283.60
158.75
144. 00
160.50
335.15
205.50
140.00
150. 25
152.50
123.00
207. 30
175. 65
158.50
134.35
133.50
101. 00
202. 50

T o t a l.. 5,160 40,242.35

2, 980

5,270.55

8 ....................
9 ....................
n .....................
12.....................
1 3 ...................
14....................
15....................
16.....................
18.....................
19....................
20....................
21.....................
22....................
23.....................
25.....................
26....................
2 7 ....................
28.....................
29.....................
30.....................




Jewelry.

Clothing.

N um ­ A m ount N u m ­ A m ou nt N um ­ A m ount N um ­ A m ount
ber.
loaned.
ber.
ber.
loaned.
loaned.
ber.
loaned.

132 $1,007.05
125 1, 329. 25
233 1, 729.75
263 2, 286. 75
219 1, 907. 50
173 1, 312.00
149 1, 329.00
227 1, 988. 25
238 2, 003.75
161 1, 279.50
182 1, 381. 50
135 1, 071. 50
144 1, 029.50
252 1, 717.50
236 2, 043.00
184 1, 233. 50
211 ; 1,653.25
71 i 1,267.00
113
917.00
296 2,017.00
275 1, 869.25
206 1,403.00
187 1,360.50
199 1,395.25
202 1, 370. 55
347 2, 340.25

4 ....................
5 .....................
6 .....................

R ings.

122

118
153

121

108

101
92
98
135

121

92
91
97
76
179
109
99
85
87
71

154 $1,403.85
120
907. 20
195 1,187.25
191 1, 384. 30
185 1,550.45
178 1, 319.00
164 1,997. 50
224 1, 065.15
139 1,325.70
172 1, 543. 90
210 1,126.10
101
781.55
175 1 991. 75
249 1,530.25
190 1,929.00
160 1,142.50
201 1, 603.55
189 1,182. 20
143
859. 35
294 1, 578.55
203 1,219.20
193 1,184. 75
195 1,349.40
168 1,174. 05
169 1,116.35
260 1,688. 25
4,822

U, 141.10

96 $1,524.10
70
558.45
94
738. 30
101 1, 293.40
82 1,194. 75
80
920.95
81
862. 00
105
877.50
99 1, 096. 75
92
825. 55
85
709. 00
55 1,013. 55
83 1,014.35
113
798.25
109 1,191. 00
73
879.20
60
546.14
62
386.85
494.75
60
156 2,132.00
104 1 , 226.00
99 1,034. 20
78 2,134.00
61
331.15
79 1,112. 05
99
947.10

176
60
301
305
332
228
257
292
325
293
192
278
214
321
305
205
180
193
154
294
265
288
196
240
308
341

$313.30
455.20
695.75
475.25
524.70
858. 65
549. 60
420.45
673.25
417. 75
501. 55
336. 30
368. 60
277.25
504. 50
215.60
363.85
336.10
230.25
447.15
410. 80
452. 35
298.75
359.70
314.60
543.20

2,276 25,841.34

6, 543

11, 344.45

X7y

PAWNBROKING IN EUROPE AND THE UNITED STATES.

N U M B E R OF A R T IC L E S R E C E IV E D P E R D A Y A N D T H E A M O U N T L O A N E D ON TH E
SA M E B Y T H E P A W N B R O K E R S OF C H IC A G O D U R IN G J U L Y , 1898—Concluded.

D ay o f
month.

M usical
instruments.
Number.

1 ....................
2 .....................
4.....................
5 ....................
6 ....................
7....................
8....................
9 ....................
11 ....................
12 ....................
13....................
14....................
15....................
16....................
18....................
19....................
20....................
21....................
22....................
23....................
25....................
26....................
27....................
28....................
29....................
30....................
T o t a l..

Firearm s.

A m ount
loaned.

Number.
16
15
24
37
38
24
27
30
28
18

$26. 06
27.25
13. 00
37.00
36. 65
17. 50
42.25
33.25
34. 00
19.50
30. 50
17. 50
31.75
29. 85
37. 50
14.10
47.75
39. 50
38. 35
29. 50
26.00

A m ount
loaned.

Number.

17

14.00
25. 50
30. 75
49.45

29

$19. 60
27. 25
44.55
65. 95
65. 90
44. 90
56. 00
97. 75
84. 00
44. 60
35.25
39.20
23.50
61.60
61.00
45.40
20.25
45. 50
18. 25
59. 65
32. 65
68. 25
18. 00
55. 35
15. 50
75.65

356

768.46

596

1,225. 50

15
17
7
16
19
9
19
19

20
7

12
12

18
19
13
9
13
16
13
15
13

8
9

11
12

22
22
15
32
18
31
13
23

20
31
17
24

20.00

10
22
10

Total.

Miscellaneous.
A m ount
loaned.

Number.

A m ount
loaned.

751
575

60
64
48
36
42
156

$112. 95
169. 70
280. 50
171.85
114. 30
140.85
195. 50
235. 90
167. 00
133.00
157. 85
584. 65
133. 50
193. 35
170.25
138. 50
143. 00
123. 50
95.00
1, 263. 45
162.70
143.10
93.75
99. 00
92. 90
99. 50

1,062
874
889
1,155
1,047
897
864
736
788
1,199
1,054
811
826
709
631
1, 366
1,046
981
808
824
893
1,370

$4, 630.71
3,676.85
5, 095.85
5, 969.20
5, 653.15
4, 868.10
5, 252. 55
4,969.50
5, 616. 05
4, 547.40
4, 100. 50
3,988. 25
3, 753.45
4, 943. 20
6,141. 75
3, 808. 80
4, 528. 04
3, 533.15
2, 775. 95
7, 734.60
5,122.25
4, 464.15
5,402. 75
3, 573. 50
4,153. 70
5, 945. 90

1,724

5, 415.55

24,457

124, 249. 30

57
77
98
53
64
60
74
105
77
46
60
41
41
78
62
57
57
58
52

101

1,101
1,200

The following table shows the number of articles received per day
by the pawnbrokers of Cleveland during July, 1897:
N U M B E R OF A R T IC L E S R E C E IV E D P E R D A Y B Y T H E P A W N B R O K E R S OF C L E V E ­
L A N D D U R IN G J U L Y , 1897.

D ay o f month.

1 .......................................
2 .......................................
3.........................................
5 .........................................
6 . . .....................................
7 .........................................
8.........................................
9 .........................................
10.........................................
12 .........................................
13.........................................
14.........................................
15.........................................
16.........................................
17.........................................
19.........................................
20.........................................
21 .........................................
22.........................................
23.........................................
24.........................................
26........................................
27........................................
28.........................................
29........................................
30......... ..............................
31.........................................
T o t a l......................




Silver
Gold
watches. watches. R ings.
37
17
24

68
21
26

20
32
30
33
39
29
26

22
31
37
27

21
21

18
44
25

12

4

6
10
13
14

12
12
9
7
13

8
11
8
5

11

5

11
7
9

11
14

11
11
14
15
16

J ew ­
elry.

9
13
13
13

20

6
6

3

3
4

9

10
11

35

22

4

11
12
11

19
24
28

20

7
3
9
4

16
16
18
15
18
17
29
17
25
15
16

10
8
11
9
5

20
3
9
5
4

20
5
30
13

9
32
24
50

12

20

3
5

775

279

506

205

12

1

Cloth­ Musical
instru­ F ire­ M iscel­ Total.
ing.
ments. arms. laneous.

6

11
8
13
5
9

8
9
9

11

5
9
13

8
10
4
5
3

8
20

2

10
8

2
2
2

17
7

4
3
3

2
2
2
3

1

3

2
1
1
2
2
2
1
2

9
4
4
14

3

229 j

35

4
3

2
1
3

2
1

6
13
3
5

12
8

9
17
15
5

6
8
2
3
4

16
23
18
14

2 i
1

8
6
20

1

21

16
19

12

12
4! I

322

71
60
81
118
84

112

72
90
98
104
98
89
81
64

86
85
95
93
77

94

98
91
79
54
115
92

111

2,392

280

BULLETIN OF THE DEPARTMENT OF LABOR.

The effect of holidays where one nationality does not predominate
may be considered in Chicago and Cleveland, the former for the Fourth
of July, 1898, and the latter for the same day, 1897. The number of
articles pledged on the Fourth of July in Chicago was 1,101, in con­
trast to 575 the day previous and 1,200 the day following. The latter
figure is really the significant one, since it shows a greater advance
over the usual number of articles pawned on Tuesdays than the former
does over the number reported on Mondays, this being due to the fact
that the pawnshops in Chicago do not close for Sunday, so that the
reports for Monday always include the business of two days. If, then,
we compare the 4th with the 11th, 18th, and 25th, we find that the
number of articles pledged on that day was only 52 above the average,
while on the 5th the number was some 300 above the average for the
12th, 19th, and 26th. While this increase following a fete day corre­
sponds with the European experience, it is not borne out by the result
obtained for Cleveland, where the increase in the number of articles
pledged was on the day of the celebration rather than the day after.
T H E C O L L A T E R A L L O A N C O M P A N Y OF B O S T O N .

One of the first attempts to apply the principle of the mont-de-piet6
to American conditions was made in Boston in 1859. It appears that
somewhat prior to that date the exorbitant charges of the pawnbrokers
had resulted in the appointment of a committee to examine the existing
conditions and suggest a remedy. The report of the committee, while
not exhaustive, evidences careful study, and is of peculiar interest as
giving a clew to the status of the pawnbroking business 40 years ago.
They reported “ upward of 50 pawnbrokers’ ” establishments in Boston,
“ most of them favorably located and exhibiting indications of thrift.”
But upon comparing their work with that of continental pawnshops
the committee gave it as their opinion that the facilities furnished the
needy by these offices were “ neither worthy of the age nor community”
in which they lived, and that they should be supplanted by institutions
similar to those in Europe. Following this report steps were taken
which resulted in the incorporation of what was known as the
“ Pawners’ Bank,” a name afterwards changed to the “ Collateral Loan
Company.”
The original charter provided that the bank should “ loan on pledge
of safe securities of every kind” and “ also on mortgage of goods and
chattels.” Its capital, to be raised by subscription, was divided into
shares of $100 each, and was not to exceed $300,000. The company
was, however, permitted to borrow on its own notes not to exceed the
amount of capital paid in, and for a period not to exceed one year.
Charges upon loans, to cover all expenses, including interest, were to
be uniform and not to exceed 1J per cent per month. So long as its
funds lasted loans were to be made on “ all goods and chattels embraced
within its rules and regulations, in the order in which they were offered,




PAWNBROKING IN EUROPE AND THE UNITED STATES.

281

with the exception that the bank” could “ always discriminate in favor
of small loans to the indigent.” In making loans four-fifths of the
value was to be advanced on gold, silver, and plate and two-thirds of
the value on all other goods and chattels.
The government of the bank was left in the hands of seven directors,
five of whom were chosen annually by the stockholders, one appointed
by the governor of the Commonwealth, and one by the mayor of the
city of Boston. Property pledged and not redeemed within the speci­
fied time, which could not exceed a year, was to be sold at public auc­
tion, and any surplus after loan charges and expenses of all kinds were
paid was to be held one year subject to the demand of the owner.
Although repeatedly amended the original provisions of the charter
have for the greater part prevailed, the amendments usually being
additions rather than modifications. Of these amendments the first,
made in 1865, was a most interesting one, in that it was similar to the
recent action (1892) taken by the Mont de-Piete of Paris. The amend­
ment of that year gave the bank power to “ loan on pledge of the
deposit books of the savings banks and on pledge of bonds and secu­
rities of the United States and the Commonwealth of Massachusetts,”
on which four-fifths of the value was to be advanced ; and, that the bank
might find profitable employment for its funds, the same amendment
authorized their investment in bonds of the Commonwealth of Massa­
chusetts or the United States. But this added field of business did
not produce sufficient revenue, and further legislation was asked for.
This time the remedy was not sought in an increase of business but in
rendering the present business more profitable. Not only was the leg­
islature asked to legalize a much higher rate of interest, but to repeal
the clause requiring uniformity of charges. This they did in 1869, save
that the amendment provided that interest and charges should not
exceed 2 per cent per month. Of this latter restriction the company
made bitter complaint, and at its annual meeting in 1872 the directors
recommended that a vote be passed authorizing them “ to take the
necessary measures to wind up the affairs of the company, if in their
judgment it should be expedient to do so;” the reasons assigned for
the step being the “ illiberal and oppressive action of the legislature,”
the increase of rents, and the consequent lowering of dividends. The
threat of dissolution was not without result, and the following March
the clause restricting the rate of interest was repealed and the company
exempted from the payment of taxes for that year. The final modifi­
cations of the charter, made in 1875, introduced a most commendable
feature, and one which the director of the Mont--de-Piete of Paris seeks
almost yearly to establish, viz, a means whereby the surplus arising
from the sale of the pawns and the profits of the business may become
the capital of the institution. By the charter of 1859 any surplus
arising from the sale of unredeemed pledges, unclaimed by the owner
within a year, went to the fund known as the “ profit and loss fund,” from
9986—No. 21---- 8



282

BULLETIN OF THE DEPARTMENT OF LABOR.

which fund the bank could recoup itself for any losses upon the loans,
due either to failure of title or otherwise. When, however, the surplus
was greater than the losses, the amount remaining was to be doled out
in fuel to the needy during the months of January, February, and
March. Moreover, the whole sum earned during each year was to be
disposed of at the end of the year. If the earnings were sufficient,
the stockholders were to receive an 8 per cent dividend on their invest­
ment, but any sum above that amount was to go to the profit and loss
fund, and be distributed among the poor. Under such regulations it
was impossible to increase the capital of the institution by funds nat­
urally its own. All earnings or surplus went cither to the stockholders
or to the poor, but the amount going to the poor seldom benefited
those from whom it was taken, thereby practically taxing one class of
indigents to support another. The remedy applied was the repeal of
the obnoxious clauses, leaving the bank free to make such a disposition
of the binds as it saw fit. Further, with the pledgingof savings bank
accounts, bonds, etc., introduced in 1865, the clauses relating to the
sale of unredeemed pledges and the disposition of the surplus naturally
applied to this form of pledges. But being of such undoubted secu­
rity, it was deemed unwise to subject them to possible loss by auction,
hence the following proviso was added in 1875: “ In case, however, the
savings-bank dejiosit book pledged to the company shall not be
redeemed within the time limited, it shall not be necessary for the
company to sell the same at public auction, but the said company may
convert the same or so much thereof as may be necessary to x>ay the
debt in such mode and at such time as in the judgment of the directors
will best secure the interest of the parties, holding the net surplus, as
above, for the owner.77
Management and Results of the Business.—The general plan
for the administration of the business is similar to that of the regular
pawnbrokers. When the company began business the interest rate
was fixed at 1 per cent per month, but this was found to be insufficient
to pay expenses, and the rate was raised to 3 i>er cent per month on
sums of $50 or less, but later reduced to the present rate of 1J per
cent per month. Interest on all advances must be paid for at least one
month, after the expiration of which time two weeks, or one-half month,
is the basis for reckoning, yet no loan is settled for less than 5 cents,
and on advances of $2 and over the lowest charge is 10 cents. All
advances are made for six months, and if the pawn is not redeemed or
renewed it is sold two mouths after the expiration of the loan period.
Charges for sale are usually 10 i>er cent of the sale price, and any sur­
plus remaining is held subject to the demand of the owner. In the
table following are shown for the company for the period 1860 to 1897
the number of loans, amount loaned, average loan, and average interest
per loan.




PAWNBROKING IN EUROPE AND THE UNITED STATES.

283

N U M B E R OF LO A N S, A M O U N T LO A N E D , A V E R A G E LO A N , A N D A V E R A G E IN T E R E S T
P E R L O A N , C O L L A T E R A L L O A N C O M P A N Y OF BOSTON, 1860 TO 1897.

Y ear.

1860.,
1861.,
1862..
1863..
1864..
1865..
1866.
1867..
1868..
1860..
1870..
1871..
1872..
1873..
1874..
1875..
1876..
1877..
1878..
1879..
1880..
1881.
1882..
1883.,
1884.,
1885.,
1886.,
1887..
1888..
1889..
1890..
1891..
1892..
1893.
1894.
1895.
1896.
1897.

ILoans. 1

A m ount
loaned.

5,288 $121,130.26
7,593
226, 508. 22
6,563 1 162,881.31
6, 224
148, 345.29
6, 813
155, 229. 90
9,921
209, 317. 03
9,665
223, 899. 80
1 9,553
280, 674.10
! 8,694
284, 598. 95
1 6,475
240,156. 54
7,216
260, 625. 55
6, 787
209, 605. 55
251,211.21
6, 529
6, 379
251,701.30
7,120
292, 361. 53
6, 691
276, 537. 28
9,413
537, 834. 87
9, 473
445, 909. 01
10, 338
257,155.46
12,710
319, 651. 58
' 14,486
374, 865. 68
16, 228
396, 427.18
17,282
414, 576. 52
18,232
439, 875. 35
21,186
439, 380. 42
24,537
474, 509.16
25, 540
479, 687. 73
1 25.974
575, 032. 35
28. 532
664, 908.12
19,694
591, 583. 30
29,158
671,595. 30
! 31, 604
705,745.34
33, 487
725, 741.15
' 37, 571
748, 212. 42
39, 783
677, 657.16
' 36, 797
618, 037. 35
43, 692
714,701.57
52,065
818, 816. 98

A verage
loan.
$22. 91
29. 83
24. 82
23.83
22. 78

21.10

23.17
29.38
32. 74
37.09
36.12
30. 88
38.48
39. 46
41.06
41.33
57.14
47.07
24.87
25.15
25. 88
24. 43
23.99
24.13
20. 74
19.34
18.78
22.14
23.30
19.92
23. 03
22. 33
21. 67
19.91
17.03
16. 80
16. 36
15. 73

A verage
interest
per loan.

$1.27
1.89
1.77
1.56
1.23
1.42
1.80
2. 06
2.26
2.83
2.85
2. 99
3.38
3. 71

2. 69
2.26
2.15
2.25
2.09
2.07
2.07
1.97

2.00

2. 30
1. 99
1.94
1.81
1. 57
1. 40
1.26
1.25
1.27
1.24

1.22

Tn comparison with the rapid increase of the business in the case of
the more recently founded associations, the progress of the Collateral
Loan has been slow. From 5,288 pawns received during the first year
of the business, the number rose to 9,921 in 1865, but after that grad­
ually diminished to 6,379 in 1873. By this time the critical period of
its history seems to have been passed, and from that date its advance
has been comparatively rapid, the number of articles received in 1897
being 52,065. In connection with this constant fluctuation and ultimate
increase it is interesting to note the average loan. From $22.91 in 1860
the average suddenly rose to $29.83 in 1861, and as quickly declined to
$24.82 in 1862. Indeed, throughout the period prior to 1880 this con­
stant fluctuation is predominant, the range of variation being from
$21.10 in 1865 to $57.14 in 1876. After 1880 the general tendency is to
decline, the lowest point, $15.73, having been reached in 1897. Natu­
rally the average interest received on each loan varies somewhat as the
average loan. In general, the average increased until 1874, when it
reached its maximum, due to the fact that the average length of loan
was 4 months and 15 days instead of 3 months and 12 days, as in
1861. After this the tendency is to decline, the lowest point having
been reached in 1897.



284

BULLETIN OF THE DEPARTMENT OF LABOR.

The following table shows for the company for the period 1860 to
1897 the capital stock, profits, reserve auction account, etc.:
C A P I T A L STOCK, P R O F IT S , R E S E R V E A U C T IO N ACC O U N T, ETC., C O L L A T E R A L L O A N
C O M P A N Y OF BOSTON, 1860 TO 1897.

Y ear.

1860.
1861.
1862.
1863.
1864.
1865.
1866.
1867.
1868.
1869.
1870.
1871.
1872.
1873.
1874.
1875.
1876.
1877.
1878.
1879.
1880.
1881.
1882
1883.
1881.
1885.
1886.
1887.
3888.
1889
1890.
1891.
1892.
1893
1894
1895
1896.
1897

Capital
stock.

N otes p a y­ Profit and
loss ac­
able.
count.

$74, 800
100, 700 . $12, 850. 00
100, 700
5, 917. 87
4, 333.66
100, 700
100,700
3,731.50
100, 700
8, 222. 00
113, 500
113, 500
15, 300. 00
24, 856. 50
113, 500
22, 000.00
113,500
113, 500
15, 000. 00
2, 000. 00
113,500
113, 500
10,500.00
120,400
120, 400
42, 500. 00
128, 600
38, 519. 77
129, 000
32, 242.81
150,000
53,314.26
150, 000
32, 045. 86
150, 000
25, 274. 60
150, 000
24, 510.00
22, 838.72
150, 000
150. 000
33, 829.46
150. 000
50. 586. 42
150, 000
00, 472. 85
150,000
32, 375. 47
150, 000
21, 018.17
150, 000
40, 318.17
57, 423.17
150, 000
50, 809. 82
150, 000
23, 200. 00
150, 000
150, 000
17,145. 00
150, 000
150, 000
150, 000
150, 000
5, 000. 00
196, 900
30, 000. 00
200,000
35, 000.00

Reserve
fund.

$2,372.72
2, 293. 20
3,417.71 J
2,341. 20
2, 427. 20
2,187. 28
2,195.27
1, 770. 23
4, 447. 63
4, 007.19
4,784. 50
9, 877.13
583.14
331. 93
3,320.15
2,560.63
7, 587.60
10, 337. 51
8,618.47
11, 594.57
10,028. 76
8, 618. 47
14,011.52
19, 653. 63
29, 874. 77
42, 829. 40
57, 472. 54
60, 669. 21
9, 595. 64
4, 590. 20
3, 621. 99
383. 70
3, 873. 46
5, 846. 39
8,492. 57
17, 954. 04

$50, 000
60, 000
70,000
75, 000
80, 000
85,000
90, 000

100,000

Reserve
auction ac­
count.

$264. 60
933.93
656. 58
740. 86
308. 76
640. 00
828. 50
439. 31
1,204. 35
674. 42
341.49
350. 25
352. 32
685. 82
486. 85
1, 250. 56
1, 439. 03
429. 02
557. 03
416.74
315. 57
283.52
173.10
330.18
125.47
401. 67
359. 66
1,116.45
477. 97
4, 718. 32
13, 319.12
7,376.18
4, 761. 87
3,460. 26
5, 498.14
5, 056. 90
2, 928. 28

The original capital of the company was $74,800, which was increased
the following year to $100,700, and five years later to $113,500. After
this three additions were made prior to 1877, when in that year it was
raised to $150,000, which sum met the needs of the business until 1896,
when the capital stock was raised to $196,900, and in 1897 to $200,000.
In addition to this the company was liable, in 1897, for $35,000 in the
form of notes payable.
Prior to 1874 the net profits (estimated) included an estimate of the
accrued interest on loans then outstanding but not collected. In 1874
and 1875, however, this estimate was omitted, which naturally reduced
the amounts for those years as they appear in the table. In 1876 this
item appeared in the reports of the company as u Undivided profits,”
and as such included any portion of the profits for the preceding year
which had not been paid out in the form of dividends. For this reason
the $3,320.15. is not to be considered as the net profit for 1876, but as
the profits for that year supplemented by an indefinite sum from the
profits of the previous year. In 1890 this account was again changed,
and $50,000 was placed under the head of “ Eeserve fund” and the



PAWNBROKING IN EUROPE AND THE UNITED STATES.

285

balance under “ Profit and loss.” This also precludes an exact state­
ment as to the profits of the company, but since 1890, aside from pay­
ing an annual dividend of 8 per cent on its stock, the reserve has been
gradually increased to $100,000, besides which $17,954.04 remains in
the profit and loss account. This latter account, however, at times
includes such a portion of the unclaimed surplus as the directors may
from time to time see fit to transfer from the reserve auction account.
The reserve auction account is the surplus arising from the sale of
unredeemed pledges, which surplus is held subject to the demand of
the rightful claimants. Contrary to European practice the company
does not limit the length of time that such sums will be held, but holds
itself ready to advance the amount whenever the tickets are presented.
As a matter of fact, however, although sales usually net from 15 to 17
per cent above the amount advanced, but a conrparatively small num­
ber of patrons call for the surplus due them, one of the company’s
officials giving it as his opinion that less than 10 per cent of the
amount due is ever claimed.
The success of the company led it to establish a branch office in
another part of the city, but it was found that the patrons preferred to
deal with the main institution unless the branch office would give them
better terms. This being impossible, they went to the main institution,
and as a result, after the loss of some $3,000, it was thought advisable
to give up the effort.
T H E W O R K I N G M E N 'S L O A N A S S O C I A T I O N O F B O S T O N .

As the philanthropic citizens of Boston were the first to demonstrate
that a pawn shop charging a moderate rate of interest could be made
profitable, so we are indebted to them again for the model used by the
chattel mortgage and loan associations formed for a like purpose. In
Boston, as in many other large cities, there were numerous agencies for
loaning money at exorbitant rates of interest upon chattel mortgage
of furniture and other personal property, the rate of interest charged
varying from 3 to 10 per cent per month; a rate so exorbitant that the
unfortunate borrower could hardly hope to cancel his debt and must
ultimately lose his property. Among those to fully appreciate the
extent of the evil was Robert Treat Paine, who sought to ascertain if
money could not be loaned on this iorm of security at a more reasona­
ble rate. To this end, beginning August 1, 1887, he caused experi­
mental work to be conducted along this line, which gave such favorable
promise that March 8, 1888, the Workingmen’s Loan Association was
incorporated, and April 19 of the same year began business.
According to the act of incorporation the society is formed “ for the
purpose of loaning money upon pledge or mortgage of goods, chattels,
and securities of every description, or upon mortgage of real estate,
subject to all the duties, restrictions, and liabilities set forth in the gen­
eral laws relating to such corporations.” From this wording it is seen



286

BULLETIN OF THE DEPARTMEMT OF LABOR.

that it was at first intended to do a pledge or pawn business, but while
this was the original intention little endeavor has been made to carry
it out. At first a few articles were taken in pledge, but proving a
source of loss the idea has been entirely abandoned, and the work of
the association confined exclusively to the chattel mortgage business.
By the terms of the act the government of the corporation is vested
in a board of directors, chosen as the by-laws prescribe, provided that
one shall be appointed by the governor of the Commonwealth and one
by the mayor of the city of Boston. In accordance with this the by­
laws direct that the board shall not exceed sixteen in number, including
the president of the company, vice-president, its treasurer, and clerk.
All officers to be chosen by ballot at the annual meeting of the stock­
holders and to hold their offices until their successors have been qualified.
A t the regular quarterly meeting of the board five members present
constitute a quorum, provided that not less than one half of the capital
stock is represented; but a majority of the stockholders present and
voting may adjourn from time to time until the business shall have
been finished. Absent members may vote by proxy, and in all meet­
ings each stockholder is entitled to one vote for each share owned by
him.
That the operations of the institution may be under the usual control,
the act of incorporation jirovides that the commissioners of the savings
banks shall have access to the vaults, books, and papers of the company ;
that it shall be their duty to inspect, examine, and inquire into the
affairs of the association, and to take action in regard to them in the
same manner and to the same extent as if the corporation were a sav­
ings bank. By this it is hoped to keep the goods of the company under
the same strict legal control as all banking institutions of the Common­
wealth are under.
A person desiring to secure a loan, upon presenting himself at the
place of business of the company, is carefully questioned, and if the
circumstances seem favorable for making the loan desired he fills out
an application blank bearing the following questions:
Name in full?
Amount of loan ?
W hat security?
Where is it situated?
Where is your present residence?
How long have you resided there?
W hat is your business ? Where ?
Have you receipted hills for the property?
Does all the property belong to you?
Is there any encumbrance on it?
Name two references?
W hat amount of principal will you pay monthly?
Do you agree to pay interest promptly ?
Is your property insured and for how much ?

I f the replies to the questions are satisfactory, an appraiser is sent to
the applicant’s home, who makes a schedule of the articles he wishes to



PAWNBROKING IN EUROPE AND THE UNITED STATES.

287

give in security, placing against each article the price that in his judg­
ment it would bring if sold at auction. Upon this schedule the loan is
based, three-fourths of the total estimate value, as a rule, being
advanced. In all cases the borrower is required to show receipted
bills for his furniture, or to account satisfactorily for the absence of
the same. This is done not alone to prove ownership, but in case the
articles have been purchased on the installment plan to show that they
have been fully paid for. After this the records are examined to ascer­
tain whether the property is in any way encumbered. In most cases
inquiry as to the character of the borrower is made, not alone of persons
referred to in the application blank but of other persons also. If after
this rigid examination the loan is found to be an admissible one, the
borrower signs a mortgage and note for the amount borrowed and
receives the money less the expenses charged. Where the borrower is
a married person the signatures of both husband and wife are required.
The mortgage, in pursuance to the law, is recorded in the city where
the borrower resides and also in the city or town hall of the place where
he principally does business, and usually contains a clause covering all
furniture and household effects of every kind in his house.
The rate of interest charged is 1 per cent per month, an additional
charge being made on making the loan in order to cover all money
expended in the investigation and recording of the mortgage, and to
give the company in ordinary cases $1.65 for the time spent in appraisal
and drawing papers. The amount of the monthly installments on all
sums of $50 or over is 4 per cent of the loan plus accrued interest at 1
per cent per month. On sums of $25, which is the smallest amount
loaned, an installment of $2 per month plus the interest is paid. In
case of default of this installment for more than ten days, a notice is
sent calling the attention of the delinquent to the fact. For this a
charge of 10 cents is made. If, however, the first notice proves futile,
a more imperative one is sent, for which a charge of 25 cents is made.
These notices serve a double purpose; besides warning the debtor of
his delinquency they inform the company if he has changed his abode,
as in that case the notices are returned by the postal authorities.
Moreover, the heed that the borrower gives to these notices enables
the company to estimate the danger of losing its loan, and permits it
to shape its measures accordingly; but only in unusual cases are fore­
closures made within three or four months from date of delinquency.
The risk of the company from the danger of loss by fire is met by
requiring an insurance in its favor. If, however, the amount does not
exceed $100, the borrower instead of taking out an insurance policy is
permitted to make a small yearly payment to the company. This
charge is 50 cents on loans of $50 or less, and $1 on sums of from $50 to
$100. In a few cases this system has been extended to loans of from
$100 to $200. The receipts from this source are credited to the risk
fund, Avhich appears in the table of receipts and general expenditures,
from which it will be noted that the receipts from this source have



288

BULLETIN OF THE DEPARTMENT OF LABOR.

risen from $53 in 1888-89 to $1,606.07 in 1897-98, an increase which,
shows the feasibility of this form of insurance. At the same time the
company lias been careful not to assume the position of an insurer, so
that in case of loss by lire they are losers only to the amount of the
loan.
The number of loans made, capital stock, dividends, surplus, etc., of
the Workingmen's Loan Association for the period 1888-89 to 1897-98,
are shown in the following table:
L O A N S,

Y ear.

C A P IT A L

Loans.

STOCK, D IV ID E N D S , SU R PLU S, E T C ., OF T H E
L O A N A S S O C IA T IO N , 1888-89 TO 1897-98.

Am ount
loaned.

Average
loan.

Am ount
repaid.

A m ount
outstand
ing.

Surplus.

i
1888-89...
1889-90...
1890-91...
1891-92...
1892-93...
1893-94...
1894-95...
1895-96...
1896-97...
1897-98...

781
909
875
840
1,092
1,231
1, 305
1, 380
1, 468
1, 675

$99, 398. 38
94,177.52
81, 043.15
73, 506.26
101, 547.84
109, 702.21
119, 732.98
122, 726.43
134, 474.53
151,660. 90

$127. 27 $22,143.83 ' $77, 254. 55
103.61
67, 097.29 104, 334.78
92. 62
80, 944. 24 103. 375. 84
76, 059. 92
87.51
99, 866. 98
92. 99
80, 591. 81 119, 709. 06
89.12 110,446. 34 118, 286. 89
91.75 113, 834. 08 123,195. 53
88. 93 113, 405. 69 131,599. 70
91.60 ( 119,394.53 146,437. 67
90. 54 127, 867.53 169, 869. 00

W O R K IN G M E N ’ S

D iv i­
dends
(per
cent).

2
6
6
6
6
6
6
6
6

4

$879. 70
2, 333. 28
3, 333. 53
3, 775. 64
5, 054. 48

Capital
stock.

$78, 200
78, 500
78,500
78, 500
89, 500
90, 400
90,400
91, 900
93, 900
125, 000

B or­
row ed
funds.

$25,000
25, 000
25, 000
28,000
26, 000
27, 000
28, 000
35,000
25,000

The act of incorporation provided that the capital stock of $25,000
must be subscribed and entirely paid in before the association began
business. The provision, however, was unnecessary, for prior to the
time the association was ready to begin work $66,600 had been sub­
scribed, and before the close of the year the amount was raised to
$78,200. This capital was called in gradually to supply the borrowers
who had eagerly sought the advantages offered. By March, 1889, less
than one year from the time the company began business, the whole
capital was loaned. During the second year the capital was increased
to $78,500 and $25,000 borrowed for use in the business. With this
amount the work was conducted for the two following years, when the
capital stock was increased to $89,500, and the borrowed funds to
$28,000, which sums practically met all necessities during the three
succeeding years. In 1897 the capital stock was increased to $100,000
and in 1898 to $150,000. Of this last increase of $50,000 but $25,000
was offered to the stockholders, all of which was taken at par and paid
in, thus raising the paid-in stock to $125,000 and fixing the actual
working capital at $150,000.
From a financial standpoint the record of the association is one of
the best. After the payment of usual taxes and all expenses, the
profit of the first year permitted the declaring of a 2 per cent dividend,
and left a slight surplus not mentioned in the company’s reports. The
following year, although losses proved heavy, it was able to pay a 4
per cent dividend, and from that time on 6 per cent dividends have
been regularly paid and a constantly increasing surplus secured.
Since the association has been able to loan all the money it had on




PAWNBROKING IN EUROPE AND THE UNITED STATES.

289

hand and many times, due to lack of funds, has been compelled to
restrain the number of applicants, the amount loaned has varied almost
directly with the increase of the capital, but not so with the number
of loans, which has increased far more rapidly than the amount loaned,
necessitating a marked decrease in the average value of the loan. In
this the experience of the association is quite the reverse of that of
like organizations. Instead of the average loan increasing with the
increase of the capital, it has decreased from $127.27 in 1888-89 to
$90.54 in 1897-98, the lowest point having been reached in 1891-92,
when the average was $87.51. This shows an admirable tendency in
that it indicates that the officers of the association have held to their
original purpose of loaning small amounts to those in need rather than
accepting safer and more profitable loans.
In the following table is shown the expenses, receipts, and risk fund of
the Workingmen’s Loan Association for the years 1888-89 to 1897-98:
E XPE N SE S, R E C E IP T S, A N D R IS K FU N D OF T H E W O R K IN G M E N ’ S L O A N A SS O C IA ­
TION , 1888-89 TO 1897-98.

Year.

2888-89. ............................................................................................
1889-90.................................................................................................
1890-91..................................................................................................
1891-92..................................................................................................
1892 93
1893-94.................................................................................................
1894-95.......................................'.........................................................
1895-96..
.
......................................................................
1896-97.................... „ ...........................................................................
1897-98.................................................................................................

R eceipts.

E x­
penses.
(a)

Interest.

Charges.

$2, 484. 62
4, 334. 34
4,331.12
4, 368. 23
5, 822. 03
6, 611. 47
7,246.74
7, 234. 44
8, 264. 84
9, 241. 74

$4, 367. 66
10, 456. 49
12,133. 92
12, 029. 06
12, 555. 81
14,104.42
14, 020. 30
14, 563. 63
16, 096. 99
18, 398. 89

$337. 58
734.92
732.67
802.77
1, 659. 64
3, 001. 01
3, 224. 78
3, 477. 54
3, 683.18
4, 301. 91

R isk
fund.
$53.00
108.57
302. 75
347. 46
609. 81
841. 85
997. 72
1,162. 73
1, 352. 56
1,606. 07

a N ot including interest on borrow ed capital or taxes.

From the above figures it will be seen that the charges have increased
quite out of proportion to the loans made, as given in the preceding
table. This is explained by the fact that from 1888 to 1893 the regular
charge for making a loan, registering the mortgage, etc., was only $1.50,
but as this sum was quite insufficient to cover the expenses necessarily
incurred, the charge was increased in January, 1893, to $2.50, and in
some cases to $3, At present this is the usual amount, but where it
requires more than the usual expenditure of time and trouble to inves­
tigate the loan, this sum is increased so as to cover the actual expense.
ST. B A R T H O L O M E W ’S L O A N A S S O C I A T I O N OF N E W Y O R K .

The experience of the Workingmen’s Loan Association of Boston led
the members of St. Bartholomew’s Protestant Episcopal Church of New
York, in 1894, to attempt a similar enterprise under the name of St.
Bartholomew’s Loan Association. The organization, although under
the direction of prominent members of St. Bartholomew’s Church, is
entirely undenominational, and, though similar in some respects to a
charity, is, on the contrary, a purely business association, differing in



290

BULLETIN OF THE DEPARTMENT OF LABOR.

no wise from other loaning companies, save that it advances money at
a more reasonable rate.
Organized for the same purpose as the association in Boston, and
loaning money on the same kind of security, it naturally models its
business methods after those of the former association. Almost with­
out exception its blanks are like those used by the Workingmen’s
Loan, or are modeled after the same. Loans of from $25 to $200 are
made on security of furniture in use. All advances made are payable
in monthly installments of such amounts and at such times as are
agreed upon at the time of making. Charges for making loans are
uniformly a $1 application fee, which is not returned if the loan is not
made, and $2 additional where the loan is accepted. Aside from this
no other charge is made save for interest, which is fixed at the rate
of 1J per cent per month, although the law permits the association to
charge 3 per cent per month.
The following table shows the receipts and disbursements of St.
Bartholomew’s Loan Association for the years 1896 and 1897:
R E C E IP T S A N D D IS B U R SE M E N T S OF ST. B A R T H O L O M E W ’ S L O A N A S S O C IA T IO N , 1896
A N D 1897.
Disbunsements.

Receipts.
Items.

1896.

Balance at close o f fiscal
y e a r ...................................
Installm ents repaid...........
Interest on lo a n s ...............
Fees on m ortgages.............
Interest on deposits ..........

$7,714. 86
43, 693. 74
2,160. 55
1, 999. 64
186. 89

1897.

Items.

Loan fu n d ........................ $39,175.00
$11,001.15 I Petty-cash vou chers----1,164. 80
39,289.97
Salaries..............................
3, 942. 01
3, 143. 87
98. 50
Stationery and printing.
1,712.00
* 19. 94
M essenger service.........
162.77
354. 28
M iscella n eou s.................
Total
disburse­
ments .................
Balance..............................

T o t a l..........................

55, 755. 68

1896.

55,309.76

1897.
$41, 000. 00
1, 653. 04
3, 578. 84
204. 50
3.30

200.00

1
44,754.53 1
11,001.15

46,639.68
8,670.08

55, 755. 68

55, 309. 76

Although the association has been doing- business over four years,
the reports of the work for 1896 and 1897 are alone available. These
show that in 1896 693 loans for a sum total of $38,968 were made, and
that in the year following the number of loans decreased to 598, while
the amount loaned increased to $42,577. The average loan for 1897
was $71 against $56 for the preceding year. The decrease in the num­
ber of loans made is seen in the decrease in the amount received from
fees on mortgages, and the increase in the amount loaned has increased
the interest received from $2,160.55 in 1896 to $3,143.87 in 1897.
T H E P R O V ID E N T L O A N S O C IE T Y O F N E W Y O R K .

A special act of the legislature incorporated the Provident Loan
Society for the purpose of “ aiding such persons as said society shall
deem in need of pecuniary assistance by loans of money at interest
upon a pledge or mortgage of personal property.” No mention is
made as to the amount of capital or as to the disposal of the surplus



PAWNBROKING IN EUROPE AND THE UNITED STATES.

291

earnings of the company, leaving the subject entirely in the hands of
the directors themselves. By it the company is made subject to the
general corporation laws, and the management of its business is placed
in the hands of its chosen directors, subject to the constitution and
laws of the State. It is further provided that the rate of interest paid
on borrowed money for corporate purposes shall not exceed the lawful
rate, and that no member or trustee of the society is to receive any
compensation for his services or any profit other than the lawful inter­
est on money loaned the company, nor shall any member or trustee
be personally liable for any debt incurred by the society. The remain­
ing section gives the act immediate effect, and authorizes the company
to act as a pawnbroker, subject to the laws of the State concerning
pawnbroking, except that it is not required to obtain a license or file a
bond.
The act of incorporation secured, the constitution was at once
formulated and adopted. By its terms the membership of the society
was limited to three classes of persons: Its corporators; such persons
as the incorporators chose to associate with themselves at the time of
their organization, and any person who thereafter became a holder of
a certificate of contribution to the society of not less than $500, or who
was elected a member by the vote or assent in writing of three-fourths
of its board of trustees, or of all the members of its executive com­
mittee. With these the following persons were to be associated as
ex officio members: The mayor of the city of New York, the comptroller
of the city of New York, the president of the police department, the
president of the department of charities, and the presidents of the
following-named societies, viz, the Charity Organization Society of
the City of New York, the Association for Improving the Condition of
the Poor, the Society of St. Vincent de Paul, and the United Hebrew
Charities.
The management of the business and affairs of the society is given to
a board of trustees chosen by the members of the society out of their
own number. The term of service is fixed at three years, one-third of
the board retiring yearly, thus necessitating the annual election of five
members. These new members are elected at the annual meeting of
the society; but in recognition of the aid the Charity Organization
Society rendered in its founding the election of one of the five is sub­
ject to the nomination of that society. The principal officers—the presi­
dent, secretary, and treasurer—are usually chosen from the board of
trustees, the president not being eligible for more than three successive
terms. The board of trustees appoints such other officers as may be
needed and elects an executive committee of six members, who, in con­
nection with the president, secretary, and treasurer as ex-officio mem­
bers of that committee, exercise all the powers of the board of trustees
between the times of its meetings. The annual meeting of the society
is held on the first Monday in February and the meetings of the board
of trustees on the first Monday in February, April, and May.



292

BULLETIN OF THE DEPARTMENT OF LABOR.

Funds for the corporate purposes of the society may be obtained
from the following sources: First, gifts and bequests; second, contri­
butions made on condition that the contributor shall receive a certifi­
cate for the amount given entitling the holder to such amount, not
exceeding in any year the lawful interest on* the sum contributed, as
the trustees may determine to pay pro rata to certificate holders out of
the earnings; third, loans at a rate of interest not exceeding in any
year the lawful rate.
Finally, although the act of incorporation makes no stipulation as to
the rate of interest to be charged, the constitution provides that it
“ shall not charge or receive any interest on loans made by it of a
greater amount than one-half of the iuterest which pawnbrokers are
now authorized to charge by law.” Thus is the maximum interest fixed
at 1J per cent per month, the legal rate being 3 per cent per month. It
does not seem probable, however, that the maximum will be charged,
since, as will be seen later, the 1 per cent charged to date has met all
the needs of the society.
Appreciating that the process of incorporation and the framing of
the constitution was vastly inferior in importance to the practical
organization of the business, the Provident Loan Society decided to
spare no pains to ascertain the best method of practical organization.
To this end Mr. James Speyer, the present treasurer of the society,
visited the monts-de-piete of Paris, Frankfort on the Main, and other
places in order to thoroughly acquaint himself with European methods
of administration. After an extended study Mr. Speyer returned and
took largely upon himself the organization of the business. While
modeling his system of bookkeeping and other regulations upon those
he had witnessed in operation in Europe, he effectually eliminated what
Americans are wont to term the “ red tape” of European administra­
tion, and has given the society a most comprehensive set of pawn books.
Appreciating that the success or failure of the scheme depended largely
upon the ability to steer clear of the pitfalls which a certain class of
customers introduce, the society decided to employ a successful pawn­
broker as superintendent and supply him with competent assistants.
While such a policy meant a large increase in the running expenses,
results have vindicated its wisdom. The superintendent being thor­
oughly acquainted with the value of articles usually offered in pawn
and the tricks of those who would exploit the pawnbroker secures the
society against unexpected losses, while the courteous and efficient
service of the entire personnel does much to remove the opprobrium
too often attending the business. A t the same time all transactions
with the public have been on a strictly business basis. No loan has
been made except upon security believed to be adequate, while, with a
few exceptions, its other business methods have been analogous to
those adopted by the regular pawnbrokers. These exceptions naturally
furnish a statement of the reforms the society has introduced, and are




PAWNBROKING IN EUROPE AND THE UNITED STATES.

293

summed up as follows in its first annual report: “ The charge for inter­
est has been at the invariable rate of 1 per cent per month, or fraction
of a month if over three days, instead of the legal pawnbrokers’ rate
of 2 or 3 per cent per month, according to the amount or duration of
loan. The payment of the loans by installments has been invited and
accepted. Notice of the sale of unredeemed pledges was mailed to
every borrower whose address was known to the society and opportu­
nity given to redeem at any time before actual sale, which would not
take place from three to six months after the due date of the loan. No
charge whatever was made for tickets, or for storing goods, for wrap­
ping or hanging them up, or for incidental expenses, which in practice
have been made by some pawnbrokers.”
The capital of the Provident Loan Society on December 31, for the
years 1895, 1896, and 1897, is shown in the following statement:
C A P I T A L OF T H E P R O V ID E N T L O A N S O C IE TY , 1895 TO 1897.

Items.

1895.

1896.

1897.

i
Certificates o f con tribution...................... . ...................................................... $100, 000 $136, 000
100,000 136, 000
Debenture bon d s...................................................................................................
loqns
_ _____ _________________________ __________ ______
10,000 60,000
Cali loans ........................ .....................................................................................
Total ...........................................................................................................

210, 000

1

332, 000

$200, 000
200, 000
20, 000
10, 000
430,000

Although the society began business May 21, 1894, with a capital of
not less than $100,000, yet this* sum was found to be inadequate. By
September 5 the whole amount had beenfioaned and the treasurer had
been authorized to borrow $40,000 on the notes of the society, bearing
5 per cent interest, and maturing at the close of the year. The follow­
ing December, for the purpose of funding these notes and providing
additional resources, the society authorized the issue of 5 per cent
debenture bonds to the aggregate amount of $100,000; but so rapid was
the increase of the business that by the close of 1895, although all its
bonds had been sold, it was necessary to secure a temporary loan of
$10,000, making the total capital $210,000. The following year, in order
to meet the growing demands upon the society, an endeavor was made
to increase the contributed funds by $100,000; but, due to unfavorable
financial conditions, the project was dropped. During the year, how­
ever, $36,000 was contributed, additional debenture bonds of like
amount sold, and $60,000 borrowed from trust companies, thereby
increasing the capital to the sum of $332,000. In 1897, the stringency
of the times having partially passed, a second effort was made to
increase the capital stock. In this no difficulty was experienced and
$64,000 was added, raising the contributed capital to the sum of
$200,000. This allowed a like increase of the debenture bonds, mak­
ing it only necessary for the society to borrow $30,000 on time and
call loans, the aggregate capital December 31, 1897, being $430,000.




294

BULLETIN OF THE DEPARTMENT OF LABOR.

The number and amount of loans and average loan on articles pledged
and redeemed at the Provident Loan Society for the years 1894 to 1897
are shown in the table following:
N U M B E R A N D A M O U N T OF L O A N S A N D A V E R A G E L O A N ON A R T IC L E S P L E D G E D
A N D R E D E E M E D , P R O V ID E N T L O A N SO C IE TY , 1894 TO 1897.
A rticles pledged.
Year.
Number.

A m ount
loaned.

j

A rticles redeemed.

A verage Number.
loan.

A m ount
loaned.

A verage
loan.

1894....................................................
..........................
1895...........
1896....................................................
1897....................................................

14, 234
20,804
28,218
36, 772

$229,155. 50
377, 845.00
560,403.50
764, 926. 50

$16.10
18.16
19.86
20.80

22, 616
33,283

$84,174. 50
322, 596. 50
427, 522. 00
689,975. 50

$15.10
17. 71
18. 90
20. 73

T o t a l .....................................

100, 028

1, 932, 330. 50

19.32

79,688

1, 524, 268.50

19.13

5, 575
18, 214

Little comment is required to explain the above figures. The most
striking feature is the marked increase of the business, made possible
by liberal subscriptions to the stock. It is seen that the amount loaned
in 1897 was more than double the amount in 1895 • yet it would be
incorrect to assume this as necessarily indicative of success. Not the
amount loaned, but the amount redeemed is the true standard. If,
however, we turn to the redemptions we find they have increased in
like ratio, which indicates that the capital is being constantly turned,
and so productive.
A point of interest to one familiar with the pawn business is the
average value of the pledges. In this .instance, however, the interest
is not so much in using thi$ average as a basis of estimate as a basis
of comparison. One is surprised to find the average loan to be some
four or five times the amount loaned in France or Germany and three
times the sum usually loaned in America. But once acquainted with
the actual work of the society one readily perceives the cause of the
difference. In the first place, because of the lack of storing facilities,
the society receives little if any clothing in pawn. For the same rea­
son furniture and very bulky commodities are refused, leaving articles
alone eligible which have a high value relative to the space they
occupy, as watches, rings, and all kinds of jewelry or plate. Of like
importance is the fact that occupying, as the society does, quarters
quite similar to those of a bank, and being under the patronage of
well known men, it receives in pledge the property of a well-to-do class
o f citizens, who, because of prejudice or otherwise, would not place
their valuables in the hands of the regular pawnbrokers. To this
class of patrons was due 8G0 loans of $100 or over made in 1897.
Loans of this character are in such marked contrast to those of 10 or
25 cents so often advanced by pawnbrokers on articles of apparel that
the high average value seems a logical consequence. A point more
difficult to explain is the constant increase in the average value of the
pledges. From $16.10 in 1894 the figure has risen to $20.80 in 1897.
One of two things must have happened, either the appraisers grant
a larger loan on the same article than formerly, or a bel ter class of



P AWN BROKING IN EUROPE AND THE UNITED STATES,

295

pledges is being received. The latter is probably the case. With the
development of the society it has gained the respect of a class who,
formerly considering it a regular pawn shop, would have no dealings
with it, but who since have trusted their valuables to its keeping.
Pledges unredeemed at the expiration of the loan period, usually three
months, are subject to sale at public auction, but as a rule, in order that
the owner may have the greatest possible opportunity to redeem his
property, the article pledged is not sold for from three to six months
after the expiration of the loan. When, however, the sale is actually
determined upon, besides its advertisement in the city xiapers, the owner
of each unredeemed pledge is notified by letter that unless redeemed
prior to a certain date his pawn will be sold at public auction. As
previously mentioned, this letter of notification is one of the reforms
introduced by the Provident Loan Society, which experience seems to
have justified. The loss saved the society by the large number of
pledges redeemed, just prior to or during the sale, more than compen­
sates it for the expense incurred. The result is that the percentage of
the goods sold at auction in 1897 of the total amount loaned was only
1.64, while the corresponding per cents for 1895 and 1896 were 2.47 and
2.04, respectively. This favorable showing, however, is not alone due
to the extended time of payment and the letters of notification, but also
to the ability of a large class of its clients to readily meet their obliga­
tions, and the opportunity given its poorer patrons to repay an advance
by installments of not less than $1. In the table following the auction
sales of jewelry and clothing made by the Provident Loan Society for
the years 1895 to 1897 are shown:
F I N A N C I A L R E S U LTS OF A U C T IO N S A LE S OF PLE D G E S, P R O V ID E N T L O A N SO C IE TY ,
1895 TO 1897.
PLEDGES

j
Year.

OF J E W E L R Y

SOLD A T A U C T IO N .

CommisTotal
N um ­ A m ount
sion and amount
Interest. expenses due sober.
loaned.
o f sale, j ciety.

Gross
amount
realized
by sale.

Pledges givin g 1 Pledges givin g
surplus.
loss.
N um ­
N um ­
ber. Surplus. ber.

305 $2, 850. 00 $497.03 $655.57 *$4,002.60 $4, 372. 45
658 7,017.50 1,297.32 1,436.38 1 9,751.20 9, 583. 30
512 7, 747.00 1, 379. 60 1,575.10 '10,701.70 10,497.16

182 $698.26
269 1, 007. 85
234
818. 75

T ota l.. 1,475 17, 614. 50 3,173. 95 3,667.05 24,455.50 24, 452. 91

685 2,524.86

1895...........
1896...........
1897...........

PLEDGES

183

1896...........

356. 50

85. 36

123
389
267

$328.41
1,175. 75
1, 023. 29

779

2, 527. 45

O F C L O T H IN G SOI D A T A U C T I O N .

58. 21

500. 07

391.49

Grand
total. 1, 65.8 17, 971,00 3, 259. 31 3,725.26 24,955.57 24, 844. 40

1

1
1

Loss.

37

29.79

146

722 2, 554. 65

925

If the increased business and payments of interest are indicative oi
the forethought and business sagacity of the organizers of the society,
the result of the auction sales indicates the efficiency of the personnel.
All appraisement of pledges must be made on the supposition that the
articles will ultimately come to sale. The task is an especially difficult



296

BULLETIN OF THE DEPARTMENT OF LABOR.

one. Where clothing is received the probability of a change of fashion
a year hence must be considered, while in case jewelry alone is
accepted financial depression or other unfavorable conditions may
hinder sales. Aside from these considerations the appraisers must be
careful not to advance the sum the pawn will bring at auction, but
an amount which together with interest and 15 per cent on the auction
price as commission and expenses of sale will equal the sum realized.
For instance, the perfect appraiser would not have advanced $17,971
on the 1,658 articles sold, but some $111 less, in order that the sum
advanced, interest, and charges together would have equaled the gross
amount realized at auction, $24,814.40.
While the showing in the table bespeaks the ability of the appraisers,
other sources have contributed to the result. A t least one or more
days prior to sale, all articles intended for auction are placed on exhibi­
tion that any one contemplating purchase may have an opportunity to
examine them at their leisure. A catalogue, giving the description
and number of each article, as well as the weight of the gold, sil­
ver, and plate, is placed at the disposal of the visitor that he may the
better find and make note of any lot he may wish to bid upon. A t the
time of the sale all articles are sold to the highest bidder, who is
required to make a deposit of 25 per cent of the purchase price, but to
prevent inaccuracy in delivery and general inconvenience, no purchase
can be removed during the time of the sale. If, however, after mak­
ing the deposit the purchaser fails to call for the article within two
days he forfeits his deposit and the article is again sold, either at pub­
lic or private sale, any deficiency attending such resale to be made
good by the defaulter. A reference to the table will show how far
these efforts have been successful. Comparing the total amount due
the society on the articles of jewelry sold with the gross amount real­
ized at sale, it is seen that a loss of only $2.59 has been incurred, a
result that would be extremely difficult to duplicate. But with the
articles of clothing the appraiser has been less successful, and the loss
incurred by their sale increases the total difference to $111.17. But
this sum of $111.17 does not represent the actual loss of the society,
as the entire sum realized is not at its disposal. As previously men­
tioned, any surplus arising from the sale of a pawn is held subject to
the demand of the owner, while a loss is not borne by the owner but
by the society. To what extent the society is liable to suffer and its
patrons be benefited by the rule is shown by the remaining columns
of the table. It is seen that 722 pawns have produced an aggregate
surplus of $2,554.65, which is held subject to the demands of the
owners, while 925 pawns have incurred an aggregate loss of $2,665.82.
From this it would appear that the society has been a loser to the full
amount of the loss account, but such is not the case. The surplus
mentioned, while conscientiously held subject to the demands of the
rightful claimants, is not always demanded. Many persons leave the
city before the sale of their pledges, while others are negligent, or



PAWNBROKING IN EUROPE AND THE UNITED STATES.

297

believing that no surplus will be realized never call for their money,
consequently the society has the use of their funds. Indeed, of the
$2,554.65 surplus but $504.98 had been claimed prior to December 31,
1897, leaving $2,049.67 as a part of the funds of the institution. While
it is true that a considerable portion of this amount will be claimed, it
is also true that a large part of it will remain unclaimed. To say that
$500 more will be called for is a high estimate. However, to ascertain
the total loss the society has sustained, we must consider $505.30 for
the settlement on stolen goods and $76.46 for other losses.
From a financial standpoint the results obtained have so far exceeded
the expectations of its founders. At the time of its organization, Mr.
Speyer expressed the belief that the society would possibly make
expenses, but that contributors need not expect any return on the
funds contributed. The result, however, has been quite the contrary,
for at the close of 1895, besides paying all expenses and interest on
borrowed funds, the society was able to pay a 6 per cent dividend on
the contributed capital, and have on hand a surplus of $4,309.94,
which was used to start a reserve fund. The following year all expenses
were again met, a 6 per cent dividend declared, and the reserve fund
increased to $10,696,035 and in the year just closed (1897), the usual
dividend has been paid and the reserve fund increased to $25,680.
Aside from the financial results, the members of the society have been
gratified to note the effect their competition has had on the rates of
other brokers. Several of the brokers in the city have found it neces­
sary to reduce their rates of interest, or by loaning a more liberal
amount than heretofore, have sought to hold their custom. Further,
its success has induced the people of Buffalo to follow its example, and
has also led citizens of Brooklyn, Chicago, and Detroit to seriously con­
sider the feasibility of such an institution. Finally, their uniform suc­
cess has determined the society to open a branch office in the East Side
tenement district of the city, and already excellent accommodations
have been secured on the ground floor of the University Settlement
building, now in process of erection. This step was decided upon
early in the spring of 1896, but because of the inability of the Univer­
sity Settlement to secure funds to complete its building, and the society
to secure a capital more than sufficient for the work of the main office,
the plan was held in abeyance. Uow, however, sufficient capital has
been subscribed, and a branch office, which will advance money on all
sorts of pledges, will be opened in the heart of the tenement district of
the city.
T H E P R O V ID E N T L O A N C O M P A N Y OP B U F F A L O .

The evils of the chattel-mortgage business in Buffalo reached their
height under the so-called u negotiated loans.’7 Persons not wishing
to assume direct responsibility for the rates of interest they charged
gave out that they were simply empowered by an unknown principal
to negotiate loans. Under this cloak they charged from 10 to 15 per
9986—No. 21-----9



298

BULLETIN OF THE DEPARTMENT OF LABOR.

cent per month, with an extra charge of $5 to cover expenses incurred
in making the loan. The disastrous effects that naturally followed
such terms, coupled with the obnoxious methods pursued by the
“ negotiators ” and the agitation aroused throughout the State by the
passage of the law of 1895, led to the formation of the Provident Loan
Company.
As others of its class, it positively disclaims the character of a chari­
table society, and contends that it is a purely business corporation,
seeking to do a legitimate business in the class of small loans, with as
much economy of management and as small charges to the borrowers,
consistent with safety, as will insure moderate dividends on its capital,
never to exceed G per cent per annum.
The business of the society is managed by a board of directors con­
sisting of eleven members, each of whom must be a stockholder of the
company, owning at least five shares of stock, and a resident of the
State of Kew York. Directors are elected for three years, four retiring
the first and second years and three the third. I f any director ceases
to be a resident of the State, or a bona fide owner of five shares of stock,
his office is considered vacant and may alone be filled by a vote of a
majority of the remaining members. Regular meetings of the board
occur every two months; but special meetings may be called by the
president or by any three directors upon one hour’s personal notice or
one day’s notice by mail.
The officers of the company are president, vice-president, secretary,
treasurer, and manager, the duties of each being such as usually fall
to like officers, those of the manager being by far the most extensive.
To him is given the work of passing upon applications for loans, exam­
ining property, and preparing mortgages and other securities. He
must keep complete books showing in detail each transaction of the
company of which he has charge, and make monthly reports to the
treasurer. In his custody are all mortgages, securities, aftd papers of
the property which has been pledged or mortgaged to the company.
He may draw checks on the company’s funds for loans, but no check
may exceed $ 200.
The company began business September 9, 1895, with a subscribed
capital of $20,000. During the remainder of the year calls were made
for additional sums as the business required, and before its close other
subscriptions were,obtained and paid in which raised the capital stock
to $24,750. Since this time the amount has been increased until at
present the company has a capital of $50,000, but up to date only
$32,000 of this has been issued.
The method of doing business follows closely that of the Working­
men’s Loan Association of Boston. An applicant for a loan is required
to fill out an application blank (similar to the one previously described)
and make a deposit of $1 to cover the expense of investigation and
appraisement. This sum is not returned if the loan is refused, and if
made, an additional sum of $2 is required to pay for registering the mort­



PAWNBROKING IN EUROPE AND THE UNITED STATES.

299

gage and incidental expenses connected therewith. Loans are restricted
to chattel mortgages on furniture in use, and applicants wishing to
secure loans on horses, carriages, books, i)ictures, merchandise, store,
shop, and office furniture, and machinery are refused. As a rule, not
over two-thirds of the auction value of the security is advanced, nor is
it expected that this sum shall exceed $200 or be less than $25. All
loans are paid in monthly installments of at least 5 per cent of the
original loan plus interest for a month in advance upon amount remain­
ing unpaid. For the present the interest rate is fixed at 3 per cent for
the first month and 2 per cent for each following month; but it is the
intention of the company, as soon as the business will permit it, to
reduce the rate of interest to 1 per cent per month on all loans.
Following is a statement of the loan account of the Provident Loan
Company from September, 1895, to June, 1898:
STATEM EN T

OF T H E L O A N ACCOU N T OF T H E P R O V ID E N T L O A N C O M P A N Y ,
S E P TE M B E R , 1895, TO JU N E, 1898.
A m ount
loaned.

M onth.

Principal Loans out­
received. standing. Earnings.

Expenses.

1895.
S e p te m b er...........................................................
O c to b e r ................................................................
N ovem ber.............................................................
D e ce m b er......... ..................................................

$4,123.00
4, 438.10
3, 745. 00
3, 023. 00

$15. 00
472. 50
580. 68
805. 68

Total (4 m on th s ).....................................

16, 229.10

1, 873. 86

$4,108. 00
8, 073. 60
11, 237.92
14, 355. 24

$330.69
450. 69
450. 87
539.04

$194.25
772. 43
61.24
573.68

1, 771. 29

1 , 601. 60

588. 53
545. 37
599.75
571. 50
625.13
649.45
691. 31
662.24
706. 66
782.86
679. 33
726.83

337. 57
344. 33
403. 93
334.34
339.37
376.05
402. 49
335.07
373. 93
399.72
341. 27
399. 55

7, 828.96

4, 387. 62

801.31
728.49
803.92
775.96
734.45
784.89
749.58
753.47
751.66
762.91
767. 60
833.16

409.14
443.33
457. 38
411. 95
425. 23
425.45
410.60
556.99
439. 31
476. 48
402. 02
405. 25

9, 247.40

5, 263.13

818.70
728.83
906.30
757. 81
770. 90
802.20

486.13
456. 58
504. 38
1, 099.27
729. 61
475.40

1896.
3, 580. 00
2, 890.00
3,045.00
2, 815.00
3, 230. 00
2,740. 00
2, 840. 00
2, 960. 00
3, 330. 00
3, 830. 00
3, 000. 00
2, 835. 00

January................................... ............................
F e b r u a r y .............................................................
M arch....................................................................
A p r il......................................................................
M a y ........................................................................
J u n e ......................................................................
J u l y ......................................................................
A u g u s t .................................................................
S e p te m b er...........................................................
O c to b e r...............................................................*
N ovem ber................. ..........................................
D ecem b er.............................................................

962. 68 16, 972.56
1, 023. 77 18, 838. 79
1, 453. 31 20,430.48
1,499. 33 21, 746.15
1, 960. 27 1 23,015.88
2,106.07 23, 649.81
1, 990.11 24,499.70
2, 026.68 25, 346. 77
2, 316.08 26, 341. 29
2, 624. 21 27, 498. 08
2, 598. 95 27, 899.13
2, 633. 88 28,100.25

37,095.00

23,195. 34

J an uary................................... ...........................
F e b r u a r y .............................................................
M a rch ....................................................................
A p r il......................................................................
M a v........................................................................
J u n e ......................................................................
J u l y ......................................................................
A u g u s t .................................................................
S eptem b er...........................................................
O c to b e r.................................................................
N ovem ber.............................................................
D ecem b er.............................................................

3, 880. 00
3,105.00
3,075. 00
3,218. 00
3, 635.00
3,050. 00
2, 795. 00
3, 033.00
2, 774. 00
3, 250. 00
2, 925.00
4, 560.00

2, 717.41
2,962.05
3, 241. 51
3,177. 67
3,105.36
2, 886. 50
2,960. 26
2, 845.40
3,149.11
3, 085.88
3, 010.73
3, 541.97

T otal...........................................................

39, 300.00

36, 683. 85

T ota l.................... .......................... .........
1897.

'
29, 262. 84
29, 405.79
29, 239.28
29, 279.61
29, 809.25
29, 972.75
29,807.49
29, 995. 09
29, 395.99
29, 560.11
29,474. 38
30, 492. 41

1898.
Jan u a ry................................................................
F ebruary .............................................................
M arch....................................................................
A p r i l ....................................................................
M a y ........................................................................
J u n e ......................................................................

3, 635. 00
2, 840. 00
4, 610. 00
3, 335. 00
5, 441. 50
3, 953. 00

3, 076. 64 31, 050.77
2,933. 09 30,957. 68
4, 043.54 31, 524.14
3, 090. 84 31, 768. 30
3, 303.84 ' 33,905.96
3,115. 26 34, 743. 70

Total (6 m on th s)............. ....................

23,814.50

19, 563.21

Grand t o t a l ..............................................

116, 438. 60

81, 316. 26

4, 784.74

3, 751. 37

—




23,632.39 |

15^00^72

300

BULLETIN OF THE DEPARTMENT OF LABOR.

Aside from the fact that the company has loaned $116,438 in the two
years and ten months for which data are given and can show a-net
profit of $8,628.67, its Chief pride is in the fact that with ‘the aid of
the law of 1895 it has been able to drive the unegotiated loan” out
existence. Within recent months, however, a new competitor has of
arisen. Three or four companies have been formed which loan money
at the same rate as the Provident, save that payment by installment is
not taken, thus requiring the borrower to pay interest on the full
amount of his loan until canceled. It remains to be seen whether
these newly formed companies will be able to compete with the Provi­
dent. A natural supposition is that they, too, must in time loan as it
does or withdraw from the field.
Prom the first the company has intended to loan upon pledge of
personal property, but not until May 1, 1898, did it actually receive
pledges. It refuses to take articles in pledge other than jewelry. The
rate of interest or charges is 2 per cent per month, or a fraction thereof,
instead of 10 per cent, as is usually charged by the regular brokers.
Loans are made for three months instead of one, and may be paid by
installments in sums of not less than $1 plus the interest. A t this date
no statement as to the possible outcome of the undertaking may be
made.
L A W O F N E W Y O R K A S TO T H E F O R M A T I O N O F C H A T T E L M O R T G A G E C O M P A N IE S .

The agitation which resulted in the establishment of the Provident
Loan Society of New York, supplemented by the constant friction
which the immoderate rates of interest charged by chattel-mortgage
companies aroused, led to a sort of crusade against the pawnbrokers
and mortgage companies. The newspapers exposed their methods
and quoted their rates of interest, while the Provident Loan of New
York and the Workingmen’s Loan of Boston, with their constantly
increasing dividends, demonstrated the feasibility of charging a mod­
erate rate of interest on mortgaged or pledged goods. To men inter­
ested in philanthropic matters the results shown by these organiza­
tions were sufficient to induce them to apply to the general assembly
for the passage of a special law legalizing the formation of companies
or associations such as the above. To this end they secured in 1895
the passage of a bill entitled “ An act to provide for the incorporation
of associations for loaning money on personal property and to forbid
certain loans of money, property, or credit,” which act, amended in the
same year, finds present application.
As to the incorporation of such associations the act provides
that uin any county of this State having a population of more than
300,000 inhabitants, according to the latest enumeration taken by
the State, any three or more persons may organize and become a cor­
poration for the purpose of aiding such persons as shall be deemed in
need of pecuniary assistance, by loans of money at interest, not exceed­



PAWNBROKING IN EUROPE AND THE UNITED STATES.

301

ing $200 to any one person, upon a pledge or mortgage of personal
property, by making, signing, acknowledging, and filing a certificate in
the form prescribed by the business corporation law, and by filing a
bond in an amount equal to one-tenth of its capital stock, but not less
than the sum of $5,000, with the superintendent of the banking depart­
ment, with sufficient sureties, to be approved by him, for the faithful
observance of all general provisions of law regulating business corpo­
rations within the State of New York and the provisions of this act; and
thereupon the persons who shall have signed the said certificate, and
their associates and successors, shall be a corporation of the name stated
in said certificate.77
If the above bond is not refiled in January of each year, the associa­
tion must cease to do business within thirty days thereafter, and
proceedings for a dissolution instituted. Also at the time of the
filing of the bond a report for the previous calendar year must be
made to the superintendent of the banking department, giving such
information as he shall desire. Further, that the usual adherence may
be had to all the provisions of the act, it is provided that “ if any such
corporation shall knowingly violate any of the provisions or restrictions
of this act, the said bond shall be forfeited and shall be collected by
suit by the superintendent of the banking department, in the name of
the people of the State, which suit shall be conducted by the attorneygeneral; and a reward of $250 shall be paid by the State to the person
first giving information and furnishing legal proof of such violation.77
Corporations so formed are given all the general powers of a business
corporation. They may act as pawnbrokers within the county for
which they are chartered, subject to and entitled to all the provisions
and benefits of the laws of the State and of all the ordinances of the
city in which they are located, except that they shall not be required
to obtain a license or file a bond other than the one previously men­
tioned. Any such corporation may lend to such persons within the
county as shall be deemed in need of pecuniary assistance, and may
take as security for the payment of any such loan either a pledge or a
mortgage of any personal property without the actual delivery to it of
the property pledged or mortgaged, together with other lawful securi­
ties. On all loans made upon articles pledged or mortgaged, but
not actually delivered, it may charge interest or discount at a rate not
exceeding 3 per cent per month for a period of two months or less, and
not exceeding 2 per cent per month for any period after the expiration
o f two months, and also a sum not exceeding $3 for the first examina­
tion of the property to be pledged or mortgaged and for drawing and
filing the necessary papers; but no loan whatever shall be greater than
$ 200, nor shall anyone owe the corporation more than $200 for princi­
pal at any one time.
No such corporation is allowed to pay in any year a dividend of more
than 10 per cent on its capital stock, and after a surplus equal to 50 per
cent of its capital has been accumulated the superintendent of the



302

BULLETIN OF THE DEPARTMENT OF LABOR.

banking department, upon ascertaining that the corporation has dur­
ing the previous year made a net profit amounting to more than 10
per cent on its capital, is authorized to issue an order reducing the
rates of interest, discount, and charges which the corporation may
legally charge and receive upon loans to such sums as will in his
judgment produce a net return of 10 per cent on its capital stock.
Such an order shall take effect at such time, not less than four months
after it is made, as the order shall name, and shall be of force for one
year from that date, unless sooner revoked.
Aside from the constructive portion, the act contains an important
prohibitory clause which gives a corporation or organization loaning
on the foregoing plan a sort of monoply. From the statement pre­
viously made as to charges it will be seen that aside from the $3 fee
an interest charge of 2 per cent per month is legalized. Section five of
the act, however, provides that “ in any such county no person or cor­
poration, other than corporations organized pursuant to this act, shall,
directly or indirectly, charge or receive any interest, discount, or con­
sideration greater than at the rate of 6 per cent per annum upon the
loan, use, or forbearance of money, goods, or things in action less than
$200 in amount or value, or upon the loan, use, or sale of personal
credit in anywise, where there is taken for such loan, use, or sale of
personal credit any security upon any household furniture, apparatus
or appliances, sewing machine, plate or silverware in actual use, tools
or implements of trade, wearing apparel, or jewelry.” This provision
is further made to apply to “ any person who, as security for any such
loan, use, or forbearance of money, or for any such loan, use, or sale* of
personal credit as aforesaid, makes a pretended purchase of property
from any person and permits the owner or pledgor to retain the pos­
session thereof, or who, by any device or pretense of charging for his
services or otherwise, seeks to obtain a larger compensation in any case
hereinbefore provided for.”
It will be seen that this prohibitory clause does not hinder the for­
mation of associations which may compete with one another, but it
does, however, make it a misdemeanor for associations not organized
in pursuance of the above law to charge more than the rate above
mentioned, the idea being to hinder the use of this semiphilanthropic
cloak to conceal exactions, which the present law attempts to render
impossible.
The foregoing provisions of section five do not apply to licensed pawn­
brokers, making loans upon the actual and permanent deposit of per­
sonal property as security 5 nor do they affect in any way the validity
or legality of any loan of money or credit exceeding $200 in amount.
T H E W O R C E S T E R C O L L A T E R A L L O A N A S S O C IA T IO N .

The Worcester Collateral Loan Association of Worcester, Mass., was
created by act of the Massachusetts legislature and approved by the
executive April 17, 1896. The act of incorporation was accepted and



PAWNBROKING IN EUROPE AND THE UNITED STATES.

303

organization effected June 22, and business commenced November 21
of the same year. Its object is threefold: To alleviate the distress of
the self-supporting poor who are oppressed by usurious rates of interest;
to enable people of smaller means to borrow the necessary money on
reasonable terms, and to accomplish this end by means of a self-sup­
porting and reasonably profitable business enterprise.
The general plan of conducting the business is similar to that pur­
sued by like organizations already described, save for the variations in
charges. On loans amounting to $25 the association requires the pay
ment of $2 in advance; from $25 to $100, $3; from $100 to $200, $4;
above $200, $5. All loans made are payable in monthly installments
of at least 5 per cent of the principal, together with accrued interest
at 1 £ per cent per month on the part of the loan remaining unpaid.
In the actual work the association has realized the gratifying results
which have been the lot of similar organizations. From November 21 ,
1896, to April 1, 1898, a period of less than eighteen months, it has
loaned $48,508.68 on 739 loans, $1,767.33 of which has been repaid.
Starting with a capital of $10,000 it was found necessary the following
May to double that amount. A year later $10,000 more was required*
and in October following $15,000 was added, making a total capital of
$45,000. A t the end of the first four months the association was able
to pay all expenses and declare a dividend of 4 per cent on its capital.
Since that time two dividends of $600 each have been declared, and
May 1,1898, a surplus of $2,047.48 remained on hand, of which $470
was carried over from 1897. This makes an earned surplus of $1,577.48
for the past year.
As has been the experience of several similar institutions, the asso­
ciation has drawn much of its business from those who advertise to
“ negotiate loans/7and has been the means of modifying the high rates
of interest charged in many other cases. The field for loaning money
to people of small but independent means has been a matter of surprise
to the officers of the association, in that it is larger than was expected.
They find that a large number of their loans have been made to persons
“ who do not have the kind of securities required by the banks, but
who would not ordinarily borrow from money brokers.77 It is in this
field, as well as the one formerly occupied by the “ negotiated loan77
men, that the association hopes to prove a benefit to the city of
Worcester.
T H E C H A T T E L L O A N A S S O C IA T IO N OP B A L T IM O R E .

One of the most recently established chattel loan companies, which
expects ultimately to do a regular pawn business, is the Chattel Loan
Association of Baltimore, founded to combat the same evil that led to
the formation of all kindred organizations. The association began
operations May 12, 1898, with a capital of $30,000, fully subscribed,
$15,000 of which has already been called in. Up to August 1, 1898, or
during the first 67 days the association was doing business, it had



304

BULLETIN OF THE DEPARTMENT OF LABOR.

received applications for $7,884.80, and upon these it had granted 93
loans, aggregating $6,245.80, of which $5,698.45 was outstanding at
that date.
Its method of doing business varies but little from that followed by
similar institutions already described, the chief difference being in its
application blanks and charges. In the Chattel Loan Association the
application blank assumes more the form of a contract than in the
other associations. In addition to the questions mentioned in the
application blank of the Workingmen’s Loan Association the applicant
is asked from whom he acquired his property,’ if acquired by the
installment plan, whether all the property belongs to him, and if not,
what portion of it does. Besides this he is to fill out and sign the fol­
lowing blank:
I hereby make application for a loan of $------ for a period o f ----------months, in
accordance with the rules and by-laws of this association, and agree to pay in
advance at the office of the association the sum of $------for expenses and prelimi­
nary examination of security offered; and should said loan he made I further agree
to pay in advance to the said association the further sum of $------ for expenses of
search of records and recording, etc., of the mortgage to be given; and I further
agree to pay to the said association, for the use of the said principal sum of $------ , if
loaned, interest at the rate of 6 per cent per annum for said period o f ------ months
and until paid, said interest to be p a id --------- . I hereby agree to repay said princi­
pal sum of $------ , if loan is made, in eq u a l--------- payments of $------- o n --------day of
each ----------until said principal sum of $------- is repaid in f u l l -----------; and I offer as
security therefor the following property: --------- .

In the way of charges $1 is usually required at the time of the appli­
cation, and if the loan is granted $4 additional, making a total charge
of $5, the price usually charged by the original chattel mortgage com­
panies. But this charge of $5, instead of $2.50 or $3 as is the case in
other institutions, is offset by the fact that the association charges but
6 per cent per annum, the lowest rate charged by any chattel mortgage
company of which we have cognizance. As a rule no loans for more
than $200 or less than $25 will be made. A t present, however, due to
the abundance of capital which the company has on hand, and the ease
with which it can secure additional funds, an advance of over $200 is
made.
In making a loan care is taken not to advance more than three-fourths
of the appraised value of the security, and that the appraiser may be
truly impartial he is never informed of the amount desired by the appli­
cant. Yet little difficulty is met in this line, for so far the experience of
the company has been that the amount applied for is ever clearly within
the limit. All loans are paid on the installment plan, the amount of the
installment being ascertained by dividing the loan by the number of
months for which it is made instead of fixing that 4 or 5 per cent be
paid, as is the case in other companies.
It is interesting to note the source of the loans which the company
has made up to date. Of the 93 contracted some 40 were taken out
of the hands of the chattel mortgage men, who were charging from



PAWNBROKING IN EUROPE AND THE UNITED STATES.

305

66§ to 120 per cent per annum. Another line of business which the
association has almost entirely usurped is that of making deposits for
the street-car conductors of the city. Each conductor in Baltimore is
required to deposit with the company $50 in cash as security. As many
of these men did not have such an amount of money on hand they were
obliged to call on the above companies, who charged them 50 cents per
week interest on the money needed for such deposit. Condemning this
exorbitant charge on a loan which was absolutely safe, the Chattel Loan
Association fixed the rate at $8 per annum in advance, or about 16
cents per week. As a result several companies that made a specialty
of such loans have been forced out of business.
T H E W O R K I N G M E N ’S L O A N A S S O C IA T IO N O F P R O V ID E N C E , R. I.

Prior to 1898 no agency existed in Providence which would advance
money on chattel mortgage of furniture at a lower rate than 3 per cent
per month, while in many instances 12 per cent per month was asked
and received. In 1895 these exorbitant rates attracted the attention of
several philanthropic men, who took steps to establish an association
similar to the St. Bartholomew’s Loan Association of New York or the
Workingmen’s Loan Association of Boston. But unfortunately the
charter they secured required them to obtain a capital of $50,000,
which they were unable to raise. For this reason the matter was
dropped until the latter part of 1897, when Mr. Spencer, impressed by
the fact that excessive rates of interest were being paid on $83,000 worth
of mortgages against furniture alone, again took ux> the matter. By a
personal canvass he raised $25,000, and later was successful in securing
a new charter permitting the formation of an association on this basis,
and on January 28,1898, the Workingmen’s Loan Association of Provi­
dence began business.
Its method of doing business follows closely that of the Working­
men’s Loan of Boston, its blanks in several instances being copies
of those in use by that association, such changes as are made arising
from the difference between the laws of Rhode Island and those of
Massachusetts. Loans are made for an indefinite period on mortgage
of furniture. If, however, the furniture is not of sufficient value to
secure the loan desired, a team is at times taken in-addition thereto,
but loans are never made upon the latter security alone. The interest
charged is 2 per cent per month, and each month the borrower pays an
installment of at least 3 per cent of the principal and the accrued
interest on the part of the principal remaining unpaid. Primarily the
association intended to charge but 1 per cent per month, but due to
tlie smallness of its capital it was found necessary to make the rate 2
per cent. It is, however, expected that this rate will shortly be reduced
to 1 or 1 J per cent per month. The charge for making a loan varies
from $2 to $3. Foreclosures in all instances are a matter of judgment.
If the installment is due and the debtor does not meet the payment,



306

BULLETIN OF THE DEPARTMENT OF LABOR.

the usual notices are sent him, which failing, a personal visit is paid.
Up to date, however, the company has not been called upon to make a
foreclosure.
The work of the association so far has been very satisfactory. A t
first it was usual to have as high as twenty applications awaiting the
action of the society, but at present, as the demand has been in part
met, the number has lowered to some three or four per day. A t the
end of the first five months of business, 205 loans were outstanding, on
which the sum of $15,000 had been loaned, $2,000 of which had already
been repaid. The greater part of the business has consisted in the
taking up of loans made by other chattel-mortgage firms, upon which
from 5 to 10 per cent per month, and in one case 16 per cent, was
charged.
HEBREW

F R E E L O A N A S S O C IA T IO N O F N E W Y O R K .

An association holding an unique position is the Hebrew Gemilath
Ohassodim Association, or to give it a more readily comprehended title,
the Hebrew Free Loan Association. Its aim, as stated in an annual
address of the president, uis to loan to any responsible person when in
need a certain sum of money as the by-laws of the association provide,
upon a note with the indorsement of a responsible party, without charg­
ing any interest or expense, and the debtor may pay off his debt in
weekly payments.” Within the view of its president, Rev. Zinsler, the
association is not a charitable one. “ We do not give away,” he exclaims,
“ but we loan away, and request our money in return.” In a similar
vein the preamble of the constitution states “ that in considering the
ways and means by which to reduce pauperism and beggary, to encour­
age the idea of self-support among the poor, and to prevent them sink­
ing into pauperism and becoming a charge upon the community, it has
been found advisable to organize an association whose object shall be
to loan to those in need certain sums of money, and thus assist respect­
able people, whose character and self-respect abhor the thought of
receiving alms to overcome the difficulties of their struggle for
existence.”
The* management and administration of the society are vested in a
board o f directors, thirty-six in number, elected annually upon the
nomination of a committee of eight members appointed by the presi­
dent, acting in conjunction with such members of the board as are
candidates for reelection. The only disqualification for office is that
no one whose father, son, son-in-law, brother, or brother-in-law is
holding the office of president, vice-president, treasurer, financial sec­
retary, or corresponding secretary can be elected to any one of these
offices for the same term his relative serves. The work of the board is
to a great extent advisory, the direction of the association being left
largely in the hands of the president, who, by the constitution, is required
to execute every law; to sign all warrants on the treasurer; to take
charge of the official seal, drafts, and bank books, and all valuable papers



PAWNBROKING IN EUROPE AND THE UNITED STATES.

307

of the society; to call all special meetings; to appoint all its salaried offi­
cers, and to sign all formal documents. In the appointment of the
salaried officers, however, such, as the financial and corresponding sec­
retaries, as also the fixing of their salaries, the action of the board is
required.
The income and expenditures of the Hebrew Free Loan Association
for the years 1892 to 1898 are shown in the following table:
IN CO M E A N D E X P E N D IT U R E S OF T H E H E B R E W F R E E L O A N
TO 1898.

Incom e.
M em bership d u e s ...
D o n a tion s .................
S y n a g o g u e s __________

W orship s e rv ice ___
Theaters.....................
P i c n ic s ________________

1892.

1893.

$920. 40 $1, 029. 30
493. 28
288. 53
69. 56
59.51
183. 30

$957. 21
177.15
75.17

124.12

220.99
7.00

214. 65

1895.

1894.

1896.

1897.

A S S O C IA T IO N , 1892

1898.

$871.75 $969. 55 $2, 244. 32 a$2, 084. 77
90. 39 1,857.80 11, 482. 27
a 174. 55
50. 07
60.33

a 103. 90
a 75. 00

$9,077.30
14, 563. 97
314. 64
183.30
423. 85
345. 77
83.21
61. 60
103.90
75. 00

a 2, 438. 22

25, 232.54

202. 86
83. 21

B a l l s ..........................
R eturned r e n t _____
Interest from b a n k .
M iscella n eou s.........

12.00

49. 60
i

T o t a l............... 1, 483. 09

1,899.56 jl, 437. 52 1, 274. 93 2, 972. 63 13, 726. 59

Total.

1892.

1893.

1894.

1895.

1896.

1897.

1898.

Total.

S ta tion ery.................
P ostage......................
P rin tin g .....................
R e n t............................
C ollector....................
Financial secretary.
Recording secretary
P araphern alia.........
M iscella n eou s----L egal expense
Office expenditures .
C h a rity......................
A ssistant secretary.

$21.23
26. 98
52. 90
53. 50
158.19
240. 00
30. 00
4.80
3.20

$11.49
39. 00
19.10
62. 00
216. 48
321. 00
35. 00
12. 50
2.80

$11. 48
49. 35
35. 05
114.00
179. 20
424. 00
40. 00
54.40
1.91
25.00

$7. 21
29. 70
11. 45
152. 00
174. 79
416. 00
40. 00
5. 50
4. 00

$8. 37
34. 70
32. 50
164. 00
199. 26
444. 30
40. 00
36.41
9. 05
5. 00
51.53

$18. 76
90.76
112. 75
196. 00
314.98
587. 70
52. 50

a$13.18
a 67. 50
a 184. 55
a 121. 50
a 252.36
a 312.00
a 32.50

87.67
11.50
85.49

a.47. 31

59. 67

a 160.50

$91.72
337. 99
448. 30
863.00
1,495. 26
2, 745. 00
270. 00
113. 61
155.94
61.50
144.18
38.07
220.17

T o t a l ...............

628.87

867.81 1, 025.12

1,617.78

a l, 191.40

6,984. 74

Expenditures.

20.00
7.16

38. 07

1

719. 37

934.39

a F irst six months o f year.

The larger part of the income used in the work of the association is
derived from donations and membership fees. To secure as large a
sum as possible from the latter source a somewhat elaborate system has
been devised. According to the plan, the members proper are divided
into three classes, namely, those paying $10, $5, and $3, respectively,
per annum. Aside from these regular members, there are so-called
patrons, those who pay $25 per annum; life members, those who have
contributed $100 to the funds of the society; founders, those who have
donated the society the sum of $ 2,000; and, lastly, members after whom
funds are to be named, or those who bequeath the society the sum of
$5,000 or more. The additional methods used to swell its funds will be
seen by reference to the income account in the table. Church collec­
tions have produced $497.94, picnics have netted the association
$345.77, a ball given in 1898 added $83.21 to the funds, while other
small sums have been received in the annual course of the business.



308

BULLETIN OF THE DEPARTMENT OF LABOR.

To secure a loan the applicant is required to fill out an application
blank, giving his name, address, occupation, and place of birth, the
amount of money desired, and name as references two men whom he
thinks will indorse his note. Upton returning the blank he is given a
card bearing a number by which his application is to be designated and
by which he shall be known. The object of calling an applicant by
number, instead of by his proper name, is to avoid the embarrassment
it is judged one might feel in being called by name when the office is
filled with strangers.
As soon as the application is filed the secretary corresponds with the
men suggested as indorsers to ascertain if they are willing to sign the
applicant’s note. If their answers are satisfactory, and the indorsers
meet the requirements of the society, the number of the applicant’s
application is placed on a blackboard under the head of accepted loans,
and upon his return and presentation of his number the note is made
out, and when indorsed by a financially responsible business man if the
amount is $25 or less, and by two such if a sum above that amount,
the money is advanced. The amount that may be loaned to a single
person is dependent upon the capital stock of the association, the con­
stitution providing that sums of from $5 to $10 only may be advanced
until the stock exceeds $5,000, when the board of directors shall have
power to put aside 5 per cent of the capital for larger loans, but no more
than $25 shall be loaned to one person until the funds of the society
exceed the sum of $ 10,000.
A loan once made is in all cases to be repaid in weekly installments
of 10 per cent of the amount, but no interest or expense is charged, to
either borrower or indorser on any loan granted by the society, except
such legal expense as is incurred in its collection on the failure of the
maker or indorser to pay the same. I f three weekly installments
remain unpaid, a notice is sent to the debtor as well as to the indorser.
If this does not elicit a satisfactory answer, a grace of two weeks is
granted, after the expiration of which legal proceedings are instituted
to collect the note, the only exception to this rule being that a member
of the society in good standing having indorsed a note whose payment
is neglected by the debtor is given a time limit within which to pay the
amount due.
The utmost care is taken in accepting indorsers, who must in all cases
be sanctioned by the u investigator,” and no one having indorsed a note
is permitted to make a second indorsement until the first has been
fully paid. In point of fact, less inquiry is made as to the character and
ability of the borrower than that of the indorser. It is taken for
granted that if the would-be borrower can furnish an acceptable
indorser his loan should be allowed, the object being to save the society
the expense of making a second investigation. It would seem that this
would cause a large number of indorsers to pay the loans, but such a
result has not been experienced. Up to date not over one-half of 1 per
cent of the indorsers have been required to pay, and of these several are



PAWNBROKING IN EUROPE AND THE UNITED STATES.

309

being repaid by the debtors in installments smaller than the rules of
the association will permit it to accept. The fact that the society has
given the borrower better terms than he could get elsewhere seems to
appeal to his better instincts. At the same time his desire to meet his
payments promptly is further heightened by the fact that the rules of
the association will not permit the granting of a second loan to the
same debtor until the number of weeks by which he was delinquent in
the payment of the first have elapsed after his last payment. W hat­
ever may in general be said against this method, from the association’s
standpoint it is entirely satisfactory, its officers pointing with pride to
the fact that in the loaning of $99,885, the society has lost less than
$600, of which sum about $150 has been lost on account of death, $75
on account of failures, and the remainder through the dishonesty of the
applicants or their removal from the city.
In the table following is shown the number of loans, amount loaned,
and average loan made by the Hebrew Free Loan Association, 1892 to
1898:
N U M B E R OF LO A N S, A M O U N T L O A N E D , A N D A V E R A G E L O A N , H E B R E W F R E E L O A N
A SS O C IA T IO N , 1892 TO 1898.
Tear.

N um ber A m ou nt
o f loans. loaned.

A verage
loan.

1892 ........................................................................................................................
1893 ..........................................................................................................................
1894...........................................................................................................................
1895...........................................................................................................................
1896...........................................................................................................................
1897...........................................................................................................................
1898 (hrst six m onths)........................................................................................

227
803
857
774
828
2, 662
1,910

$1,205
4, 779
6, 745
7, 016
8, 047
38,113
33, 980

$5.31
7.93
7.87
9. 06
9. 72
14. 32
17. 79

T o t a l.............................................................................................................

7, 861

99, 885

12. 71

The above table shows the actual work of the association since the
time of its formation. From the income account it was seen that the
amount realized from membership fees had risen from $920.40 in 1892
to $2,244.32 in 1897. The donations in the same period show a greater
increase, while the fact that the association is no longer dependent on
theaters, picnics, and church collections for support indicates that it is
fast assuming the status of an independent business corporation. Dur­
ing the same period the expenditures incurred by the increased busi­
ness of the society had risen from $628.87 to $1,617.78.
Prior to 1897 the society was unable to fully meet the demands of
borrowers, the increase in the number of loans and the amount loaned
being very gradual up to that date. Since then its increased possibili­
ties are shown in the sudden rise in the amount loaned, being from
$8,047 in 1896 to $38,113 the following year. Basing an estimate on
the work of the first six months of 1898, the society will be able to
place during the year at least $65,000 in the hands of its patrons.
In like manner the average loan has risen from $5.31 in 1892 to $17.79
in the first six months of 1898, a result due to a provision of the consti­
tution rather than to the greater need on the part of the borrowers.



310

BULLETIN OF THE DEPARTMENT OF LABOR.

For the 5,951 loans made prior to January 1 , 1898, it was found that
5,475 applications had been refused. Of this latter number, 3,500
failed owing to the inadequacy of the amount which the society would
advance, 1,500 on account of unsatisfactory indorsers, and the remainder
to the would-be borrowers’ inability to procure indorsers.
The nationality of those receiving loans from the association is shown
in the following statement:
Number.

Americans...................................................................................................................................
Austrians......................................................................................................................................
Englishm en................................................................................................................
Frenchmen..................................................................................................................................
Germans.......................................................................................................................................
H ollanders.................................................................................................................................
Hungarians.................................................................................................................................
Italians.........................................................................................................................................
Roumanians...............................................................................................................................
R u ssian s......................................................................................................................................
Swedes..........................................................................................................................................
T u r k s ...........................................................................................................................................

525
1,591
80
174
741
9
1,178
2
1, 023
2, 519
4
15

In the minds of many, the HebrewFree Loan Association is supposed
, to limit its operations to Hebrews only, a conclusion dispelled by refer­
ence to the above statement. It is seen that almost all nationalities
are represented, the American, the Hungarian, the Frenchman, and
the Turk. The statement is based on the place of birth, hence no con­
clusion as to ancestry may be drawn. It may, however, be confidently
asserted that the work of the society, while largely among those of
Hebrew descent, is in no way limited to that class.
According to the provisions of the constitution the society is permit­
ted to make loans upon pledges, and in accordance with this proviso
the board of directors procured a new charter permitting them to con­
duct a regular pawn or mortgage business,* but up to date, however,
nothing has been done in this line, due to the objections of the presi­
dent, which in one of his reports he sums up as follows, giving the last
objection particular emphasis:
First. Our aim is purely a charitable one, and in the sense of the
Jewish ethics we are not allowed to take interest.
Second. Our aim is to help the deserving poor only, and this can not
be observed by lending on pledges, for then we might assist a gambler
or a thief.
Third. If we lend money for only a small interest, in the course of
time our purpose may dissolve and the society become a regular pawn
office.




RECENT REPORTS OF STATE BUREAUS OF LABOR STATISTICS.

MICHIGAN.
Fifteenth Annual Report of the Bureau of Labor and Industrial Statis­
tics. 1898. Joseph L. Cox, Commissioner. 341 pp.
This report deals with a variety of subjects. Of those relating to
labor conditions, the following are the most important: Condition of
employment, 46 pages 5 wages of mechanics and laborers, 9 pages;
women and children, 8 pages; trade unions, 11 pages; railroad em­
ployees, 27 pages; street-railway employees, 4 pages; electric lighting,
gas, and water plants, 16 pages; mines and miners, 39 pages. Other
chapters of the report relate to the origin of the bureau; the number
and salaries of traveling men; the police and fire departments; the lake
traffic of Michigan; the German Workingmen’s Benevolent Associa­
tion; city improvements; village statistics; penal institutions; statistics
of agriculture; the beet-sugar industry; the State Grange; game, birds,
and fish; fur-bearing animals; statistics of the Grand Army of the
Republic; the public schools; the State court of arbitration; labor laws;
and papers on capital and labor, cooperation, and the single tax.
Condition of Employment.—A canvass of the State disclosed a
gradual improvement in general business, many increasing avenues of
employment, increased wages in some localities, and higher prices of
farm products during the year 1897.
W ages of Mechanics and Laborers.—Schedules of inquiry
relating to wages and other social conditions were sent to working
people throughout the State. Returns were received in 11,065 cases.
The following table shows, for selected occupations, the average daily
wages for 1897, the average number of months employed during that
year, and the average number of years the working people were engaged
in their present trades:
D A I L Y W A G E S OF W O R K IN G P E O PLE A N D T IM E E M P L O Y E D D U R IN G 1897, B Y
S E LE C TED OC C U PA TIO N S.

Occupations.

B a k ers......................
B a rb ers ....................
B icycle m akers........
B la ck sm ith s...........
B oiler m ak ers.........
B o o k b in d ers...........
B rew ers....................
Cabinetm akers........
C arpenters...............
Carriage workers - ..
Cigar m akers...........
C o o p e rs ....................

A ver­ A ver­
age
age
A v e r ­ months years
N um ­ age
em
­
at
daily
ber.
ployed* pres­
wages. during ent
year. trade.
91

121

61
162
69
76
7
740
443
87
515
56




$2.04
1.57
1.65

1.88

2.13
1. 65
1.97
1.40
1.72
1.71

1.66
1.86

11
11
9

10
9

11
12
9
9

8

9

8

16

12
6
19

11
12
11
10
16
14
16

22

Occupations.

A v e r ­ A v e r­
age
age
A v e r­
months
years
N um ­ age
em­
at
ber.
daily
ployed pres­
wages. during
ent
year. trade.

Engineers
(sta­
tionary) ...............
160
Firemen (not lo co ­
m otive) ...............
89
Glass workers (not
including glass
56
b lo w e r s ).............
Harness m akers. . .
10
L a b orers................. 1, 794
70
Linotype operators
424
M ach in ists.............
66
M a s o n s ...................

$1.97

11

14

1.53

10

9

9

7
19
14
4
13
15

1.42
1.50
1.25
3. 70

2.02
2. 71

11
8
11
10
6

311

312

BULLETIN OF THE DEPARTMENT OF LABOR.

D A I L Y W A G E S OF W O R K IN G PE O PLE A N D T IM E E M P L O Y E D D U R IN G 1897, B Y
S E L E C T E D O C C U PA TIO N S —Concluded.
A ver- A v e r ­
age
age 1
A v e r ­ months
years
N um ­ t s ?
em- i at
ber.
daily ployed |
wages. d u rin g ) pres­
ent
year. ! trade.

Occupations.

M etal workers
M illers......................
M illw righ ts.............
M old ers...................
P a in te r s ____ _____
Pattern m a k ers----P lu m b ers.................
P rinters and com ­
positors (hand). . .

74
19

$1.93
1.69
2.25

1,035
175
85
53

2.10
1 . 62
2.22

20

289

A v e r­ A v e r­
age
age
A v e r­
months
years
N um ­ age
em ­
at
ber.
daliy ployed
wages. during pres­
ent
year. trade.

Occupations.

8

9

10 ,
8;
9 j

1.98

10 I
10 I

2.28 1

10 !

!

Shoem akers...........
S ton ecu tters.........
Stove m a k e r s ........
12 T a ilors.....................
12 1 T ea m sters.............
14 : T in n e r s ...................
8 W ood turners and
carvers ...............
16
W ool-boot m akers.

■ 11
19

207
29
152
42
214
56

$1.81
2.80

173
51

1.90
1.37

2.12
1.85
1. 63
1.79

7

13
16

8
8

12

9

19

11
10

14

8

11

9

10

5

The returns for all of the 11,065 cases showed an average daily wage of
$1.62 and an average employment of 9 months during the year 1897.
The average time that the working people were engaged in their pres­
ent trades was 11\ years. Of 11,060 persons reporting, 7,275 were
married, 3,635 were single, and 150 were widowed. There were 2.6 chil­
dren per family and 3.2 dependents per workingman. Of 7,646 persons
reporting, 3,346 owned their homes and 4,300 were paying rent.
W omen and Children .—In this investigation returns for 1,683
females over 16 years of age .were received. Of this number 986, or 59
per cent, had others depending upon their labor for support. Ten hours
usually constituted a day’s work, although 378 worked over 10 hours per
day. The average wages received by the 1,683 females were $4.41 per
week. The average wages received by 352 children were $2.04 per week.
Trade Unions.—A brief statement is given of each trade union in
the State from which returns were obtained. The statement shows the
name of the organization, locality, membership, wage scales, and other
information. Following is a list of the trade unions returned and the
membership of each :
N U M B E R A N D M E M B E R S H IP OF T R A D E UNIONS, 1897.
Local
unions or
branches.

Organizations.
Am algam ated W ood W orkers..
B akers’ U n ion ............................. .
B arbers’ U nion.............................
B oiler M akers and Iron Ship­
builders .......................................
B rew ers’ U n io n ............................
Broom M akers’ U n ion .................
B ricklayers’ U nion......................
Brotherhood o f Boiler Makers
and Iron Shipbuilders.............
Brotherhood o f Painters and
D e cora tors.................................
Brothers o f H olding On and
H eating U n ion ..........................
Carpenters’ U n io n ......................
Cigar M akers’ U nion..................
Clerks’ U n io n ...............................
C oopers’ U nion.............................
Dray, Express, a nd H ackU nion.
E lectrical W ork ers’ U nion........
Federal Labor U nion..................
International A ssociation o f
M a ch in ists..................................
a-Not reported.




b

1
1
4
3

1
1
1
1
1
1
2
21
4

1
1
1
2
2

M em­
bers.

Organizations.

50
40
95

Iron M olders’ U n io n .................
Journeym en Barbers’ U nion ..
Journeym en T ailors’ U n io n ...
Longshorem en’s U nion.............
115 Lum ber and Miscellaneous
47
Freight H andlers’ U n io n ...'.
M achinists’ U n io n ....................
(«)
75 M etal
Polishers,
Buffers,
Platers, and Brass W ork­
10
ers’ U n io n ................................
M etal
Polishers,
Buffers,
22 j
and Platers’ U nion.................
M iners’ Protective A ssocia­
20
tion ............................................
543
Northern M ineral M ine W o rk ­
6 1,129
ers’ Progressive U nion .........
c 375
Tailors’ U n io n ............................
50 Theatrical P rotective U n ion ..
10 Tobacco W orkers’ U n ion .........
58 Typographical U n io n ...............
204 U nited Brotherhood o f Car­
penters and J oin ers...............
225
W ood Carvers’ U n io n ...............

T w o local branches not reporting.

c

Local
unions o r ! M em ­
branches.! bers.

8
1

1,422

20
88

4

21

c 1, 373

1
7

35
513

4

280

2

S23

1

32

1
2
1
1
10

2,000
17
28
294
719
1

i!

2

17
c 17

One local branch not reporting.

REPORTS OF STATE BUREAUS OF LABOR---- MICHIGAN.

313

Railroad Employees.—This chapter contains the results of a
canvass of 833 persons employed by 19 railroad companies in the State.
The information relates to wage rates, hours of labor, yearly earnings,
and other social conditions. O f the 833 canvassed, 640 were married,
183 were single, and 10 were widowed. The average family consisted
of 2.1 adults and 2.3 children. Of 815 reporting, 282 owned their
homes, 199 of the latter being free from indebtedness. About 55 per
cent of those having families rented their homes, paying an average
rental of $8.07 per month. Of 822 reporting, 491 carried life insurance;
accident insurance was carried by 257 out of 818 reporting, and sick
benefit insurance by 124 out of 810 reporting.
Street Railway Employees.—This chapter shows, in tabular
form, the wages and hours of labor of 2,650 employees of 17 street rail­
ways in different parts of the State. The average of the returns for
the 17 street railways shows the following wage rates and hours of
labor: Conductors, 18.9 cents per hour, 9.7 hours per day; motormen,
18.7 cents per hour, 10.8 hours per day; shopmen, 19.7 cents per hour,
10.2 hours per day; trackmen, 14.1 cents per hour, 10 hours per day.
Electric Lighting, Ga s , and W ater Plants.—This investiga­
tion was undertaken in consequence of a recommendation made by the
National Association of Officials of Bureaus of Labor Statistics in
the United States. Tables are presented showing for each electric
lighting, gas, and water plant in the State, from which the information
could be obtained, the character of the ownership, whether municipal,
corporate, or private; the cost and capacity of the plant, the assessed
valuation, selling price and quantity of product, salaries and wages
paid, and other data, for 1897. Information was received from 141
electric-lighting plants, 126 water plants (3 plants not making complete
returns), and 25 gas plants.
Of the 141 electric-lighting plants, 100 were owned by companies and
individuals, 40 by municipalities, and the ownershq) of 1 was not
reported. They represented, in the aggregate, an invested capital of
$6,256,075. The salaries and wages paid during the year amounted to
$299,388. The plants had a total capacity of 17,992 arc and 276,590
incandescent lights. The average cost per month for arc lights was
$6 in cities and $6.55 in villages, and for incandescent lights 64 cents
in cities and 61.5 cents in villages.
Of the 129 water plants, 107 were owned by municipalities and 22
by companies and individuals. A total of $16,091,167 was invested in
the 126 plants reporting. The plants had a total capacity of 427,109,000
gallons per day. The average cost of the water was, for residences,
$4.72per year in cities and $3.98 in villages; for lawn sprinkling, $3.64
in cities and $2.91 in villages.
Twenty-five gas plants were returned, of which but one was owned
by a municipality. They represented a total investment of $7,564,346.
The aggregate salaries and wages paid during the year amounted to
9986—No. 21------10



314

BULLETIN OF THE DEPARTMENT OF LABOR.

$234,700. The average capacity of the plants was about 200,000 cul?ie
feet per 24 hours. The average price paid for gas per 1,000 cubic feet
was $1.44 for lighting and $1.15 for fuel.
Mines and Miners.—This chapter consists of a report on the num­
ber of mines and mine workers, occupations, wages, output, and other
data regarding the iron, copper, and gold and silver mines in the State.
Thirty-three iron mines produced, in 1897, 5,933,005 tons of ore, and
gave employment to 8,931 persons, paying an average wage of $1.65
per day. Seventeen copper mines employed 8,850 persons and pro­
duced 141,666,156 pounds of copper during the year. The average
wage rate was $1.85 per day. One gold and silver mine employed 53
persons at an average wage of $1.67 per day.




SECOND ANN UAL REPORT ON TH E BUILDING AND LOAN ASSOCIA­
TIONS OF CONNECTICUT.

Report o f the Commissioner of Building and Loan Associations. Decem­
ber 31, 1898. Edwin L. Scofield, Commissioner. 165 pp.
The returns of the building and loan associations doing business
in Connecticut September 30, 1898, show an increase in business dur­
ing the year. The total assets of the domestic associations on Septem­
ber 30, 1898, were $3,627,828.12, an increase of $383,892.93 over the
preceding year. The total assets of the foreign associations were
$4,313,015.36, an increase of $472,020.72.
The following tables show the assets and liabilities and miscellaneous
statistics of the 15 domestic and 5 foreign associations in the State :
A SS E T S A N D L I A B I L I T I E S OF 15 D O M E STIC A S S O C IA T IO N S S E P T E M B E R 30, 1898.

Items.

A ssets.

Item s.

Due shareholders, installments
Loans on real e s ta te .......................... $3, 056, 398.01
104, 713.80
p a id ..................................................
Loans on s h a re s .......................... .. -.
193, 778.16
Due shareholders, single payment
Real e s ta t e ...........................................
120,727.34
Cash.......................................................
sh a res..............................................
F urniture and fix t u r e s ....................
7, 468.91
Due shareholders, earnings cred ­
11,480. 95
ited ....................................................
Installments due and u n p a id .........
Interest, premium, fees, and fines
1 Due .shareholders, earnings not
11,840.49
credited and surplus.....................
due and u n p a id ...............................
99, 777. 00 Balance to be paid out on loans
Stocks, bonds, and other securities.
m a d e ................................................
6,022. 46
T axes and insurance a d va n ced ----Borrowed m o n e y ..............................
Interest paid in advance on m ort­
Premium accou nt..............................
gages conditionally assumed for
4, 643. 71 Insurance profits, balance in e x ­
m e m b ers ...........................................
10,977.29
pense fund and balance in insur­
Other a ssets.........................................
ance fu n d .........................................
Guarantee fund and su rp lu s. . . . . .
M ortgages and interest condi­
tionally assumed for m em bers..
Other liabilities.................................
Total

3,627, 828.12

T o t a l..........................................

Liabilities.

$2, 062,928.28
618. 072.89
204,337.05
92, 420. 39
20,555. 50
4, 584. 00
10, 088. 84
21,419. 04
103,132. 86
483, 053. 80
7, 235.47
3, 627,828.12

A SS E T S A N D L I A B I L I T I E S OF 5 F O R E IG N A SS O C IA T IO N S S E P T E M B E R 30, 1898.

Loans on real e s ta te .......................... $3,009, 616.50
139, 223.15
Loans on s h a re s .................................
Real e s ta t e ........................................
684, 068.17
C ash........................................................
60,420. 63
Furniture and fixtu res......................
6, 415. 44
Installments due and unpaid...........
177, 264. 55
Interest, premium, fees, and fines
53, 312. 92
due and un p aid ...............................
74,794.48
Stocks, bonds, and other securities.
16,593. 75
Taxes and insurance a d v a n ce d ----51, 947.19
Bills receiva ble...................................
39, 358. 58
Other a ssets........................................

Total




4, 313, 015. 36

Due shareholders, installments
p a id ..................................................
Due shareholders, single paym ent
s h a res..............................................
Due shareholders, earnings cred­
ited ....................................................
Due shareholders, earnings not
credited and surplus....................
Balance to be paid out on loans
m a d e ................................................
Borrowed m o n e y ..............................
M ortgages assumed for members Unearned prem ium ..........................
Installments due and u n p a id ........
Due on real estate purchased........
Other liabilities.................................
Total

$2, 272, 515. 77
927,191. 64
187, 376. 22
201, 425. 26
37, 705. 25
31, 500. 00
1, 017. 05
374, 687. 78
148, 357. 75
130, 562. 71
675. 93
4, 313, 015. 36

315

316

BULLETIN OF THE DEPARTMENT OF LABOR.

M IS C E L L A N E O U S S T A T IS T IC S F O E T H E Y E A R E N D IN G SE P T E M B E E 30,1898.

Item s.

Shares issned during y e a r ........................................................... ................................... .....
Shares withdrawn, lapsed, and c a n c e le d ............................................................................
Shares in force at end o f yea r....................................................................................... .
Shares borrow ed u p on ............................................................................................................
B orrow ing members . . ................................................. . _......................................................
N onborrow ing m em b ers.............................. . . .......... .............................................. ..
Shares held b y nonborrow ing m embers. . . . . . . . . . . . . . . . ..............................................

15 dom es­ 5 foreign
tic asso­ associa­
ciations.
tions.
29, 726|
21,385
82,456
20, 645
2, 271
11,372
60,804

36,449
60,146^
159, 793|
38, 068
2, 926
13,218
121,925.1

The report contains also a brief statement of the condition of mort­
gage investment companies and a reproduction of the laws of the State
relating to building and loan associations.




EIGHTH ANNUAL REPORT ON THE BUILDING AND LOAN ASSOCIA­
TIONS OP N E W YORK.

Annual Report o f the Superintendent of Banks Relative to Building and
Loan and Cooperative Savings and Loan Associations, fo r the year 1897.
Transmitted to the Legislature March 1,1898. F. D. Kilburn, Super­
intendent of Banks. 663 pp.
This report consists of the following: List of cooperative savings and
loan associations that were reported to the banking department, or
were organized or authorized under the banking law, from 1875 to 1898,
including building lot associations; detailed statement of the condition
of the cooperative savings and loan associations of ISTew York, January
1, 1898, compiled from reports made to the banking department and
arranged alphabetically by counties; comparative table of assets, lia­
bilities, receipts, disbursements, etc., of cooperative savings and loan
associations for the year 1897; detailed statement of the condition of
lot associations; and a reproduction of the laws governing the organi­
zation and supervision of building and loan and cooperative savings
and loan associations.
The following tables show the total assets and liabilities, receipts and
disbursements, and miscellaneous statistics of 361 national and local
associations in the State:
A SSE T S A N D L I A B I L I T I E S OF 361 A S S O C IA T IO N S F O R T H E T E A R 1897.

Item s.

National.

Local.

Total.

ASSETS.

$16, 365, 628 $31, 654, 012
594, 388
947, 616
58, 009
118, 367
12, 000
1,200
5,147,172
2,477,735
734, 720
1, 656, 654
52, 247
43,113
270,550
91, 997
150, 411
281, 957
622, 029
304,547
19
148

$48, 019, 640
1,542, 004
176, 376
13, 200
7, 624, 907
2, 391, 574
95, 360
362, 547
432, 368
926, 576
167

24,199, 077 ! 37, 385, 642

61, 584, 719

Due shareholders, dues and p rofits...........
Due shareholders, matured s h a re s ...........
Balance to be paid out on m ortgage loans
Borrowed m o n e y ............................................
Earnings un divided.......................................
Other liabilities..............................................
A d d for c e n ts ..................................................

16,897, 590
20, 341
742, 097
179, 771
1 , 660, 660
4. 698,599
19

33,796,381
496, 803
361,138
357, 087
1, 955,154
418, 931
148

50, 693, 971
517,144
1,103, 235
536, 858
3, 615, 814
5,117, 530
167

T otal.......................................................

24,199, 077

37,385,642

61,584,719

Loans on bond and m ortgage.......................................
Loans on shares...............................................................
Tem porary loa n s.............................................................
Stocks ana b o n d # ...........................................................
Real estate........................................................................
Cash on hand and in b an k ............................................
Furniture and fixtu res..................................................
Installments due and u n paid.......................................
Interest, premium, fees, and fines due and unpaid
Other assets......................................................................
A d d for c e n t s ..................................................................
Total
LIABILITIES.




Q1»7

318

BULLETIN OP THE DEPARTMENT OF LABOR.

R E C E IP T S A N D D IS B U R S E M E N T S OE 361 A S S O C IA T IO N S FO R T H E T E A R 1897.

Items.

Cash on hand January 1 , 1897.,
Subscriptions on shares...........
M oney borrow ed ........................
M ortgages red eem ed.................
Other loans redeem ed...............
R eal estate sold..........................
Rees re c e iv e d ..............................
Premium received......................
Interest received . : .....................
F ines r e c e iv e d ............................
R ent receiv ed ..............................
Other receipts..............................
A d d for c e n t s ..............................
T otal.

National.

Local.

Total.

$1,155, 708
8, 022, 967
1,085, 056
5,156, 352
891, 570
177,868
31,159
406, 882
1, 653, 719
42,902
103, 332
306, 711
158

$1, 833, 695
13, 375, 998
1, 327, 999
8, 671, 771
1 , 281,408
1,116, 080
171,195
1, 098,304
2,497, 286
89, 831
210, 420
2, 324, 720
181

j 14, 964, 504 | 19, 034, 384

33,998, 888

i 5, 043,498
629,136
3,853, 221
135,056
279,190
242, 649
1 , 868, 913
595,147
66, 774
55, 040
143,990
91,221
1,225,926
734, 720
23

5, 820, 264
804, 909
7, 739,464
767, 669
1,150, 355
56, 046
303,936
196,024
23, 557
34, 522
54, 861
77, 588
348,177
1, 656, 854
158

10, 863, 762
1, 434, 045
11,592, 685
902, 725
1, 429. 545
298, 695
2,172, 849
791,171
90,331
89, 562
198,851
168, 809
1, 574,103
2, 391, 574
181

14,964,504

19, 034. 384

33, 998, 888

$677, 987
5, 353, 031
242, 943
3, 515,419
389, 838
938, 212
140, 036
691, 422
843, 567
46, 929
107, 088
2, 018,009
23

DISBURSEMENTS.

L oaned on m o r tg a g e .........................................
Loaned on other s ecu rities..............................
P aid on withdrawals, dues, and p rofits........
P aid matured s h a re s .........................................
P aid borrow ed m oney.......................................
P aid interest........................................................
P a id fo r real e s ta t e ...........................................
P aid salaries, clerk hire, and com m issions.
P aid advertising, printing, and postage----Paid r e n t .............................................................
P aid repairs to real estate................................
P aid taxes, insurance, e t c ................................
Other disbursem ents.........................................
Cash on hand December 31, 1897.....................
A d d for c e n t s ......................................................
T otal.

M IS C E L L A N E O U S S T A T IS T IC S OF 361 A S S O C IA T IO N S F O R T H E T E A R 1897.

Item s.
A s s o cia tio n s ...............................................................
Shares in force January 1, 1897..............................
Shares issued during the yea r...............................
Shares w ithdrawn during the yea r......................
Shares in force Decem ber 31, 1897 ........................
B orrow ing m em bers..................................................
Shares held b y borrow ing m em b ers....................
N onborrow ing m em bers..........................................
Shares held b y nonborrow ing m em b ers .............
Fem ale sh a reh old ers................................................
Shares held b y fem ales............................................
Foreclosures in 1897.................................................
A m ount o f m ortgages on property in the State.
E xpenses for the yea r..............................................




National.

Local.

44
317
825,203
741,708
375, 939
189, 029
318, 349
197,867
882,793
732,870
13,453
20, 356
193, 852
205, 259
82, 546
68,569
688, 941
527,611
a 10,460
a 30,153
a 107,176
a 207, 786
431
293
$9, 608,263 $29, 075,315
$789, 553
$303,572

a N ot including 22 associations not reporting.

Total.
361
1, 566, 911
564, 968
516, 216
1, 615, 663
33,809
399, 111
151,115
1, 216, 552
a 40, 613
a 314, 962
724
$38, 683,578
$1, 093,125

FIRST ANNUAL REPORT ON THE BUILDING AND LOAN ASSOCIA­
TIONS OF WISCONSIN.

First Annual Report o f the Bank Examiner on the Condition o f the Build­
ing and Loan Associations o f Wisconsin. August 25, 1898. E. I.
Kidd, Bank Examiner, xii, 109 pp.
There were 53 building and loan associations (all domestic) reported
as doing business in the State. Each association reported the con­
dition and results of operations at the close of its own fiscal year, and
as these dates occurred in every month of the year a summary of
operations for any one date could not be presented.
The following statements show the total assets, liabilities, and other
data as reported by the building and loan associations for dates ranging
from the year ending March 1,1897, to the year ending March 31,1898:
A SS E T S' A N D L I A B I L I T I E S OF 53 A SS O C IA T IO N S .

A ssets.

Liabilities.

Loans on m ortgage secu rity........... $3, 044, 374. 22
Loans on pass-book security w ith ­
100, 729. 61
out m ortg a g e .................... ’.............
16, 413. 22
Loans on other s e c u r it y ................. .
187, 369. 07
Real e s ta t e .........................................
Furniture and fix tu r e s ....................
3, 537. $8
Stationery and s u p p lie s ................. .
1, 088.84
Bills receiv a ble................................. .
1, 429.14
Due for stock assessm en ts.............
17, 442. 83
D u e for insurance and taxes paid
12,420. 36
for borrow ers................................. .
16, 324. 35
Interest d u e.........................................
4, 603. 52
Prem ium s and fees d u e ....................
4, 334. 51
R eal estate sold on co n tr a c t...........
2,131. 73
Fines d u e . . . : ..................................... .
50, 068. 21
Other a ssets....................................... .
106,172. 56
Cash on hand and in b an k ............. .
3, 568, 440. 05

Total

Capital paid in on installment
s t o c k ................................................
Capital paid in on full-paid stock.
Fund for contingent lo s s e s ...........
D eposits..............................................
Borrowed m o n e y ..............................
Mortgages on real estate.................
Dividends on installment and fullpaid s t o c k .......................................
A d vance paym ents..........................
Other lia b ilitie s ................................
Surplus and undivided p ro fits -----

Total

$2, 636, 478. 88
238, 398. 89
17,079.28
75, 325. 84
69,139. 57
8,150. 00
167, 659. 67
19,244. 77
19, 742. 62
317, 220. 53

3,568,440.05

S T A T IS T IC S OF S H A R E S OF 53 A SSO C IA T IO N S.

Item s.

In sta ll­ Full-paid
and
m ent
prepaid
stock.
stock.

N um ber o f shares issued during term ...............................................................................
N um ber o f shares canceled and w ith d ra w n ....................................................................
Present total num ber o f shares in f o r c e .........................................................................

102, 022|

P r e s e n t n u m b e r o f s h a r e s on w h ie h l o a n s h a v e b e e n m a d e ..................................................

30,925^




1 , 060J
1, 059i
3,116

22,771^
19,128J

319

RECENT FOREIGN STATISTICAL PUBLICATIONS.

FRANCE.
Salaires et Duree du Travail dans Vlndustrie Frangaise. Tome IV,
Resultats Generaux. Office du Travail. Ministere du Commerce,
de l’lndustrie, des Postes et des Telegraphes. 1897. 572 pp.
The present volume completes the publication of the results of an
inquiry relating to wages and hours of labor carried on by the French
labor bureau from 1891 to 1893. The three preceding volumes contain
the detailed figures for each establishment and occupation considered,
while the present volume shows the general results. This volume also
contains the results of supplementary investigations relating to wages
in certain occupations in 1896, prices of commodities, cost of board
and lodging, workingmen’s budgets, and average wages at three
periods from 1840 to 1893. The principal inquiry covers 2,957 private
establishments, besides the transportation enterprises and the State
and communal service, employing altogether 674,000 persons. Only
the larger and medium-sized establishments are considered in this
inquiry. Those making returns employed about one-third of the whole
number of employees occupied in such industries.
In analyzing the material presented in this work that relating to
private industries was first considered. The general results of the
investigation, so far as they relate to private industries, were summa­
rized and analyzed under the following heads: Establishments consid­
ered, duration of labor, stability of employment, wages, wages and
hours of labor as affected by the importance of the establishment, vari­
ation of wages according to locality, cost of living, variation in wages
during fifty years.
E stablishments Considered.—The private industries embraced
2,957 establishments, employing 471,690 persons. Of the personnel, 3
per cent were foremen, 71 per cent were male adults, 18 per cent were
female adults, and 8 per cent were children and apprentices of both
sexes. The proportion of skilled workers was smallest in industries
engaged in preparing material, such as the food and chemical indus­
tries, and greatest in those industries where products were shaped and
finished. To some extent the proportion of skilled labor also increased
with the hardness of the material worked upon.
The average number of days in which the establishments were in
actual operation corresponded very nearly with the number of avail­
able working days during the year. Almost all establishments were
closed on Sundays and holidays, the exceptions being mainly those
where continuous fires had to be maintained. The individual employees
320




321

FOREIGN STATISTICAL PUBLICATIONS-----FRANCE.

did not, however, work uninterruptedly. About 5 per cent of their
time was lost by absence on account of sickness and other causes. Each
employee worked an average of 290 days per year.
The following tables give a summary of the general results of the
inquiry as far as they relate to private establishments, the department
of the Seine (Paris and suburbs) and the other departments of France
being considered separately:
A V E E A G E W O R K IN G D A Y S , HOURS OF L A B O R , A N D D A I L Y W A G E S OF E M P L O Y E E S
I N P R I V A T E E ST A B L IS H M E N T S , B Y IN D U S T R IE S .
D E P A R T M E N T OF T H E

S E IN E .

Em ployees.
A v e r­
Estab­
age per
lish ­ Total.
estab­
ments.
(a)
lish ­
ment.
(&)

Industries.

F ood p ro d u cts ..........................................
Chemical p rod ucts___________ _______
Paper and caoutchouc good s.................
P rin tin g and p u b lish in g........................
H ides and leather.....................................
T e x t ile s ......................................................
Clothing, e t c .............................................
H eavy w ood w ork .....................................
Cabinetm aking and jo in in g ..................
Iro n rolling, forging, e t c ......................
F oun dry and machine sh op ..................
M etallic g o o d s ...........................................
Precious m etals.........................................
Stone cu tting and p o lis h in g .................
P ip e laying, stone-construction work,
water and power plan ts......................
Glass, tile, brick, pottery, lime, e t c ...
Transportation and h a n d lin g ...............
T o t a l................................................

6,500
2, 550
3,240
4, 900
4,000
2,880
4, 760
1,450
3, 050
4, 700
8,150
4,260
1, 560
130

160
90
150
180

18
7

2,850
3,160
1,150

125
170
165

451

59, 290

125

36
28

21
27
33

21
28

22
39
34
49
44

20
3

21

OTHER DEPARTM ENTS

110

135
155
60
75

100
165
95
75
45

Per
cent o f
women
and
children
o f total
em­
ployees.

A v e r­
age A v e r ­
A v e r­
age
workage
days in
ing
hours
opera­ days o f
of
tion per each labor.
year.
em ­
ployee.

28

319
328
319
304
310
302
302
318
305
303
305
301
300
296

300
321
295
298
292
292
280
298
295
290
277
286
289
293
253
297

22

324
305
331

26

310

20
33
38
40
54
55
4
16
5
5
24
38
15

1
31

lOf
10*

10
10*
10£
10*
10
10

m
lOf
10*
10
10
Of

$0.96
.91

.86
.98
.92
.73
.83
1.24
1 . 20
1.16
1. 23
1.07
1.05

1.66

1.22

m
9*

.82
1.03

290

10|

1.02

c289
id)
286
273
327
317
307
291
290
284
278
289
295
277
301
298
282

c9*
(d)
10*
10|
10*

c. 77
(d)
.64

OF F R A N C E .

C oalm ines..................................................
Other m in e s ..............................................
Quarries......................................................
F ood p rod u cts...........................................
Chemical p rod ucts...................................
P aper ana caoutchouc g ood s.................
P rin tin g and publish in g........................
H ides and leath er.....................................
T e x t ile s ......................................................
Clothing, e t c .............................................
H ea vy w ood w ork.....................................
Cabinetmaking, join in g, e t c .................
M etal smelting, steel, brass, e t c ...........
Iron rolling, forging, e t c ........................
Foundry and m achine s h o p ..................
M etallic good s..........................................
Precious m e ta ls .......................................
Precious-stone cu ttin g ............................
Stone cu ttin g ............................................
E lectric lighting and pow er plants . . .
P ipe laying and stone-construction
w o r k .........................................................
Glass, tile, brick, pottery, lime, etc . . .

61 80, 650
50 11 , 800
5, 750
55
292 18, 400
163 14,100
87 14, 400
5,610
73
175 15,750
486 100, 350
9, 850
94
7, 900
171
6, 600
90
49 25, 450
115 18. 000
161 32, 300
56
7, 200
600
7
180
4
980
16
170
9

1,320
235
105
60
85
160
75
75
185
80
40
65
520
145

T o t a l................................................

125
80
45
55

30
42

20

1

?301
d)
296
268
340
327
296
303
297
299
308
297
320
296
305
307
291
250
800
859

10

.69
.56
.63
.64
.53
.52
.69
.56
.77
.73
.79
.69
.58
.74
.56
.85

3,930
82,430

55
145

5
27

303
303

255
286

10!
10*

.71
.65

2, 506 412,400

160

26

303

290

10!

.68

70

222

200

c 15
(d)
7

22
11
43
38
26
56
58

10

36
7

20
10
20
24

a Includes both permanent and temporary employees.
b In determ ining these averages temporary employees were not considered.
given in even tens, the averages were calculated to the nearest fives.
e Includes other mines.
d Included in coal mines.




11

A v e r­
age
daily
wages
per em­
ployee.

306
318

11
10*
10|
li!
10!
10|
li
10!
li
10!
10!
10!
H!
10!

.66

A s the totals were

322

BULLETIN OF THE DEPARTMENT OF LABOR.

H ours of Labor.—With regard to hours of labor, two units were
considered, namely, the normal working day, that is, the duration of
the usual working day after deducting intermission for rest or meals,
and the actual working day, or the time during which working people
were actually present at their labor.
The normal working day was from 10 to 1 L hours in the department
of the Seine. In the other departments, employees in one-fourth of the
establishments considered habitually worked 12 hours; in 3 per cent
they worked more than 12 hours per day, and in 6 per cent they worked
9 hours per day or less, the latter establishments including chiefly those
engaged in the mining, metal, and glass industries. The working day
was always interrupted by a rest of at least an hour, and in the case of
two-fifths of the establishments a rest of over one hour was reported.
The actual time of work per day varied to some extent with the time
of the year. The average actual working day was estimated at 10£
hours, two-thirds of all the working days being between 10 and 11
hours in length. The actual working day was shortest in the
coal mines and longest in the textile industry. In over half of the
establishments there was no overtime work. In one-fifth of the others
higher pay was given for overtime.
Stability of Employment.—The results of the inquiry regarding
stability of employment in the 2,957 private establishments considered
are presented in three ways. First is shown the average monthly varia­
tion per year in the number of employees in each industry or group of
industries. In the department of the Seine this ranged from 3 per cent
of the average yearly employees in the group of glass, tile, brick, pot­
tery, lime, etc., industries to 36 per cent in the pipe-laying, stone-con­
struction work, and water and power plants group. In the other
departments of France it ranged from 1 per cent in the textile indus­
tries to 75 per cent in the precious-stone cutting industry. The average
monthly variation for all private industries in France was 4 per cent of
the average yearly employees.
The second showing gives the average yearly variation per establish­
ment in the number of employees in each industry or group of indus­
tries. This ranged in the department of the Seine from 13 per cent in
the textiles, the precious metals, and the glass, tile, brick, pottery,
lime, etc., group to 97 per cent in the pipe-laying, stone-construction
work, and water and power plants group. In the other departments of
France the variation ranged from 7 per cent in the paper and caoutchouc
industries to 90 per cent in the precious-stone cutting industry. The
average variation for all private establishments in France was 19 per
cent.
The third presentation shows a comparison between the total num­
ber of individual employees per establishment during one year and the
average yearly employees in each establishment. The total individual
employees per establishment exceeded the average number from 35 to



FOREIGN STATISTICAL PUBLICATIONS---- FRANCE.

323

40 per cent. It was estimated from the returns received by the bureau
that there were on an average 115 workmen for every 100 positions, of
which 75 workmen were regularly and the rest irregularly employed,
the regular employees working an average of 295 days per year and
the irregular employees 170 days per year.
W ages.—The average wages of all employees of private establish­
ments considered in the inquiry were 3.75 francs ($0.72) per working
day, or 0.355 franc ($0.07) per hour, or a total of 1,080 francs ($208.44)
per year. The average wages of male adults were 4.20 francs ($0.81)
and of female adults 2.£0 francs ($0.42) per day. A considerable dif­
ference existed between the wages in the department of the Seine and
in the other departments of France. In the department of the Seine
the average daily wages of men were 6.15 francs ($1.19) and of women
3 francs ($0.58), while in the other departments the average wages of
men were 3.90 francs ($0.75) and of women 2.10 francs ($0.41) per day.
The wages paid depended largely upon the nature of the industry.
The highest wage rates were observed in industries where products
were shaped and finished, as such work usually required a high degree
of skill on the part of the worker. On the other hand, the lowest
average wages were usually found in industries where the products
were simply prepared or extracted. The only exception to the latter
case was in underground work in the mining industry, where, on
account of the dangerous and repugnant character of the work, higher
wages were paid than the average for all industries considered.
In the same industry and locality, and where the same process of man­
ufacture was employed, the wages in different establishments were
found to be very nearly alike.
In the case of individuals in any given industry, the wages paid
depended largely upon the amount of intelligence and the constancy of
effort required, rather than upon the result of a long term of appren­
ticeship. While a long apprenticeship had a tendency to reduce the
number of journeymen and thus to insure employment to those who
had served their term, it did not affect wages to the extent that might
be imagined.
In large factories the great productive power of the machinery had a
favorable effect upon the wages of the operatives.
The wages of w'omen were, as a rule, about one-half those paid to
men, their work being necessarily of a somewhat different nature. But
even where the work was the same, women in nearly all cases received
less pay than men.
As to the character of wage payments, it was found that, of the total
employees in private establishments, 9 per cent were paid by the
month, 57 per cent by the day, and the rest by the piece. The propor­
tion of pieceworkers was greater among women than among men,
because the former were usually employed at regular oft-repeated oper­
ations that readily admit of payment by the piece.



324

BULLETIN OF THE DEPARTMENT OF LABOR.

It would appear that piecework, by increasing the productivity,
would result in higher wages. This was not found to be always true.
Other conditions being similar, there was generally no difference
between the earnings of time and piece workers.
There were other elements, besides actual wages, which figured in
the earnings of working people in France, namely, fines, subsidies in
kind, prizes, gratuities, insurance, etc.
The fine system existed in 6 per cent of the establishments consid­
ered in the department of the Seine, affecting 13 per cent of all regular
working people employed. In the other departments the fine system
was employed in 22 per cent of the establishments, and affected 47 per
cent of the regular employees considered.
Subsidies in kind were usually given where establishments produced
objects of domestic consumption, such as coal, wood, liquor, etc. Sev­
enteen per cent of the establishments outside of the department of the
Seine furnished supplies of this kind without charge to their employees.
The proportion of such establishments is very small in the department
of the Seine, being scarcely 1 per cent. In many large establishments
in France objects of domestic consumption produced were furnished to
employees at cost price.
Gratuities, especially such as were paid through the profit-sharing
system, were rare, particularly in the departments outside the Seine.
Of the 2,957 private establishments returned throughout France,
excepting of course cooperative associations, only 16 were found where
employees actually shared in the profits and where the balance sheets
were published or the books were open for inspection. There were 110
other establishments in which gratuities of various kinds were regu­
larly distributed among employees.
An accident insurance system generally existed wherever the work
of the employees involved any risk. Over one-half of the employees
considered in this investigation were affiliated with or had the privilege
of joining special aid societies at the establishments where they were
employed. Many other employees, especially those in cities, belonged
to mutual aid societies.
Old-age pension funds were organized by from 2 to 3 per cent of the
establishments considered, and it was estimated that not more than 10
per cent of the employees in large and medium-sized establishments
could avail themselves of such funds instituted by employees.
W ages and Hours of Labor as A ffected by the I mpor­
tance of the E stablishment.—An effort was made in this work to
ascertain the influence which the concentration of enterprises exerted
upon wages and hours of labor by eliminating the influence of locality
and industry and grouping those which were comparable with one
another. In Paris such a comparison is not easily made, as produc­
tion on a large scale is not extensively carried on. In the departments
of France outside the Seine it was found that concentration of indus­




FOREIGN STATISTICAL PUBLICATIONS---- FRANCE.

325

tries had a tendency to lessen the fluctuations in the number of persons
employed, thus insuring greater stability of employment. It shortened
the hours of labor and made them less liable to variation, and it had a
tendency to increase the average wage rates. These favorable tenden­
cies were not only manifested in establishments which were necessarily
carried on on a large scale, such as mines, railroads, etc., but also in
other industries where concentration of enterprises had taken place.
By grouping the establishments according to the number of persons
employed, it was found that the average wages were 3.15 francs ($0.61)
for males and 1.60 francs ($0.31) for females in establishments employ­
ing from 1 to 24 persons; 3.55 francs ($0.69) for males and 1.80 francs
($0.35) for females in establishments employing from 25 to 99 persons;
3.85 francs ($0.74) for males and 1.80 francs ($0.35) for females in
establishments employing from 100 to 499 persons; 3.80 francs ($0.73)
for males and 1.80 francs ($0.35) for females in establishments employ­
ing from 500 to 999 persons, and 4.45 francs ($0.86) for males and 2.15
francs ($0.41) for females in establishments employing 1,000 and more
employees, thus showing an almost steady increase in wages with the
size of the establishment, when all industries considered are taken
collectively.
Cost of Living.—In determining the cost of living of the working
people the French labor bureau took the following subjects into con­
sideration: (1 ) Prices paid in 1893 by public institutions, hospitals,
schools, etc., for certain articles of consumption; (2) average prices of
certain commodities in 1896 as furnished by a number of cooperative
societies in France; (3) prices paid for board and lodging by working­
men in cities and towns as reported by local public authorities; and
(4) expense budgets of fourteen families of employees in a spinning
mill in the department of the Oise, France.
W ages D uring Fifty Y ears.—No exact statistics exist regarding
the hours of labor and duration of employment in past years. The
only statistics available by which the improvement in labor conditions
may be measured are wage data obtained from the reports of the
industrial inquiries of 1840-1845 and 1860-1865, the annual inquiries
made by local officials in 1853, 1857, and from 1871 to 1885, and the
statistics of the mining service.
The two tables following show average daily wages in the depart­
ment of the Seine and in the other departments of France, by sex
and industries, according to the inquiries of 1840-1845, 1860-1865, and
1891-1893.




326

BULLETIN OF THE DEPARTMENT OF LABOR.

A V E R A G E D A I L Y W A G E S OF W O R K IN G PE O P L E IN T H E D E P A R T M E N T OF T H E
SEIN E. B Y S E X A N D IN D U S T R IE S , IN Q U IR IE S OF 1840-1845, 1860-1865, A N D 1891-1893.
In q u iry o f 1860-1865.

Inquiry o f 18401845 (suburbs
o f P a n s).

Industries.

Males.

| F e­
males.

F lour m illin g ............... .......................
Fee ala m anufacturing......................
Sugar r e fin in g .....................................
B re w in g ................................................ ;
P astry and con fection ery................. ;
Chemical products and fertilizers..
Oil w ork s..............................................
G lu e .......................................................
Stearine, soap, and perfum ery.........
M a tc h e s ................................................
Paper and pasteboard........................
P r in tin g ................................................
T a n n in g ................................................
Cotton thread.......................................
S a w m ills ..............................................
Surgical instrum ents........................
M u sic boxes and in stru m en ts........
B rick and tile w ork s....... ..................
China and p o t t e r y ..............................;
G la s s ......................................................I

$0. 58
. 56
.58 ! $0.39
. 58
. 68
. 24
.58
.53
.48
.58
.28
.43
.25
.64
.24
.80
.39
.87
.68
.26
.77
.58

A ll in d u s trie s ..........................1

.68
.77
.68
.68
.68

Suburbs o f
Paris.

Paris.
Males. | F e ­
males.

$0. 68 , $0.39
. 77
. 77
.29
.58

.24
.14
.24

. 58
.60
.77
.77
.97
. 85
. 77
.77
.97
.97
.97
.58
.97

.34
a 1.25
.48

.30

.87

.41

Males.
$0. 58
. 72
.48
. 80

F e­
males.

$0. 24

. 68
. 60
. 52
.62
.48

.39
.39
.39

.34
.24
.24

.66

.39

In q u iry o f 18911893 (depart­
m ent o f the
Seine).
Males.

F e­
males.

$1.13 .............
. 93
l! 06
$0. 63

1.01

Q)0
^
.X
. 91
1. 08
. 81
.*97

. 52

.46

1.01

.68

1.16
1. 37
1.05
1.03
1.16
1. 50

.60

.87
. 77
.87

. 29
! 39

.68

.26

.75

.31

1.12
.99
1. 06
1.12

.77

.33

1.19

. 61
'.55

43
. 69
.42
~

.58

a This amount seems out o f proportion to other wages paid at this period. I t is the equivalent, how ­
ever, o f the figure published in the report, 6.50 francs, w hich is probably a typographical error.
A V E R A G E D A I L Y W A G E S OF W O R K IN G P E O PLE IN T H E D E P A R T M E N T S OF F R A N C E
O T H E R T H A N T H E SEIN E , B Y S E X A N D IN D U S T R IE S , IN Q U IR IE S OF 1840-1845, 18601865, A N D 1891-1893.
A verage daily wages.

Industries.

In q u iry o f 1840- Inquiry o f 1860- Inquiry o f 18911845.
1865.
1893.
Males.

F e­
Males.
males.

M ines and quarries....................
F ood p rod u cts..............................
Chemical products .....................
Printing and publishing...........
H ides and le a th e r ......................
T e x t ile s .........................................
C lothin g.........................................
W ooden g ood s..............................
F u r n itu r e .....................................
Metal g o o d s .................................
B uilding (s to n e w o r k )...............
Glass, china, e t c ..........................

$0.38
.37
.41
.40
.39
.37

$0.16

.36

.15

.46
.39
.37

A ll in d u s tries ...................

.40

F e­
males . Males.
$0.21
.18

.19
.16
.17

$0. 44
.41
.42
.48
.42
.40
.43
.46
.48
.53
.40
.41

.20

.53

.25

.20
.21

.19
.19
.19

.22
.21
.21
.18
.21
.22
. 23
.23

.21
.20

F e­
males.

P er cent o f women
and children o f
total
w orking
people.
In q u iry
o f 18601865.

10

In q u iry
o f 18911893.

$0.79
.70
.71
.77
.71
.67
.69
.72
.70
.81
.69
.77

$0.31
.39
.36
.41
.41
.41
.37
.37
. 30
.34

.22
.38

19
25

5
27

.77

.42

35

27

18
23
42
9
55
65

12
10

38

14

22
11

42
26
56
58

10
36
12

In the table following are shown the average daily wages in 1853,
1874, and 1892, as furnished by local officials of cities and towns in the
departments of France other than the department of the Seine.




327

FOREIGN STATISTICAL PUBLICATIONS— FRANCE.

A V E R A G E D A I L Y W A G E S OF W O R K IN G P E O PLE R E P O R T E D B Y L O C A L O F F IC IA L S
I N T H E D E P A R T M E N T S OF F R A N C E O T H E R T H A N TH E SEINE, B Y OC C U PA TIO N S,
1853, 1874, A N D 1892.

1

Occupations.

1853.

1874.

$0.41
$0. 57
Saddlers and harness m a k e r s ......................................................................................
.32 I
. 50
Shoem akers.......................................................................................................................
.40 1
.59 |
C artw rights...........................................- ..........................................................................
.42 !
. 67
C arpenters.........................................................................................................................
. 37 !
. 56
H orsesh oers.......................................................................................................................
.39
. 63
Plum bers and tinsm iths................................................................................................
.30
. 49
E xcavators.........................................................................................................................
.40
.61
Masons ........................................ - ...............................- ............................................... .. '
.42
.62
H ouse painters............................................................................ : ..................................
A ll o ccu p a tion s................. .......................... ......................................................

.38

.58

1892.
$0. 72
. 64
.73
.83
.71
.82
.61
.77
.82
.74

During the period mentioned wages of males have almost doubled,
while those of females have more than doubled. The proportionate
increase has not been the same, however, in all industries, nor in all
the departments of France.
A comparison of wages and prices of commodities shows that while
wages increased about 100 per cent in fifty years the prices of the
necessaries of life—that is, rent, food, heat, light, and clothing—when
taken collectively, have increased about 25 per cent. The statistics of
consumption, however, show that as wages increased the needs have
also augmented, and what formerly was regarded as luxury has become
necessity, and thus the consumption has increased very largely with
the increase of wages.
State

and

Communal E

I n d u s t r y .—In

s t a b l is h m e n t s

and the

Tran spo rta­

State and communal establishments the hours
of labor and stability of employment were more favorable to employees
than in private establishments, while the wages were nearly equal.
The same was true in the case of employees of railway companies.
The stability of employment was much greater, while the average hours
of labor were 10 per day as compared with 10J in private establish­
ments.
As regards wages of employees, it was found that while the average
wages in private establishments were 6.15 francs ($1.19) in the depart­
ment of the Seine and 3.90 francs ($0.75) in the other departments for
10£ hours of labor, the wages in State and communal establishments
were 6.30 francs ($1.22) in the department of the Seine and 3.90 francs
($0.75) in the other departments for shorter working hours.
In the railway service the average daily wages were 4.50 francs ($0.87)
for about 10 hours’ work, while in private establishments in France the
average wages were 4.20 francs ($0.81) for 10| hours’ work.
It may be added that with regard to sick benefits, old-age pensions,
and other similar advantages the employees in the public and railway
services were more favorably situated than those in private establish­
ments.
t io n




DECISION'S OF COURTS AFFECTING LABOR.
[This subject, begun in Bulletin No. 2, has been continued in successive issues..
All material parts of the decisions are reproduced in the words of the courts, indi­
cated when short by quotation marks and when long by being printed solid. In
order to save space, immaterial matter, needed simply by way of explanation, is
given in the words of the editorial reviser.]

DECISIONS UNDER STATUTORY LAW.
C o n d it io n a l

Sa l e s— Ch a t t e l

M

ortgages—

Effect

of

Sta t­

—Speyer et al. v. Baker, 51 Northeastern Reporter, page 442.— The
original action was replevin brought by Speyer & Co. against Margaret
Baker before a justice of the peace in Hamilton County, Ohio, to recover
possession of a lot of household goods. In the court of common pleas,
on appeal, where issue was joined on the plaintiffs7right of possession,
the verdict and judgment were in their favor. That judgment was
reversed by the circuit court, and the plaintiff's, Speyer & Co., brought
the case upon a writ of error before the supreme court of the State,
which rendered its decision October 11,1898, and affirmed the judg­
ment of the circuit court. The record showed that Speyer & Co., whose
business was that of selling household furniture on the installment plan,
sold in that way to the defendant goods of that kind to the amount of
$885.55 on the 31st day of May, 1893, and on the 3d of July, 1893, other
goods of a like kind to the amount of $18.75. Upon the first of these
purchases the defendant paid in cash $100 and agreed to pay the bal­
ance in weekly installments of $7.50 each, and upon the other purchase
she paid $5 in cash, the payment of the balance to be made in weekly
installments of $1.50 each. At the time of each sale a chattel mort­
gage was taken by the plaintiffs on the goods sold, which was duly filed
in the proper office. These mortgages were alike in all respects, except
in the amounts and the description of the property. Provisions in the
mortgages practically nullified the provision of the State law regulating
conditional sales of personal property to the effect that when upon a
failure o f the purchaser to pay installments as agreed the vender
attempts to take possession of the property he must first tender or
refund to the purchaser the installments already paid, less a reasonable
compensation for the use of the property. The principal point of con­
tention in this case was whether the provisions of the mortgages or the
provision of the State law should obtain in the settlement of the trans­
action, and the decision upheld the law. The record also shows that
the defendant paid her weekly installments on both purchases until her
payments, including the amounts paid at the times of the purchases,
amounted in the aggregate to the sum of $253.50. The last payment
ute

328




DECISIONS OF COURTS AFFECTING LABOR.

329

was made on the 1st day of November, 1893, when, becoming unable to
pay further, she consulted counsel, who sought an adjustment with the
plaintiffs on the basis that she was entitled to a return of part of the
amount she had paid before she could be compelled to surrender the
property. The plaintiffs declined to entertain the proposition, and,
without having paid or offered to pay the defendant any part of the
sum they had received from her, brought the suit before the justice.
From the opinion of the supreme court, delivered by Judge Williams,
the following is quoted :
The contention in this case relates to the application to the transac­
tions involved of the act of May 4, 1885 (82 Ohio Laws, 238), now sec­
tions 7913-72, 7913-73, of the Eevised Statutes. The statute, in terms,
applies to all sales of chattels uto be paid for in whole or in part in
installments, on condition that the same shall belong to the person
purchasing the same whenever the amount paid shall be a certain sum,
or the value of the property, the title to remain in the vendor until
such sum, or the value of such property or any part thereof shall have
been paid.” And it is made unlawful for any vendor of chattel property
so sold, u or his agent or servant, to take possession of such property with­
out tendering or refunding to the purchaser the sum or sums of money
so paid after deducting therefrom a reasonable compensation for the use
of such property, which shall in no case exceed 50 per cent of the amount
so paid, anything in the contract to the contrary notwithstanding, and
whether such condition be expressed in such contract or not, unless
such property has been broken or actually damaged, and then a reason­
able compensation for such breakage or damage shall be allowed.”
There was evidence at the trial, though it was not without conflict,
from which the jury might have found that the sales made by the plain­
tiffs to the defendant of the property in question were conditional sales,
of the character defined by the statute; and the instructions which
were requested, but refused by the court, were to the effect that, if
the jury should find the sales to be of that nature, the defendant’s rights
under the statute were unaffected by the mortgages given to secure
installments of the purchase price of the property. The refusal to so
charge, and the charge given, appear to be placed upon the ground
that the mortgages rendered the statute inapplicable; and that is the
position taken by counsel for the plaintiffs in error, who express some
apprehension that any other holding would discourage sales on credit,
and unsettle chattel mortgage securities. We see no good grounds for
giving the mortgages the effect claimed for them, nor any sufficient
cause for the apprehension expressed. Bona fide, absolute sales of chat­
tel property are not within the operation of the statute; neither are
mortgages made in good faith to secure the purchase price of property
sold at such a sale, nor mortgages made in good faith on property owned
by the mortgagor to secure a valid debt arising otherwise than upon a
conditional sale of the property. But the rights of parties to all
conditional sales of personal property, as defined by the statute, are
controlled by its provisions, and we find nothing in the statute which
indicates an intention that those rights should be changed or affected
in any way by the vendor taking a mortgage on the property. On the
contrary, the statute appears to have carefully guarded against that
result. It preserves in explicit terms to the purchaser at such a sale
the benefits of provisions, even against the express stipulation in the
contract to the contrary, and though the contract be put in such form
9986-—No. 21----- 11



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BULLETIN OF THE DEPARTMENT OF LABOR.

that the conditional character of the sale is not shown. The policy of
the statute in this respect seems manifest. Purchasers on this plan are
usually persons of small means, and unable to pay except in install'
ments; and such sales are, partly on that account, made at prices in
excess of those charged in other cases. Payment of part of the install­
ments may amount to more than the actual worth of the property; and,
on account of the unconscionable advantage which the vendor could
otherwise have, by taking the property and retaining the money paid,
the legislature deemed it proper to adopt the equitable rule of adjust­
ment prescribed by the statute. That rule, when properly observed,
will, we believe, be found fair and just to both parties. A t all events,
it enters into, and becomes a part of, every contract of conditional sale
made after its adoption,—as much so as if expressly embodied therein.
And it is obvious that the statute would fail of its purpose, if any
instrument which the vendor might choose to exact at the time of sale
could preclude an inquiry into the real nature of the transaction, or
deprive the purchaser of the benefit of its provisions.
By our statute, in cases of conditional sales a purchaser who has
made oue or more payments upon the property is entitled fco its posses­
sion, notwithstanding his failure to make further payment, until the
seller refunds or tenders back the amount so paid, less a reasonable
compensation for its use and for any damage to it. The compensation
allowed the seller for the use of the property is in no case to exceed 50
per cent of the amount received by him from the purchaser. The sum
which the purchaser is so entitled to have refunded constitutes the
value of his right of possession, and should be awarded him as damages
when the property is taken in replevin at the suit of the vendor before
the amount has been refunded.

C o n st it u t io n a l it y and C onstruction of St a t u t e — C ompen ­
C oal M in er s — Whitebreast Fuel Co. v. People, 51 Northeast­

sation of

ern Reporter, page 853.—In the circuit court of Fulton County, 111., the
above named company was convicted of a violation of section 1 of an
act entitled “ An act to provide for the payment of coal miners for all
coal mined by them, and providing additional duties for mine inspect­
ors.” [Laws 1897, page 270. Act approved July 1,1897.] Said com­
pany appealed the case to the supreme court of the State, which
rendered its decision October 24,1898, and reversed the judgment of
the lower court.
Judge Cartwright, in delivering the opinion of the supreme court,
used the following language:
The section which the defendant is charged with violating is as fol­
lows: “ That every person engaged in mining coal for any corporation,
company, firm, or individual shall be paid in lawful money of the
United States for all coal mined and loaded into the mine car by such
person for such corporation, company, firm, or individual, including
lump, egg, nut, pea, and slack, or other such grades as said coal may be
divided into, at such price as may be agreed upon by the respective
parties.”
The following are the material facts as stipulated: For seven years
prior to July 1 , 1897, the defendant had operated a coal mine at Dun­



DECISIONS OF COURTS AFFECTING LABOR.

331

fermline, in Fulton County. During tliat period there was sometimes
a demand for what was called Urun of the mine” coal, which embraced
the entire product as mined, without screening, and a small per cent of
the coal produced was sold in that way to meet that demand. For
mining that coal each miner received pay at a certain price per ton for
the entire coal mined by him and weighed as it came from the mine.
About 95 per cent of the coal mined was screened for the market, and
for such coal the miners were paid a certain price per ton for the
screened lump coal, which was a higher price than that paid on the
“ run of the mine” product, the proportion being about as 60 to 45,
but, where the coal was screened and the higher price paid for the
screened lump coal, no account was taken of the nut and slack coal
screened out, and nothing was paid upon those grades. The miner
named in the complaint had been in the employ of defendant at the
mine for about six years, and had received his money and made his
settlements for mining upon the basis stated, receiving his agreed pay­
ment in that way, the same as the other miners.
It is now insisted that the section in question is an invasion of the
constitutional right of the employer and employee to contract with each
other as to the compensation of the employee and the manner in which
it shall be ascertained, and that it is therefore in conflict with the con­
stitution. We are not prepared to say that such is the effect of the act.
The provision is that the owner or operator of a mine shall pay to the
miner “ at such price as may be agreed upon by the respective parties.”
It leaves the employer and miner free to contract with each other upon
any terms that may be mutually agreeable, without restraint. The
agreement may be for a certain rate, according to the time employed or
the quantity of coal mined, or upon any other basis. If the compensa­
tion is fixed by the amount of coal mined, the act leaves them free to
determine the quantity of such coal upon any basis they may see fit.
It does not require that it shall be weighed or measured, or compel the
parties to adopt any particular mode of ascertaining such quantity.
The act does not require that the same price shall be paid for each of
the different grades into which the coal may be divided, but only under­
takes to require that the employer shall perform his contract by paying
at such price as may be agreed upon by the respective parties. We
can not ascribe to the legislature an intention to reenact, in a somewhat
different form, a provision designed to interfere with the freedom of
contracting between citizens, and which has been uniformly held to be
an encroachment upon the liberty and rights of the laborer and his
employer.
It appears to have been the design of the legislature to eliminate
from this act the objectionable features of former enactments by mak­
ing contracts enforceable according to their terms, instead of attempt­
ing to make contracts for the parties. It is made essential to a violation
of this act that a price shall be agreed upon by the respective parties
including the various grades of coal specified in the act. In this case
a less price was satisfactory to the parties when paid on the basis of
“ run of the mine” or unscreened coal than when the payment was made
on the basis of the screened product. The statement of facts shows
that the defendant complied with the terms of its contract, and paid
the miner named in the complaint according to the understanding of
the parties, as was done in the case of Ramsey v. People, 142 111., 380,
In that case the employer, by contract with the miner, paid for the coal
mined at a certain price for the screened coal, substantially in the man­
ner in which the appellant was accustomed to pay by an understanding



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BULLETIN OF THE DEPARTMENT OF LABOR.

with its miners, and the act requiring payment on the weight of coal
before it was screened, regardless of the contract, was held to be in
violation of the constitution. In Jones v. People, 110 111., 590, an act
to provide for weighing coal at the mines was under consideration, and
it was said that the act left it free for the owner or operator of the coal
mine to make contracts with the miners to mine coal for whatever
might be agreed upon between them, and where the contract was for
the paying of wages in some other way than that specified in the act
its provisions did not apply. We have reached the same conclusion as
to this act, and must hold that its provisions do not apply where there
is a contract for the payment of compensation by different means or
upon a different basis than that specified in the act. To hold otherwise
would render the enactment unconstitutional. It has been uniformly
decided that a laborer can not be deprived of the right to make his own
contracts and exercise his own judgment as to how much he will receive
for his labor and what he will receive as payment.
The agreed statement of facts shows that the defendant paid to the
miner named in the complaint for the coal mined by him according to
the understanding of the parties, which had been carried out for six
years between them; that the higher price per ton paid for screened
lump coal was intended by the parties as payment for the coal mined;
and that no price had been agreed upon by the parties for the nut and
slack coal, of which no account was taken by them. The conviction
was wrong, under the facts. The judgment is reversed, and the cause
remanded.

C o n st it u t io n a l it y of S t a t u t e — M ech anics ’ L ie n s —Slocum et
al. v. Bear Valley Irrigation Go. et al., 55 Pacific Reporter, page 403.—
In the superior court of San Bernardino County, Cal., M. L. Slocum
and three others recovered judgments declaring and enforcing in their
favor mechanics’ liens upon the property of the corporation above
named. From these judgments the irrigation company appealed the
case to the supreme court of the State, which rendered its decision
December 5,1898, and reversed the judgment of the lower court. The
liens were based upon the act of the legislature entitled uAn act to
provide for the payment of the wages of mechanics and laborers
employed by corporations,” approved March 31, 1891 (chap. 146, acts
of 1891, p. 195), which reads as follows:
Section 1. Every corporation doing business in this State shall pay
the mechanics and laborers employed by it the wages earned by and
due them weekly or monthly, on such day in each week or month as
shall be selected by said corporation.
Se c . 2. A violation of the provisions of section 1 of this act shall
entitle each of the said mechanics and laborers to a lien on all the
property of said corporation for the amount of their wages, which lien
shall take preference over all other liens, except duly recorded mort­
gages or deeds of trust; and in any action to recover the amount of
such wages or to enforce said lien, the plaintiff shall be entitled to a
reasonable attorney’s fee, to be fixed by the court, and which shall form
part of the judgment in said action, and shall also be entitled to an
attachment against said property.




DECISIONS OF COURTS AFFECTING LABOR.

333

The opinion of the supreme court contains the following language:
It is contended by appellants that the act in question is unconstitu­
tional for various reasons, and, among the others, for the reason that it
is special legislation, inhibited by the constitution, because it attempts
to provide for the creation of liens in favor of a special class of labor­
ers, and thus attempts a mere arbitrary classification not founded upon
natural differences, or differences defined by the constitution, within
the meaning of the principle declared in Darcy v. San Jose, 104 Cal.,
642; 38 Pac., 500, and other decisions of this court to the same point.
This contention is correct if the said act provides a lien only for those
laborers and mechanics who are employed by the week or month, and
does not provide liens for those who are not thus employed. But this
court has already declared such to be the construction of the act in two
cases.
Since the date of the decisions in those cases the legislature has been
in session, and has not seen fit to change the statute; and whether the
statute as thus construed is a proper and wise law, or whether it should
be in any manner changed, are now questions for legislative discretion.
Following the construction given to the act by the decisions above
noticed, we hold it to be unconstitutional.

C o n st itu t io n a lit y of S ta t u t e — T r a d e - M a r k s of T r ad e
U nions —Sclimalz v. Wooley et al., 41 Atlantic Reporter, page 939.—

This case was heard in the court of chancery of New Jersey upon a bill
filed by Frederick W. Schmalz, president of the Union Hat Makers’
Association of Newark, N. J., for an injunction against Edwin Wooley
and Frederick S. Crane to prevent them from using the trade label of
the United Hatters of North America or any counterfeit or imitation of
the same upon hats made by them. Said injunction was refused upon
several grounds, one of which was that the act approved March 27,
1889, regulatingtrade-marks, etc., of associations or unions of working­
men and the acts approved March 23,1892, and March 14,1895, supple­
mental thereto were unconstitutional and void. [See Bulletin of the
Department of Labor, No. 17, p. 637.] The case was appealed to the
court of errors and appeals of the State, which rendered its decision
November 14, 1898, and reversed the decision of the court of chancery.
The opinion of the court of errors and appeals, delivered by Judge
Dixon, reads in part as follows:
The act of 1889 [Gen. Stats., 1895, p. 3678, secs. 1 to 7, inclusive] is
entitled “ An act to provide for the adoption of labels, trade-marks,
and forms of advertising by associations or unions of workingmen, and
to regulate the same.” It provides (sec. 1) that it shall be lawful for
associations and unions of workingmen to adopt, for their protection,
labels, trade-marks, and forms of advertisement, announcing that goods
manufactured by members of such associations or unions are so manu­
factured; (sec. 4) that every such association or union adopting a label,
trade mark, or form of advertisement as aforesaid shall file the same in
the office o f the secretary of state, by leaving two copies, counterparts
or facsimiles thereof, with said secretary; and (sec. 5) that every such



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BULLETIN OF THE DEPARTMENT OF LABOR.

association or union adopting, etc., may proceed by suit in the courts of
this State to enjoin the manufacture, use, display, or sale of any coun­
terfeit of their label, trade-mark, or form of advertisement; and that
all courts having jurisdiction thereof shall grant such an injunction.
The demurrants do not deny that the bill presents a case in conformity
with this act, except in this respect: That under the act the bill should
be filed by the association, or all its members, and not by one member
alone. In our opinion, the act empowers the association to proceed by
suit, making it for this purpose a quasi corporation, and therefore does
not of itself entitle a single member to maintain the action. But this
objection is obviated by section 4 of the act of 1892 [Gen. Stats., 1895,
p. 3679, secs. 8 to 14, inclusive], if valid, which provides for the bringing
of such proceedings in the name of any member duly authorized by the
association or union for that purpose. W e are therefore brought to the
main question raised as to these statutes.
The demurrants contend that the act of 1889 violates that provision
o f the constitution (article 4, sec. 7, par. 11) which forbids the passage
of private, local, or special laws granting to any association, corpora­
tion, or individual any exclusive privilege, immunity, or franchise what­
ever. Their position is that, as the privileges of this act are confined to
associations or unions of workingmen for the protection of goods manu­
factured by their members, and are not offered to other workingmen
who may not choose to form associations or unions, or to persons gen­
erally, the privileges are therefore exclusive, and the act is special. We
do not agree to this conclusion. All the legislation of the State respect­
ing societies, associations, and corporations is based upon the idea that
privileges which are denied to single individuals maybe conferred upon
groups of persons; and nothing in the constitution was intended to sub­
vert this doctrine. I f the legislature offers to any class of persons privi­
leges peculiarly appropriate to their class, on condition that several of
them shall unite for the purpose of accepting and exercising them, the
constitution will not therefore be infringed. The privileges of this act
are offered to all workingmen engaged in the manufacture of goods, who
thus unite, and they relate to goods of every description manufactured
by them. Certainly workingmen engaged in the manufacture of goods
constitute a distinct class of persons, and there is a manifest appropri­
ateness in enabling any of them who comply with the act to provide and
protect a mark distinguishing the products of their labor and skill.
Nor is it at all necessary that a similar privilege should be given to
those who are not workingmen, but are only employers of workingmen.
Such persons stand in a different class with respect to the exercise
of those faculties which the legislature intended to foster. W e think
this act is constitutional.
The act of 1892, with its amendment of 1895 [Gen. Stats., 1895, p. 3679,
secs. 8 to 18, inclusive], seems not to be exposed to the objection just
considered; for their provisions extend to any persons and any asso­
ciations or union of workingmen adopting a label or trade-mark to
distinguish any merchandise or product of labor made, packed, or put
on sale by such persons, association, or union. But these acts are
assailed on the ground that their titles do not comply with that pro­
vision of the constitution (article 4, sec. 7, par. 4) which declares that
“ to avoid improper influences which may result from intermixing in
one and the same act such things as have no proper relation to each
other, every law shall embrace but one object, and that shall be
expressed in the title.” The title of the act of 1892 is, “ A further sup­
plement to an act entitled ‘An act to protect trade-marks and labels.7”



DECISIONS OF COURTS AFFECTING LABOR.

335

th at of the act of 1895 is “ An act to amend an act entitled fcA further
supplement/ 77 etc. (quoting the title of the act of 1892). The objection
urged is that there existed no act entitled “ An act to protect trade­
marks and labels/7and therefore entitling these acts as supplements or
amendments of such an act was misleading. But, conceding this, the
inquiry is not concluded. The question still remains, Was the title
misleading as to the object of the act? Did not the title, in spite of its
false assumption of the existence of a prior statute, fairly express the
object of the proposed legislation? On reading the act it will be per­
ceived that its object is to protect trade-marks and labels, and that for
this purpose it is a complete and independent enactment. To express
that object in the title, no particular form of words is required, nor is
it necessary that the object would be expressed with precision. It is
enough if the title be so phrased as to inform the legislators and the
public of the subject matter of the act. Tested by this standard, these
titles seem to be sufficient. They clearly indicate that the subject of
legislation is trade marks and labels, and that the purpose is to protect
them. True, they state that this is to be done in the form of supple­
ments, but that does not affect the object of the statutes. In our
legislation a formal supplement to an act is not necessarily a statute
which supplies defects in its predecessor. It may be one that abrogates
the preceding enactments, and substitutes radically different provi­
sions. Hence the mere calling of an act a supplement to another desig­
nated act expresses nothing of its object. Thus, if the title were, “ A
supplement to assembly bill No. 10, which became a law on July 4,
1876,” the constitutional requirement would not be satisfied because
the title would not at all express the object, while the title, “ An act to
define more accurately the crime of murder of the first degree/7 would
fully express the object, although the act, in form and substance, were
only a supplement to section 68 of the crimes act. Entitling an act a
supplement to a former act complies with the constitution only when so
much of the original title is recited as expresses the object of the pro­
posed law; and, if that object be expressed, the constitution does not
defeat the statute merely because it is erroneously styled a supplement.
We therefore conclude that these acts are valid, so far as they are nec­
essary to sustain the complainant’s bill.
We also think that upon general principles the substance of the bill
is sufficient. It alleges: That a company of journeymen hatters, calling
themselves “ The Union Hat Makers7Association of Newark, New Jer­
sey/7 have, in common with similar associations formed elsewhere,
adopted a certain label or trade-mark; that for ten years last past they
have used said label or mark to designate and distinguish the hats
made by members of the association, by affixing it upon each of those
hats, and that for about three years last past the defendants have used
a fraudulent imitation of that mark upon the hats made and sold by
them, thereby deceiving the public, violating the rights of the members
of the association, and depriving them of large profits which they would
otherwise have gained. These allegations seem to present a case of
inequitable infringement of the association’s right of property in its
trade-mark or label.
In Me Andrew v. Bassett, 4 De Gex, J. & S., 380, Lord Westbury said:
“ The essential ingredients for constituting an infringement of that right
probably would be found to be no other than these: First, that the
mark has been applied by the plaintiffs properly (that is to say, that
they have not copied any other person’s mark, and that the mark does
not involve any false representations); secondly, that the article so



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BULLETIN OF THE DEPARTMENT OF LABOR.

marked is actually a vendible article in the market; and, thirdly, that
tbe defendants, knowing that to be so, have imitated the mark for the
purpose of passing in the market other articles of a similar descrip­
tion.” These views received the approbation of Lord Cairns, sitting
in the court of appeals, in Maxwell v. Hogg, 2 Ch. App., 307-314, and
accord with the great weight of authority on this much litigated subject.
The present bill clearly sets out the adoption and proper application of
the mark by the association, and its fraudulent imitation for the inter­
dicted purpose by the defendants. It is not so explicit as to the second
ingredient mentioned by the lord chancellor, but the court does not
need to be told that hats made by a company of journeymen hatters
during ten years were actually vendible articles in the market. So
much will be inferred.
But the objection urged by the defendants against the bill is that it
does not allege, and the court can not infer, that the journeymen owned
the hats made by them; and it is insisted that the ownership of the
article to which the trade-mark is affixed is necessary to the acquisition
o f a right in the mark. The public object sought in the protection of
trade-marks is to bring upon the market a better class of commodities,
and the means for attaining that object is by securing to those who are
instrumental in supplying the market whatever reputation they gain
by their efforts towards that end. The workman by whose handicraft the
commodity is made is one of these instruments, just as is his employer
who furnishes the raw material and owns and sells the finished prod­
uct; and if the former is permitted by the owner to place upon the
commodity a mark to indicate whose workmanship it is, and thereby
commend his workmanship to other employers, this license from the
owner should be deemed a right against everybody else. His aptitude
in his trade is his property, and if by a mark he can have it identified
as his in the market, he may enhance its saleable value, and thus secure
the same sort of advantage as his employer, by similar means. No
reason exists why this advantage should not be protected by the courts
in the same manner and to the same extent as is the like advantage of
the employer. The mere fact that one rather than the other of these
persons has placed the product upon the market has no rational bear­
ing upon the matter; for both alike have had the market in view in the
efforts they have made, and through those efforts the market is sup­
plied. A different objection to a suit of this nature was sustained in
Weener v. Brayton, 152 Mass., 101; 25 N. E., 46, namely, that the label
did not indicate by what persons the articles labeled were made, but
only indicated that they were made by one of many persons who were
not connected with each other in any business. The first clause of this
objection would unduly restrict the law of trade-marks as everywhere
recognized; for it is established that, whatever be the quality indicated
by a trade mark, the mark need not point out the particular person from
whom that quality is derived. The law has placed no limit upon the
number of persons who may unite for business purposes and jointly ac­
quire property in a trade-mark; and yet it is evident that, if there be
many, some of them may have no personal share in producing the article
identified by the mark. The second clause in the objection assumes
what does not appear to be true in the case before us. We understand
from the bill that the members of the association represented by the
complainant are connected together as journeymen hatters; that their
skill in this trade, and their mutual assistance in profiting by its prac­
tice, form the motive and chief aim of their association. This connec­




DECISIONS OF COURTS AFFECTING LABOR.

337

tion is as clearly one for business purposes as is that of members in a
partnership, or of stockholders in a corporation. Although it is a com­
paratively novel species of relationship, it has become an established
one, and therefore calls for the application of those general principles
of law and equity which are applied to other species of business asso­
ciations. According to these principles, we think a workman, or a num­
ber of workmen engaged in the same branch of industry and banded
together for their mutual profit, in the pursuit of their common vocation,
may acquire a right of property in a trade-mark designed to distinguish
their workmanship from that of other persons, and that a trade-mark
so owned is entitled to the same protection as other trade marks. The
decree below should be reversed, and the demurrer overruled.

E ffect of S t a t u t e P r o h ib itin g th e I ssuing of Ch ecks in
P a ym e n t of W ages upon th e R ights of th e P u r c h aser of
th e Sam e from E m p l o y e e s —Naglebaugh v. Harder & Hafer Coal

Mining Co., 51 Northeastern Reporter, page 427.—Action brought in the
circuit court of Sullivan County, Ind., by John Naglebaugh against
the above-named company. Judgment was rendered for the defendant
company, and the plaintiff appealed the case to the appellate court of
the State, which rendered its decision October 11 , 1898, and affirmed
the action of the lower court.
The facts in the case and the reasons for the decision are fully set out
in the opinion of the appellate court as delivered by Judge Wiley, and
the following is quoted therefrom:
The only question presented by the record is the action of the court in
sustaining a demurrer to the complaint. The appellant was plaintiff,
and, refusing to amend, judgment was rendered against him for costs.
The complaint is in two paragraphs. In the first it is charged that
appellee is a corporation; that it owned and operated a coal mine; that
it employed a large number of men in mining coal; that for three years
appellee issued to and circulated among its employees brass checks,
which represented money due such employees for labor; that said
checks were payable at the store of Patton & Baldridge, at Gframmercy
Park, Ind., where said mine was located; that said checks represented
an amount due from the appellees to the holders; that appellant was
in business near said mine, and, in business transactions with said
employees, purchased their claims for a valuable consideration, and
received from them, as evidence of their claims, said brass checks; that
said checks so purchased represented in the aggregate $500; that
appellant is not now able to give the names of the persons from whom
he purchased said checks; that he presented them to said Patton &
Baldridge for payment, which was refused; that he also presented them
to appellee for payment, which was likewise refused; and that the
amount represented by them is due, etc. The second paragraph is
identical with the first, except that it does not aver that the checks
were presented to Patton & Baldridge for payment.
In the language of the complaint, ua copy of fac simile of the inscrip­
tion of said checks” are made exhibits. There are three of them, and
one is as follows: [Here the opinion shows a representation of a circu­




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BULLETIN OF THE DFPARTME&T OF LABOR.

lar check.] Oil one side of the check above set oat are impressed the
words and figures “ Good for 1.00 in trade,” and on the reverse side the
words “ Patton & Baldridge, Grammercy Park, Ind.” The other two
are just like the above, except one calls for 50 and the other for 25
cents.
It is difficult to understand upon what theory the complaint pro­
ceeds. It is plain, however, that appellant seeks a recovery upon one
o f two theories: (1) Upon the brass checks, which he describes in his
complaint, and which he makes his exhibits thereto; or (2) upon an
account for work and labor performed by the employees of the appellee,
and an assignment thereof to him by such employees. I f he relies upon
the latter theory, his complaint is radically defective for two reasons:
(1 ) There is no sufficient statement, in the complaint or bill of particu­
lars accompanying it as an exhibit, of the work and labor performed
by such employees; and (2) such employees are not made defendants
to answer as to their interests, and no sufficient showing is made why
they are not. W e must assume, therefore, that this is not the theory
upon which the complaint proceeds, but that the plaintiff has grounded
his action upon the checks. Upon the latter theory, it seems clear to
us, no cause of action is stated. These checks show on their face that
they were only good “ in trade” at a fixed and definite place, and that
was at Patton & Baldridge’s. It is also charged in the complaint that
they were made payable there. These checks were not commercial in
their character, and the appellant took them charged with a full knowl­
edge of their infirmities. The complaint assumes that these checks
were valid, and it appears to us that the action is predicated upon them,
and must upon this theory either stand or fall. It must be held, under
the facts pleaded, that these checks were issued to the employees of
appellee in payment, or, at least, in part payment, for labor performed
by them. They were redeemable by appellee at the store of Patton &
Baldridge. As to whether these checks were purchased by appellant
at a discount, as a speculation, we have nothing to do, although coun­
sel have discussed this question.
The issuing of the checks, under the statute, was an unlawful act,
and this appellant admits. Section 7060, Rev. St. 1894 (section 5206#,
Horner’s Rev. St., 1897), provides “ that any person, copartnership, cor­
poration,” etc., “ who shall publish, issue, or circulate any check, card,
or other paper which is not commercial paper payable at a fixed time
in any bank in this State, at its full lace value in lawful money of the
United States, * * # to any employee of such person, copartner­
ship, corporation,” etc., “ in payment for any work or labor done by such
employee, # * # shall be guilty of a misdemeanor, and upon con­
viction shall be fined,” etc. The complaint avers that said checks rep­
resented money due the employees of appellee for work and labor done,
and did in fact represent amounts due from appellee to the holders
thereof. If this is true, then the checks must be regarded as evidences
of indebtedness, or, in other words, a promise to pay money. They
would constitute the contracts between the parties. “ When the object
of the contract is to obstruct justice and duty by defeating the letter
and spirit of the law, the courts will not enforce the agreement. It
would be a travesty upon government. Could its judiciary lend aid to
attempts to defeat the very ends of government 9 It has been repeatedly
and most emphatically decided that contracts contrived for the purpose
of violating statutes are inoperative and void. When such a contract
is in defiance of an absolute provision of the statute, the illegality is



DECISIONS OF COURTS AFFECTING LABOR.

339

more apparent. # # * If an act is forbidden, a contract to do it is
void, whether any penalty be attached or not, for no one can use the
law to effect its violation.’7 (9 Am. & Eng. Enc. Law, p. 909.) It is the
rale everywhere that courts will not enforce a contract made to violate
a statute of the State.
W e must assume that the appellant, when he purchased said checks,
knew that they were issued in violation of a penal statute of the State,
and that in his hands they would create no legal liability against appel­
lee. Suppose these checks were still in the hands of the employees, to
whom they were issued, and appellee refused to pay them. They could
not recover from apx>ellee the amounts represented by the checks, and
make the checks the basis of the action. Their sole remedy would be
to disregard the checks, and sue on the quantum meruit, as for work and
labor performed. The appellant is in no better position to maintain an
action on the checks than the original holders; and, as it is manifest
that they could not do so, it follows that the appellant’s complaint does
not state any cause of action. I f appellant intended to disregard the
checks, and sue upon an account for labor of appellees’ employees, as
upon an equitable assignment, and as an equitable assignee, and ask to
be subrogated to the original rights of such assignors, a different ques­
tion would be presented; but that is not the theory of the complaint,
and hence that question is not before us for decision. The demurrer to
the complaint was properly sustained. Judgment affirmed.

E ig h t -H our L a w — E ffe ct of Sam e on Cit y O rdin ance P r o ­
E nforced L abor on R oads —In re Ashby, 55 Pacific

v id in g for

Reporter, page 336.—Under an ordinance of the city of Fort Scott,
Kans., requiring all male residents between the ages of 21 and 45 to
perform two days’ labor of ten hours each on the streets of the city or
to pay the sum of $3, C. R. Ashby was restrained of his liberty by the
marshal of said city pending a continuance of a prosecution brought
against him in the police court. He petitioned the supreme court of
the State, under a writ of habeas corpus, to be discharged from said
custody on the ground, among others, that said city ordinance was in
violation of chapter 114 of the laws of Kansas of 1891, providing that
eight hours should constitute a day’s work for all laborers, etc., employed
by the State or by any county, city, township, or municipality of the
same. The supreme court rendered its decision December 10, 1898,
and sustained the above contention, and ordered the discharge of the
petitioner from custody.
The following is contained in the opinion of the supreme court, which
was delivered by Judge Allen :
Chapter 114 of the laws of 1891 provides: “ That eight hours shall
constitute a day’s work for all laborers, workmen, mechanics, or other
persons now employed, or who may hereafter be employed, by or on
behalf of the State of Kansas, or by or on behalf of any county, city,
township, or other municipality of said State, except in cases of extraor­
dinary emergency which may arise in time of war or in cases where it
may be necessary to work more than eight hours per calendar day for



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BULLETIN OF THE DEPARTMENT OF LABOR,

the protection of property or human life.7’ It is contended on behalf of
the respondent that this act has no application to the ordinance under
consideration, because subdivision 34 [of section 11 of chapter 18 of
the General Statutes of 1889, under the authority of which the ordi­
nance in question was passed by the mayor and council of the city]
authorizes the council to require the performance of two days’ labor of
ten hours each, and that this provision has not been repealed or amended
either in express terms or by necessary implication. It is also said that
a person working a poll tax under the ordinance is not employed by the
city, within the meaning of the eight-hour law, but that the service
required is in the nature of a tax imposed for the purpose of keeping
the streets and alleys of the city in repair. It is often a matter of great
difficulty to determine how far prior enactments may be changed or
restricted in their operations by subsequent ones which are not in terms
amendatory. It sometimes happens that the legislature has under con­
sideration a special subject, which in some particulars is related to
many matters concerning which prior enactments are in force. It has
never been held that, in order to make the subsequent act valid and
operative, all such prior enactments must be revised and amended so as
to conform to the new act. It is only when the legislature, in passing
the subsequent act, has under consideration the subject matter con­
tained in the former enactment, and is working along the same legis­
lative line, that the subsequent act can fairly be termed amendatory of
the prior.
When the eight-hour law was passed, the legislature had under con­
sideration the general subject of the length of a day’s labor for those
engaged on public works at manual labor, without special reference to
the purpose or occasion of their employment. The leading idea clearly
was to limit the hours of toil of laborers, workmen, mechanics, and other
persons in like employments to eight hours, without reduction of com­
pensation for the day’s service. The validity of this act is not now
attacked, but its effect only is discussed. It is impossible to draw a
distinction between the case of one man who works out his own poll
tax and of another employed by the city to work two days for $3 col­
lected from a third, who chose to pay in money rather than to work out
his tax. That the latter laborer would fall strictly within the provisions
of the law is clear. He would be a laborer employed on the public
streets, and paid directly by the city. The eight-hour law being valid,
he could not be required to perform more than eight hours of service for
a day’s work. Will it be contended that the man who, either from neces­
sity or choice, works out his own tax must labor ten hours for a day,
and may be forced to do four hours’ more service to discharge his tax
than the man employed by the city to render two days’ service for $3?
A laborer on the public streets of a city falls as clearly within the
letter, the spirit, and purpose of the statute as any person we can think
of, and it was for the benefit of such that the eight-hour law was enacted.
The ordinance under which the petitioner is prosecuted was passed
in 1897. It exacts two days’ labor of ten hours each. This is two hours
o f service more per day than the law authorized. The petitioner refused
to comply with this requirement. He was not bound to enter into any
controversy with the city officials as to the length of a day’s employment
by working eight hours, and then refusing to work longer. The city
must first conform its requirements within the limits of the law. Not
till then may it enforce them. The ordinance as passed is invalid, and
will not uphold the prosecution against the petitioner. He is therefore
discharged. All the justices concurring.



DECISIONS OF COURTS AFFECTING LABOR.

341

E m p lo ye rs 7 L ia b il it y — D u t ie s of the E m p l o y e r - C o n tr ib ­
N eg l ig e n c e of E m p l o y e e — E ffect of St a t u t e —Knox­

utory

ville Iron Co. v. Pace, 48 Southwestern Reporter, page 232.—Suit was
brought by John M. Pace against the above-named company to recover
damages for personal injuries incurred by him while employed by said
company as a miner in its coal mine at Briceville, Tenn. The case was
tried in the circuit court of Anderson County, Tenn., and a judgment
was rendered for the plaintiff, Pace. The evidence showed that Pace
and a helper had prepared three blasts on the day of the accident;
that large quantities of dust had accumulated near the place where
they were at work; that they applied fire to the fuse in each of the
three holes and then retreated down the entry about 400 feet, when the
blasts exploded; and that immediately a strong current of wind rushed
down the entry, throwing Pace and his helper to the ground, envelop­
ing them with flames, and burning them severely. The plaintiff
claimed that this was the result of a mine-dust explosion, which was
the theory accepted by the jury in rendering a verdict in his favor, but
the company claimed that the accident was caused by gas and smoke
generated by the explosion of the black powder in the three holes
driven by Pace and his helper, and resulted from their negligence in
the use of the powder and in the method of driving the holes. After
the judgment for the plaintiff in the circuit court the defendant com­
pany carried the case, upon writ of error, to the supreme court of the
State, which rendered its decision November 11, 1898, and affirmed the
judgment of the lower court.
The opinion of the supreme court was delivered by Judge McAllister,
who, after reviewing the evidence and stating that the testimony war­
ranted the finding of the jury in the lower court to the effect that the
accident was caused by a mine-dust explosion, continued, in part, as
follows:
The tenth assignment [of error] is that the court erred in defining
the degree of care required of a master in furnishing a safe room or
entry where the plaintiff should work; and it is insisted that the effect
of the charge is to make the mine owner an insurer of the safety of the
premises where the servant is to work, and an insurer also of the skill
and prudence of fellow-servants. Taking the charge as a unit, we do
not think it warrants the construction contended for, and is in accord
with the general rule that “ it is the duty of the master to'keep his
premises used in the prosecution of his business in a reasonably safe
condition, and, if he fails to do so, he is liable to the servant for all
injuries resulting to him from such defects.77 (Wood, Mast. & S., p. 695,
sec. 334.)
The court, in charging upon the duty devolved on defendant company
to employ a competent mine boss, was fully warranted by chapter 170,
Acts of 1881, entitled uAn act to provide for the ventilation of coal
mines and collieries, and for the protection of human life therein.77 The
eighth clause provides that to better secure the ventilation to either coal
mines or collieries, to provide for the health and safety of the men
employed therein otherwise and in every respect, the owner or agent,



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BULLETIN OF THE DEPARTMENT OF LABOR.

as the ease may be, in charge of every coal mine and colliery, shall
employ a competent inside overseer, to be called a “ mining boss,77 who
shall keep a carefull watch over the ventilating apparatus, airways,
tramways, pumps, timbering, signaling arrangements, tubes, etc., and
all things connected with and appertaining to the safety of the men at
work in the mine. “ He or his assistant shall examine carefully the
workings of all mines generatingexplosive gases, every morning before
the miners enter the coal mine or colliery, and shall ascertain that the
mine is free from all danger.77 The charge in this case is not so strong
as the positive mandate of the statute. The court was certainly in
error in charging the jury that the duty of inspection imposed by this
act only applied to noxious and explosive gases, and does not make it
incumbent on them to remove dust from the mine by reason of inspec­
tion. The positive language of the statute is that the mine boss shall
keep a careful watch over all things appertaining to the safety of the
mine, and shall every morning examine the mine to see that it is “ free
from all danger.77 It is shown that this mine did generate explosive
gases.
The eleventh assignment is that the court erred in defining the
degree of care plaintiff* was required to exercise for his own protec­
tion. The criticism is that the court instructed the jury that, notwith­
standing plaintiff maybe perfectly familiar with all the conditions,—such
as that the mine is a dry one, that there is dust in it, that there is gas
in it, etc.,—and yet, because he does not understand or discover these
things to be dangerous, he may, nevertheless, recover from defendant,
etc. The court had charged that “ if the plaintiff had opportunities
afforded him so that he could have seen and known there was danger
thereof, etc., and if the plaintiff failed to see the danger and avoid it,
he could not recover,77etc. Court also charged: “ It is duty of plaintiff
to use such care and prudence for his own protection, after place to
work is furnished him, as a man of ordinary prudence situated as he
was would have used under the circumstances.77 Again the court
charged that “ if plaintiff knew or had opportunities to know of the
existence of the dust in the entry, and saw the danger therefrom, and
continued in the employment, he could not recover for the injury, nor
could he recover if he was skilled, or had reason to apprehend danger
from an explosion.77
In answer to this assignment of error, it is insisted by learned coun­
sel for defendant in error [Pace] “ that plaintiff would not be barred if
he had merely known of the conditions, but neither knew nor ought to
have known of the danger therefrom, especially when this danger is
established as a scientific conclusion from given facts, and implies a
knowledge which might properly be required of the person placed in
charge of the safety of a coal mine, and yet not be required of an ordi­
nary miner. In such an employment as this, especially where the stat­
ute fixes upon the mine owner the duty of employing a competent mine
boss to look after the safety of the men, while the company is held to
the exercise of a reasonable care and knowledge on the part of the
mine boss, such knowledge is not necessarily required of the employee
who will not be guilty of contributory negligence, unless he has knowl­
edge of the conditions, and ought reasonably to have knowledge of the
danger also.77 The authorities fully sustain the proposition. Says
Wood, in his work on Master and Servant: “ A servant may maintain
an action against his employer for injuries sustained by himself, result­
ing from the negligence of the employer, in a matter in which, from
the nature of the employment, he had a right to rely upon the care and



DECISIONS OF COURTS AFFECTING LABOR.

343

superior knowledge of the employer. It is true that the employee is
bound to exercise all reasonable care and prudence, and, if an injury
result through his want of care, * * * he has no right of action.
But in determining what would be negligence on the part of the work­
man, reference must be had to his limited means of knowledge, to his
ignorance of the structures, machinery, and processes upon which he
is employed,’7etc. “ In an action by a servant to recover damages for
an injury occasioned in the course of his employment, by defective and
unsuitable machinery, it must appear that the machinery was, in fact,
defective, that the injury was occasioned by such defect, and that the
defendant had notice of it, or would have known of the defect if he had
exercised ordinary care.” (Wood, Mast. & S., p. 742, sec. 3665 id., pp.
749, 750, sec. 376.)
u It may be observed in this connection that it is one thing to be aware
of defects in the instrumentalities or plan furnished by the master for
the performance of his services, and another thing to know or appre­
ciate the risks resulting or which may follow from such defects. The
mere fact that the servant knows the defects may not charge him with
contributory negligence, or the assumption of the risks growing out of
them. The question is: Did he know, or ought he to have known, in
the exercise of ordinary common sense and prudence, that the risks,
and not merely the defects, existed1?” (14 Am. & Eng. Ene. Law, p. 844,
note.) The other assignments have been examined but we find in them
no reversible error. The judgment is therefore affirmed.

E m p l o y e r s ’ L i a b i l i t y —R a il r o a d C om panies — N e g l ig e n c e —
C onstruction of S t a t u t e — Florida Central and Peninsular Rail­

road Co. v. Mooney, 24 Southern Reporter, page 148.—A suit, brought by
one John W. Mooney against the above-named railroad company to
recover damages for personal injuries incurred by him while in the
employ o f said company, was heard in the circuit court of Levy County,
Ela., and a judgment was rendered in favor of the plaintiff, Mooney.
The defendant company carried the case upon writ of error to the
supreme court of the State, which rendered its decision June 13, 1898,
and reversed the decision of the lower court. The facts as to the incur­
rence of the injury are not essential to an understanding of the points
of the decision. The decision hinged upon the construction of chapter
4071, Laws of Florida of 1891, the first three sections of which read as
follows:
Section 1. A railroad company shall be liable for any damage done
to persons, stock, or other property, by the running of the locomotives,
or cars, or other machinery of such company, or for damage done by
any person in the employment and service of such company, unless the
company shall make it appear that their agents have exercised all ordi­
nary and reasonable care and diligence, the presumption in all cases
being against the company.
S ec . 2. No person shall recover damages from a railroad company

for injury to himself or his property, where the same is done by his
consent, or is caused by his own negligence. I f the complainant and
the agents of the company are both at fault, the former may recover,



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BULLETIN OF THE DEPARTMENT OF LABOR.

but the damages shall be diminished or increased by the jury in pro­
portion to the amount of default attributable to him.
S e c . 3. If any person is injured by a railroad company by the run­
ning of the locomotives, or cars, or other machinery of such company,
he being at the time of such injury an employee of the company, and
the damage was caused by negligence of another employee, and with­
out fault or negligence on the part of the person injured, his employ­
ment by the company shall be no bar to a recovery. No contract which
restricts such liability shall be legal or binding.
Said chapter was held by the supreme court of Florida in the case of
Duval v. Hunt, 15 Southern Reporter, page 879, to have been adopted
from a statute of the State of Georgia.
The opinion of the supreme court in this case was delivered by Judge
Carter, and from the syllabus of the same, which was prepared by the
court, the following is quoted:
2. To entitle an employee to recover damages from his employer for
personal injuries caused by the negligence of another employee, under
the provisions of chapter 4071, acts of 1891, the plaintiff must himself
have been free from fault, as the provisions of section 2 of that act
relating to the apportionment of damages have no application to such
cases [cases where both the employer and employee were negligent].
3. In an action by an employee under the provisions of chapter 4071,
acts of 1891, to recover damages from his employer for injuries alleged
to have been inflicted by the negligence of another employee in per­
forming some act in the defendant’s service, in the performance of
which plaintiff* as a coemployee was participating, the plaintiff must
show either that he was free from fault himself, or that there was negli­
gence on the part of his coemployee. Upon proof that plaintiff was free
from fault, the statutory presumption arises that the servants of the
defendant were at fault; and it thereupon devolves upon the defendant
to “ make it appear” to the contrary.
4. I f the act resulting in injury to plaintiff, an employee, was one
being performed by other employees in the defendant’s business, but in
the performance of which plaintiff was not participating, then the pre­
sumption of negligence on the part of the agents of the defendant, and
that plaintiff was free from fault, arises under the statute (chapter 4071,
acts of 1891) to the same extent as if plaintiff was not an employee;
and it devolves upon the defendant to relieve itself either by showing
that plaintiff was at fault, or that its servants were not negligent.
5. Where a statute is adopted from a sister State, any known and
settled construction placed thereon by the courts of that State prior to
its adoption, not inharmonious with the policy and spirit of the general
legislation of the adopting State on the subject, will prevail in constru­
ing the statute in the latter State.
6. A servant in the performance of his duties is bound to exercise
ordinary care for his own safety, or that degree of care which prudent
persons usually exercise under similar circumstances; and, if he is
injured by failure to exercise such care, his master is not liable.
7. If, in the performance of his duties, the servant has no instructions
to pursue a particular method, and two or more methods are open to
him, he can not be said to have been negligent if he in good faith adopts
that method which is more hazardous than another, if the one adopted
be one which reasonable and prudent persons would adopt under like
circumstances.



DECISIONS OF COURTS AFFECTING LABOR.

345

8. Shifting cars by means of the “ kicking back” process is not neces­
sarily at all times an act of negligence per se, even though there may
be a safer method of shifting them.
9. In actions for negligence, where there is no evidence tending to
show negligence of so gross and flagrant a character as to evince a
reckless disregard of human life, or of the safety of those exposed to
its dangerous effects, or that entire want of care which would raise the
presumption of a conscious indifference to consequences, or to show
wantonness and recklessness, or reckless indifference to the rights of
others equivalent to an international violation of them, exemplary dam­
ages can not be awarded.

F in es of W e a v e r s — P a y m e n t of W a g e s —C onstruction of
S t a t u t e — Gallagher v. Hathaway Manufacturing Co., 51 Northeastern

Reporter, page 1086.—Action was brought for wages by Jane Gallagher
against the above-named company. The suit was heard in the superior
court of Bristol County, Mass., and a judgment was rendered for the
defendant company. The plaintiff appealed the case to the supreme
judicial court of the State, which rendered its decision November 23,
1898, and sustained the judgment of the lower court. The evidence
showed that when the plaintiff went to work for the defendant, and
prior thereto, there was posted in a conspicuous place in the room in
which she was employed a notice specifying the wages to be paid for
weaving described styles of cloth of first quality, and the wages for
weaving the same styles of second quality, the quality to be deter­
mined by defendant’s superintendent, which notice stated, with the
detail required by law, the different kinds of cloth to be woven, and
the different rates of compensation to be paid therefor ; that it was the
manufacturer’s custom to pay wages as for first quality work, and, if
any of it was found to be of second quality, to deduct the difference
from the succeeding week’s wages, of which custom the plaintiff was
aware 5 that the plaintiff wove a cut of cloth of the second quality and
which was determined to be so by the superintendent; that the differ­
ence in pay was deducted from her next week’s wages, and that she
brought this suit to recover the amount so deducted. The case was
decided by the interpretation of the court of sections 51 and 55 of
chapter 508, acts of 1894, which, in so far as they affect this case, read
as follows :
Section 51. Every manufacturing, mining or quarrying, mercan­
tile, railroad, street railway, telegraph and telephone corporation, every
incorporated express company and water company shall pay weekly
each employee engaged in its business the wages earned by such
employee to within six days of the date of said payment; # # #
but if at any time of payment any employee shall be absent from his
regular place of labor he shall be paid thereafter on demand. * * *
Se c . 55. The system of grading their work now or at any time here­

after used by manufacturers shall in no way affect or lessen the wages
of a weaver, except for imperfections in his own work; and in no case
9986—No. 21----- 12



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BULLETIN OF THE DEPARTMENT OF LABOR.

shall the wages of those engaged in weaving be affected by fines or
otherwise, unless the imperfections complained of are first exhibited
and pointed out to the person or persons whose wages are to be
affected; and no fine or fines shall be imposed upon any person for
imperfect weaving, unless the provisions of this section are first com­
plied with and the amount of the fines are agreed upon by both parties.
The opinion of the supreme court was delivered by Justice Holmes,
and from it the following is taken:
In this case, since it was before the court upon an agreed statement
of facts (169 Mass., 578; 48 N. E., 844), there has been a trial, and the
judge has found that the plaintiff contracted to work for the defendant
upon the terms of a written notice by which the plaintiff was to be paid
a certain sum for weaving a described “ cut” of cloth of the first
quality, and half the amount for a cut of the second quality; the quality
to be determined by the defendant’s superintendent. The plaintiff
wove a cut which was of the second quality, and which was determined
to be so by the superintendent. The difference in the pay was deducted
from her next week’s wages, and she brings this suit to recover the
amount. The judge who tried the case found for the defendant, sub­
ject to the facts stated by him, and the plaintiff excepted and appealed.
Both parties intended to produce only work of the first quality, and
it is found that the difference of amount in the stipulated payments
was a fine. It is found that this difference was commonly known as a
“ fine,” and that the plaintiff understood the agreement, although she
did not know what defects would constitute second quality work; and
therefore we feel bound to assume, against a part of the argument for
the plaintiff, that her contract was an agreement upon the amount of
the fine, within St. 1894, c. 508, sec. 55, subject only to the question
whether the amount was fixed definitely enough to satisfy the act.
It is suggested, but is not much pressed, that the agreement covers
cases where the cloth is of second quality because of the poor quality
of the yarn, or other cause not an imperfection in the weavers own
work, to which last fines are limited by the section cited. But we
think that the agreement must be construed with the law, and taken
to refer only to a difference of quality for which the plaintiff was
responsible.
The more serious objection is that the standard of first and second
quality might not be constant, and that it is determined by the market,
and that the result is the same to the weaver whether the fine is left
in terms to vary, or is kept nominally the same, but is imposed by a
measure which varies from time to time. It is a well known device of
dealers, who do not want to say they change the price of a liquid, to
change the size of the receptacle, while keeping the old name of
“ quart,” “ pint,” or “ glass.” But it is not argued that the superin­
tendent may determine the quality arbitrarily. Both sides agree that
his determination must be reasonable. The plaintiff puts this part of
her case upon the oscillations of the market—the changes in grading
which may be necessary in order to get customers. Taking the argu­
ment as thus limited, we can not say that the agreement is not reason­
ably certain. The very section relied on seems to contemplate a fine
as determined by “ the system of grading their work # # # used
by manufacturers.” No mode of determination can give a changeless
result. All things change,—the dollars as well as others. If we
accept the principle of the plaintiff’s argument, it is still a question of
degree whether the certainty is sufficient. We should suppose, and,



DECISIONS OF COURTS AFFECTING LABOR.

347

so far as anything goes which is disclosed, we must assume, on the
finding for the defendant, that the difference between the first and sec­
ond quality of a given kind of cloth in a given market would be a
tolerably permanent as well as certain criterion. Whether the plain­
tiff knew in what the difference consisted is immaterial, so long as the
superintendent, in judging, was bound to refer to external standards,
and could not decide by his own whim. It is not argued that the fine
must be agreed on separately in each particular case. The language
of the statute implies, in accordance with good sense, that the agree
ment should precede the imposition of the fine. If so, it naturally
would be a general agreement in advance.
At the end of the week when the work in question was done, the
plaintiff received full pay as for first-class work, and the sum in ques­
tion was deducted from the next week’s wages. This was due to the
impossibility of the superintendent’s personally examining all the work
during the week, and was in accordance with the previous practice
between the plaintiff and the defendant. The court found that the
plaintiff, by implication, agreed that the first payment was provisional,
and that such overpayment as this might be withheld the next week.
It is urged that, if the plaintiff could make such an agreement, at least
it should have been expressed. The agreement found by the court is
express, none the less that it was expressed by conduct, and not by
words. It was not implied in the sense that it was a legal fiction, such
as often has been set up in order to bring a cause of action within the
spnere of assumpsit or debt. Apart from statute, it does not matter
what mode of expression is used, and there is no statute about it.
It is argued also that such an agreement, however made, is contrary
to St. 1894, c. 508, sec. 51, requiring manufacturing corporations, and
some others, 46 to pay weekly each employee engaged in its business
the wages earned by such employee to within six days of the date of
such payment.” We do not perceive how. The plaintiff has been paid
all that is due to her. She was overpaid one week, and was bound to
repay the amount. We see nothing to prevent her agreeing that such
an overpayment should go into a mutual account for the next week,
and reduce the sum due. It surely would not encounter either the
words or spirit of the law if an employer should lend his workman
money to be set against his next week’s wages. If the fine was lawful,
as we have decided that it was, the payment of it might be arranged
for in the same way.

Intimidation of Employees to Prevent them from Continu­
Lawful W ork and E mployment—Fischer v. State,
76 Northwestern Reporter, page 594.—One Otto Fischer was convicted in
the municipal court of Waukesha County, Wis., of attempting, by
intimidation, threats, etc., to hinder or prevent workmen from continu­
ing in their lawful employment. He carried the case to the supreme
court of the State upon a writ of error, and said court rendered its
decision October 11,1898, and affirmed the judgment of the lower court.
The facts are sufficiently shown in the opinion of the court, delivered
by Chief Justice Cassoday, from which the following is quoted:
The plaintiff in error has been convicted of having, on February 23,
1898, committed the offense described by the statute, which declares
ing their




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BULLETIN OF THE DEPARTMENT OF LABOR.

that “ any person who by threats, intimidation, force, or coercion of any
kind shall hinder or prevent any other person from engaging in or con­
tinuing in any lawful work or employment either for himself or as a
wage worker, or who shall attempt to so hinder or prevent, shall be
punished,” etc. Rev. St. 1898, sec. 4466c [Annotated Statutes, 1889,
sec. 4466c].
Counsel contend that the complaint fails to state facts sufficient to
constitute a cause of action. Of course, the complaint must state the
facts essential to charge the accused with the offense prescribed. This
should be done “ in plain, concise language without prolixity or unnec­
essary repetition.” (Rev. St. secs. 4650, 4657-4659; Hintz v. State, 58
Wis.,*493; 17 N. W., 639.) A t common law it seemed to be sufficient
to frame the indictment in the words of the statute in all cases where
the statute so far individuated the offense that the offender had proper
notice, from the mere adoption of the statutory terms, as to what the
offense he was to be held for really was; but not otherwise. Our statute
makes a charge in the language of the statute of an offense created or
punishable by statute sufficient after verdict. (Rev. St. sec. 4669.)
That statute, however, is not applicable here, since the objection was
taken before any evidence was admitted. Nevertheless we are con­
strained to hold that the complaint is sufficient. It alleges, in effect,
that at the time mentioned the plaintiff in error, at the city of Waukesha,
in the municipal district, being then and there the business agent of the
Building Trades Council of Milwaukee, a labor organization commonly
called a “ union,” and acting as the agent of such trades council, for the
purpose of preventing E. J. Affolter, John Kleigel, and Ed. Welsh, and
divers other persons, then and there being nonunion men, and not con­
nected with the Building Trades Council, or any other labor organiza­
tion, from continuing in the lawful employment in which they were then
and there engaged, so that their places be taken, and the work per­
formed, by the so-called “ union men,” did then and there, by threats,
intimidation, force, and coercion, willfully attempt to hinder and prevent
said Affolter, Kleigel, and Welsh, and divers other persons, from engag­
ing in and continuing in their lawful work and employment, to wit,
working as carpenters for the firm of George Mindemand &> Co. in and
upon the erection and construction of a certain building described, in
Waukesha; that the attempt to so hinder and prevent Affolter, Kleigel,
and Welsh from so engaging in and continuing in their lawful work and
employment by threats, intimidation, force, and coercion consisted in
this, to w it: “ That said Otto Fischer did then and there, in the presence
of the said E. J. Affolter, John Kleigel, and Ed. Welsh, to, of, and con­
cerning them, say: 6You (meaning the aforesaid E. J. Affolter, John
Kleigel, and Ed. Welsh) can not build this building (meaning the build­
ing described as aforesaid). I will fight it if it takes all summer; and
if your city will not protect us we will get the militia/—contrary to the
statute in such case made and provided, and against the peace and
dignity of the State of Wisconsin,”—and prays ,that the said Otto
Fischer may be arrested, and dealt with according to law. This lan­
guage seems to be sufficient to authorize a finding that the accused did,
“ by threats, intimidation, force, or coercion,” attempt to hinder or pre­
vent the persons named and others from engaging or continuing in the
lawful work or employment mentioned. The case is stronger than
State v. Compton, 77 Wis., 460; 4 N. W., 535, cited by counsel. In that
case the threat was sent by letter. Here the accused was present, and
professed to speak as the authorized agent of a large organization.
The judgment of the municipal court for the eastern district of Wau­
kesha County is affirmed.



DECISIONS OP COURTS AFFECTING LABOR.

349

Liability of E ailroad Company for Malpractice of Physi­
Employed in its H ospital Department—A ccident Con­
tracts— Wabash Railroad Go. v. Kelley, 52 Northeastern Reporter, page
152.—In an action brought by F. M. Kelley against the above-named
railroad company to recover damages for injuries received while in its
employ, and also for malpractice of a physician employed in its “ hospital
department/7 and heard in the circuit court of Dekalb County, Ind., a
judgment was rendered for him for the malpractice and for the defend­
ant company as to the original injuries caused by an accident on its
line. The railroad company appealed the case to the supreme court of
the State, which rendered its decision December 15, 1898, and affirmed
the judgment of the lower court. The evidence showed that the plaintiff,
Kelley, was a fireman employed on one of the company’s freight engines;
that while engaged in his duties cleaning his engine he slipped and fell
from a defective step on the engine and the wheels ran over and crushed
one of his feet; that the company had a system whereby it deducted
certain amounts from the wages of its employees and agreed therefor
to furnish them with medical attendance and treatment in case of
injuries from accident; that as part of this plan it had established a
hospital department and employed surgeons; that the plaintiff was
taken to a hospital and treated by said surgeons; that several amputa­
tions were performed on his leg; that the second of these was wrongly
performed by a Dr. Higgins, one of the company’s surgeons, and that
the said doctor was afterwards discharged by the company on the
ground of his indulgence in drugs.
The opinion of the supreme court was delivered by Judge Howard,
and the following is quoted therefrom:
cian

The sufficiency of the complaint is questioned under various assign­
ments of error. The defect indicated is that it appears from the com­
plaint that the company exacted from appellee [Kelley], without his
written consent given, a part of his wages, to be used for the mainte­
nance of a hospital, contrary to the provisions of sections 2350, 2301,
Eev. St., 1894.
Said sections are as follows:
u Section 2300. It shall be unlawful for any railroad company or
corporation operating railroads in Indiana to exact from its employees,
without first obtaining written consent thereto in each and every
instance, any portion of their wages for the maintenance of any hospital,
reading-room, library, gymnasium or restaurant.
“ Sec . 2301. Any paymaster, auditor or employee of any company so
exacting from its employees such sums of money shall, upon conviction
thereof in any circuit court having competent jurisdiction, be fined not
less than one hundred dollars nor more than five hundred dollars, as
the court may decree.”
Appellant has retained appellee’s money, and has placed the same in
its treasury as a part of its funds for the care of its sick and disabled
employees; but contends that, as appellee did not give his written con­
sent to such retention, he has, therefore, by reason of appellant’s said
wrongdoing, no right to the benefit which appellant promised him in
return for the money so exacted. We do not think the complaint shows



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BULLETIN OF THE DEPARTMENT OF LABOR.

any agreement on the part of appellee to violate the statute in question.
It is alleged, simply, that the appellant had undertaken, as a part of
the contract of employment, to provide surgical and medical attendance
and care to the appellee, as the same should be rendered necessary by
casualty and accident, and to treat him for injuries received while in its
service; that, consequently, on the happening of appellee’s injury,
appellant was in duty bound to furnish him such medical and surgical
services; and that appellant, recognizing its said duty, did send
appellee first to the Emergency Hospital at Detroit, and then to the
hospital at Peru, to receive the care and attention originally promised.
Such undertaking to provide surgical and medical care is not, by the
statute [sections 2300 and 2301, above], made void as a part of the con­
tract of service. The provision of the statute is that it shall be unlaw­
ful for a railroad company u to exact from its employees, without first
obtaining written consent thereto in each and every instance, any por­
tion of their wages for the maintenance of any hospital, reading room,
library, gymnasium or restaurant.” If the appellant did, indeed, exact
any such contributions without the written consent of appellee,—which
does not appear from the complaint,—that was not a wrong for which
appellee can be held liable. It was the act of appellant; and it is a
familiar principle that one can not take advantage of his own wrong.
As to the deductions from appellee’s wages, it appears from the com­
plaint that appellee had no voice in the matter, but that appellant had
u for seven years, the period of appellee’s service, deducted and taken
from his monthly wages the sum of 50 cts. per month, with which to
reimburse and recompense itself for expenses and charges incurred or
rendered necessary in treating or providing surgical and medical treat­
ment for plain tiff.” It would be strange, indeed, if appellant, while
retaining this money, could now claim that appellee had no right to the
promised benefit from the money so retained, for the reason only that
appellant had no right to so retain it. Even if such unlawful retaining
by appellant could, in any way, be considered as a contractor! the part
of appellee, still, as said in 9 Am. & Eng. Enc. Law, 910, u an innocent
party, defrauded by a guilty one, may have redress as to him.” The
law is aimed at the wrongdoer. So it was said in Stock well v. State,
101 Ind., 1 : “ The general rule is that contracts in violation of law are
void, but this rule will not be extended and applied to a case like this,
so as to enable the wrongdoer to take advantage of his own wrong
against an innocent party.” It is not shown here, either in the com­
plaint or by the evidence, that the appellee was guilty of any violation
of the statute in suffering a part of his wages to be retained by the
appellant.
The first reason given to show that the court erred in overruling the
motion for a new trial is substantially the same as that urged against
the sufficiency of the complaint; that is, that, under the statute above
cited, appellant had no right, without appellee’s written consent, to
make deductions from his wages, in order to reimburse itself for care
given or to be given to him in case of sickness or accident. We think
we have shown this reasoning to be unsound. Appellant may not thus
visit its own wrong upon the head of appellee. Appellee’s evidence
showed that he worked for the company seven years; that he was hired
by one Sternberg, who employed and discharged men, and directed
them in their work; that when the first pay car came along, Sternberg
explained the matter of deducting monthly amounts from his wages,
saying: “ The company’s surgeons and physicians would treat me, and
all my nursing would be done, and that they had trained nurses, and that
they could take care of the men better at the hospital than any man



DECISIONS OE COURTS AFFECTING LABOR.

351

Could be taken care of at borne. I told him I never bad been sick
any, and I would rather not pay the hospital fee, and run my own
chances, and take care of myself. He said, if I worked for the com­
pany I would have to pay it. If I didn’ t want to pay it, I would have
to quit working for the company. # # # I didn’t make any kick
about it after that, and it was always taken out of my wages.” To
the same effect was the company’s book of rules, which was introduced
in evidence. The first rule set out in the book of rules is as follows:
u(l) In order to provide a fund for the support of a hospital and the
care of the sick and injured employees, a deduction will be made on
the pay rolls from the pay of each employee, as follows: Where the
pay of an employee amounts to $50 or more per month, a deduction of
50 cts. will be made; where the pay of an employee amounts to less
than $50 per month a deduction of 35 cts, will be made. The above
deductions will be made in all cases where the employee is in continu­
ous service, or has worked as many as fifteen days in such month.”
We do not think anything further is needed to show that appellant
had assumed an obligation to care for its injured employee, and that it
can not now thrust that obligation aside under the plea that it had no
right, under the statute, to take from the employee, without his writ­
ten consent, a part of his wages, monthly, during his seven years’
service. If the company should feel that by reason of the violated
statute it could not conscientiously carry out its promise to care for
the appellee, then it ought, at least, in compliance with the dictates
of the same good conscience, return, with interest, the money which it
had so persistently retained from his wages.
Here the court considers certain evidence heard on the trial and con­
cludes that it was sufficient to warrant the jury in deciding, as they
did, that Dr. Higgins was guilty of malpractice and that the company,
through Dr. Morehouse, its chief surgeon, was negligent in failing to
remove Dr. Higgins after learning of his habits and consequent ineffi­
ciency, and then continues as follows:
Counsel finally contend that, even if malpractice on the part of Dr.
Higgins and failure on the part of Dr. Morehouse to remove him after
learning of his inefficiency are shown by the evidence, yet appellant is
not liable, for the reason that it is shown that the hospital system is
managed by a board of trustees, consisting of “ the vice president, the
general manager, and the assistant secretary of the Wabash Eailroad
Company,” all general officers of the road, and members of the execu­
tive department; and also because the funds for the support of such
hospital system are made up of deductions from the wages of the
employees of the company, which funds, it is said, are confided to the
management of said trustees. We think that, even from what has
already appeared from the record, a much closer relation is shown
between the company and its hospital system than counsel would have
us understand. From the moment the employee begins work until his
treatment in the hospital on account of sickness or accident, the hos­
pital department, as we think, is shown to be as closely connected with
the administration and management of the road as any other depart­
ment of the company’s business. Everything is superintended and
directed by the company, the hospital officers acting and reporting
precisely as officers of other divisions of the company’s affairs.
The evidence, all considered, shows clearly that the property of the
medical department, quite the same as the property of any other depart­
ment of the road, is wholly under the control and management of the



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BULLETIN OF THE DEPARTMENT OF LABOR.

company; and that, although the funds for its support are drawn from
the wages of the employees, they are but nominally in the hands of the
trustees named, and are so held by them merely for the convenience
and advantage of the company. So far as the trustees act in relation
to such property, they act as officials of the company. The company
undertook to care for its disabled employees out of moneys derived from
their own monthly wages, and the plan devised for the hospital depart­
ment has been contrived as the means of carrying out that undertaking.
Whatever defects may be found in the plan adopted, or in the manner
in which it has been conducted, it appears, on the whole, to be a wise
and praiseworthy undertaking. It would, however, be a great wrong
to hold that the obligation to comply with the duty so assumed by the
company could be lightly thrust aside by laying it upon the shoulders
of the officials who, under the direction of the company, are placed in
charge of the several hospitals and relief system established by the
company itself. Here, as in Railway Co. v. Sullivan, 141 Ind., 83; 40
N. E., 138, the appellant company, having undertaken to provide its
injured and sick employees with medical and surgical assistance, was
bound to exercise reasonable diligence in the selection and retention of
its physicians and other attendants. This reasonable diligence included,
of course, the duty to supervise the work of its hospitals, and to dis­
charge any appointees who, although reasonably competent at the time
of their appointment, had, on account of the use of intoxicants and nar­
cotics, or for other causes, since become incompetent. This was par­
ticularly the case where the incompetency of the surgeon in chief had
become notorious in the community, so that the appellants supervising
officials must have, or at least ought to have, known it. Having found
no available error in the record, the judgment is affirmed.

Mining Statute—Negligence of Employer—Sommer v. Car­
bon Hill Coal Co., 89 Federal Reporter, page 54.—Suit was brought by
one Sommer against the above-named coal company in the United
States circuit court for the western division of the district of W ashin gton to recover damages for personal injuries sustained by the plain­
tiff while in the employ of the coal company. The plaintiff’s complaint
stated, in brief, that he was injured by an explosion of gas in the mine
caused by the lighting of a match by him for the purpose of lighting a
fuse to set off a charge of giant powder in pursuance of his duty as a
coal miner; that he had previously noticed the accumulation of gas
and had notified one John Lowery, employed by the coal company as a
fire boss, whose duty it was to see that the mine was properly ventilated
and kept free from all accumulations of gas, etc.; that after a time the
plaintiff, supposing that Lowery had performed his duty, returned to
the working place and proceeded to light the fuse, but that Lowery
had not performed his duty, and as a consequence of his negligence in
that regard the plaintiff was injured as above stated; also that Lowery
was a vice-principal of the coal company and not a fellow-servant of the
plaintiff, and that the company, therefore, was liable for his negligence.
The defendant company demurred to this complaint and said demurrer
was sustained by the circuit court. The plaintiff then carried the case,



DECISIONS OF COURTS AFFECTING LABOR.

353

upon a writ of error, before the United States circuit court of appeals
for the ninth circuit, which rendered its decision May 20, 1898, and
reversed the decision of the circuit court.
From the opinion of the court of appeals, delivered by Circuit Judge
Morrow, the following is quoted:
Counsel for plaintiff in error contends that the complaint as amended
states a cause of action, in that it shows as claimed, that the plaintiff
in error was injured by and through the negligence of the defendant
company, through its vice-principal, John Lowery, in not having pro­
vided and maintained the proper circulation of air to the working place
of the plaintiff in error, so that the same would be free from gas, as
required by law. Counsel for the defendant in error contends that the
averments of the complaint as amended show two things: First, that
Lowery was a fellow-servant, and not a vice-principal, of the plaintiff
in error; * * *
The act of the legislature of the State of Washington, approved
March 5, 1891, entitled “ An act relating to the proper ventilation and
safety of coal mines, and prescribing the manner of appointment of
inspectors” [chap. 81, Laws of 1891], provides in detail for the safety
of persons employed in the coal mines of the State, and requires,
among other things, that the owner, agent, or operator of every coal
mine, whether operated by shaft, slope, or drifts, shall provide and
maintain in every coal mine a good and sufficient amount of ventilation
for such persons as may be employed therein. The act prescribes the
minimum amount of air that shall be in circulation, and for its increase
at the discretion of the inspector, according to the character and extent
of the workings or the amount of powder used in blasting, and pro­
vides that the volume of air so prescribed shall be forced and circu­
lated to the face of every working place throughout the mine, “ so that
said mine shall be free from standing powder, smoke, and gases of
every kind.” The purpose of this statute is directed specifically to
secure the proper ventilation of coal mines for the protection and
safety of workmen who might otherwise be injured by the explosion of
accumulated gases. It is a matter of common knowledge that coal
mining is an exceedingly dangerous employment, by reason of the pres­
ence of explosive gases given off by the coal, and that the most
important branch of colliery work is the management of the ventila­
tion for the purpose of supplying fresh air to the workmen, and for the
removal of the dangerous gases from the working places in the mine.
In many States, where such mining is carried on extensively, elaborate
systems have been provided by law for the protection of the miners,
requiring official inspection of the mines and their proper ventilation
and means for the escape of the miners in case of accident. In this
respect, such a law is, in effect, the measure of that reasonable care
which the owner or operator of a coal mine is required to take to avoid
responsibility for injuries to workmen arising from accidents of this
character. The general duty imposed by law upon the master is to
provide a suitable and reasonably safe place for the doing of the work
to be performed by the servant. What is a reasonably safe place is
generally governed by the circumstances of each particular case; but
here the law, having regard to the hazardous nature of the employ­
ment, has undertaken to provide adequate protection by imposing upon
the master a specific duty, which he must perform to escape the charge
of negligence. It is a duty the object of which is to secure a reason­
ably safe place for the workmen in the mine, and is a positive duty,



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BULLETIN OF THE DEPARTMENT OF LABOR.

which can not be delegated to a servant so as to exempt the master
from liability from injuries caused to another servant by its omission.
It is alleged in the complaint that the defendant, in accordance with
the law to which reference has been made, had in its employ one John
Lowery on the 22d day of June, 1896, for the purpose of providing the
said mine with air, and overseeing and conducting, guiding, and man­
aging the ventilation of the said mine for the proper escape, and in free­
ing the said mine from all gases and smoke of every kind, for the safety
of the employees of the said defendant; that the said John Lowery was
a vice-principal of the defendant, and known as a fire boss, and not a
fellow-servant. Disregarding this last averment as a conclusion drawn
from the facts stated, it is clear that, under the law and the allegations
o f the complaint, Lowery was intrusted with a duty in the performance
o f which he represented the owners and operators of the mine, and that
if he was negligent in the performance of that duty, and the plaintiff
was injured thereby, the latter did not assume the risk of such employ­
ment.

Sunday Labor—Barbers—State v. Petit, 77 Northwestern Reporter,
page 225.—Paul J. Petit was tried and convicted in the municipal court
o f Minneapolis, Minn., for a violation of the provisions of section 6513
o f the General Statutes of 1891 prohibiting the keeping open of barber
shops on Sunday. He appealed the case to the supreme court of the
State, which rendered its decision December 2,1898, and affirmed the
judgment of the lower court. The section of the statute above referred
to reads as follows:
Section 6513. All labor on Sunday is prohibited, excepting the
works of necessity or charity. In works of necessity or charity is
included whatever is needful during the day for good order, health or
comfort of the community: Provided, however, That keeping open a
barber shop on Sunday for the purpose of cutting hair and shaving
beards shall not be deemed a work of necessity or charity.
The opinion of the supreme court was delivered by Judge Mitchell,
and the following is quoted therefrom:
The only question is as to the constitutionality of this act, which is
assailed by the defendant on two grounds: (1) That the whole act is
invalid, it not being within the police power of the State to prohibit any
kind of labor or business on Sunday which does not interfere with the
peace and good order of the community; (2) and mainly that, in view
o f the proviso, the act is invalid, as being “ class legislation”.
1.
We shall not spend much time on the first point. It has been
decided in this State, in accordance with an almost unbroken line of
authorities elsewhere, that the legislature may, in the exercise of the
police power of the State, establish by law, as a civil and political
institution, the first day of the week as a day of rest, and may prohibit
upon it the performance of any manner of labor, business, or work,
except only works of necessity or charity. So-called Sunday legisla­
tion has, with many persons, and occasionally even with courts, been
the subject of adverse criticism, as an unwarranted interference with
that freedom of religious belief and practice which is guaranteed to
every man by the constitution. These criticisms proceed upon an
entirely erroneous theory as to the object of such legislation. In



DECISIONS OF COURTS AFFECTING LABOR.

355

some States it lias been held that Christianity is part of the common
law of this country, and Sunday legislation is upheld, in whole or in
part, upon that ground. Even if permissible, it is not necessary to
resort to any such reason to sustain such legislation. The ground
ujion which such legislation is generally upheld is that it is a sanitary
measure, and as such a legitimate exercise of the police power. It
proceeds upon the theory, entertained by most of those who have
investigated the subject, that the physical, intellectual, and moral wel­
fare of mankind requires a periodical day of rest from labor, and, as
some particular day must be fixed, the one most naturally selected is
that which is regarded as sacred by the greatest number of citizens,
and which by custom is generally devoted to religious worship, or rest
and recreation, as this causes the least interference with business or
existing customs. It is sometimes said that mankind will seek cessa­
tion of labor at proper times by the natural influences of the law of
self-preservation; also that, if a man desires to engage on Sunday in
any kind of work or business which does not interfere with the rights
of others, he has an absolute right to do so, and to choose his own time
of rest, as he sees fit. The answer to this is that all men are not in
fact independent and at liberty to work when they choose. Labor is
in a great degree dependent upon capital, and, unless the exercise of
power which capital affords is restrained, those who are obliged to
labor will not possess the freedom for rest which they would otherwise
exercise. The object of the law is not so much to protect those who
can rest at pleasure, but to afford rest to those who need it, and who,
from the conditions of society, could not otherwise obtain it. More­
over, if the law was not obligatory upon all, and those who desired to
do so were permitted to engage in their usual avocation on Sunday,
others engaged in the same kind of labor or business might, against
their wishes, be compelled, by the laws of competition in business, to
do likewise.
2.
The enacting clause of the statute under which defendant was
convicted was passed in 1885, being section 225 of the Penal Code.
The proviso was added in 1887. (Laws of 1887, c. 54.) If keeping a
barber shop open on Sunday for the purposes of shaving and hair
cutting was not a work of necessity or charity, within the meaning of
the original statute, the amendment has not changed the law, and the
statute, as it now stands, is not open to the objection of being class
legislation. Under the original statute, what were works of necessity
or charity was largely left to be decided as a question of fact, which
would often be a question for the jury. The effect of the amendment
was to make this a question of law, instead of fact, as to keeping a
barber shop open. In the exercise of the police power in establishing
a day of rest, a very large discretion must be allowed to the legislature
in determining what kinds of labor or business should be prohibited,
and what are and what are not works of necessity or charity; and
unless their classification is manifestly purely arbitrary, and not founded
upon any substantial distinction or apparent natural reason which sug­
gests the necessity or propriety of different legislation, the courts have
no right to interfere with the exercise of legislative discretion. Courts
will take judicial notice of the fact that, in view of the custom to keep
barber shops open in the evening as well as in the day, the employees
in them work more, and during later hours than those engaged in most
other occupations, and that this is especially true on Saturday after­
noons and evenings; also that, owing to the habit of so many men to
postpone getting shaved until Sunday if such shops were to be per­



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BULLETIN OF THE DEPARTMENT OF LABOR.

mitted to be kept open on Sunday, the employees would ordinarily be
deprived of rest during half of that day. In view of all these facts,
we can not say that the legislature has exceeded the limits of its legis­
lative police power in declaring that, as a matter of law, keeping bar­
ber shops open on Sunday is not a work of necessity or charity, while
as to all other kinds of labor they have left that question to be deter­
mined as one of fact. It will be noted that what the law forbids is,
not a man’s shaving himself, or even getting someone else to shave
him, but the keeping open of a barber shop for that purpose on Sun­
day. The object of the law was not to interfere with those who wish
to be shaved on Sunday, or primarily to protect the proprietors of bar­
ber shops, but mainly to protect the employees in them, by insuring
them a day of rest. We are of opinion that the whole act, including
the proviso, is valid. Judgment affirmed.
DECISIONS UNDER COMMON LAW.
"Employers’ Liability —A ssumption of Risk by Employee—
Began v. Palo, 41 Atlantic Reporter, page 364.—Dominico Palo brought
suit in the circuit court of Essex County, N. J., against Thomas J. Regan
to recover damages for personal injuries incurred while in Regan’s
employ. He was engaged in excavating for a sewer when one side of
the excavation caved in and injured him. He had been working in the
excavation for a day or more before the accident happened and was
acquainted with the character of the soil through which the excavation
was made. A judgment was rendered in his favor, and the defendant,
Regan, brought the case, on writ of error, before the supreme court of
the State, which rendered its decision October 18, 1898, and reversed
the judgment of the lower court on the ground that under the cir­
cumstances of the case the plaintiff had assumed the risks of his
employment and that the defendant, his employer, was not responsible
therefor.
The opinion of the court was delivered by Judge Lippincott, and from
the syllabus of the same, which was prepared by the court, the follow­
ing is quoted:
1. In the relation of master and servant, whatever may be the negli­
gence of the master to exercise reasonable care to provide a safe place
for his servant to perform his work in, or to provide safe appliances for
him to do work with, still when the risks of danger arising are inci­
dental to the employment, and obvious to the servant, or discoverable
by the exercise of ordinary care on the part of the servant, the neglect
o f the master can not be made the basis of an action for damages for
injuries caused by such risks. In law they are assumed by the servant
when he enters and continues in the employment.
2. When the danger is latent and concealed, and the facts are such
that the master did not have any knowledge of it, and the facts are not
such that the master, in the exercise of reasonable care, should have
known o f it, or should have been put upon an inquiry to ascertain the
danger, the servant can not recover for injuries arising from such danger.
When the servant and master have a like knowledge and appreciation




DECISIONS OF COURTS AFFECTING LABOR.

357

of the danger existing in the employment, there can be no recovery of
damages by the servant for injuries arising therefrom.
3.
Where a workman digging a deep trench for a sewer, through soil
the character of which he can observe, with full knowledge of the nature
of his employment, and the manner in which it is being conducted, he
can not recover for injuries arising irom dangers which were obvious
to him, or which he could observe or discover in the exercise of ordinary
care. He must show some facts from which the jury can infer or con­
clude that there was latent or concealed danger, of which the master
had knowledge, or should have had knowledge, and from which latent
or concealed danger the master failed to exercise reasonable precautions
to protect him in his employment.

E

m ployers’

L ia b il it y — A

s s u m p t io n

of

R is k

by

Em

ployee—

Trotter v. Chattanooga Furniture Co., 47 Southwestern Reporter, page
425.—Suit was brought by John Trotter against the above-named com­
pany in the circuit court of Hamilton County, Tenn., to recover dam­
ages for personal injuries sustained by him while m the employ of the
said company, and due, as alleged, to its negligence. The evidence
showed that about ten days before the accident happened a rope
attached to the saw frame, operated by Trotter, broke; that he imme­
diately reported the fact to one Lockwood, the repairer of the company’s
machinery; that Lockwood tied the rope together and then went to one
Parham, the general manager, and told him he wanted a new rope;
that Parham said he would bring one the next morning, and Lockwood
told the plaintiff that the mended rope would last all right till the next
morning and to go on with the work; that the new rope was not brought
the next morning, and the plaintiff continued to operate the saw with
the old rope as it was for some ten days without further complaint,
when it again broke and the saw flew out and struck the plaintiff’s arm
and injured his elbow. Upon this state of facts the trial judge refused
to submit the case to the jury and rendered judgment for the defendant
company. The plaintiff then appealed the case to the supreme court of
the State, which rendered its decision October 1,1898, and affirmed the
judgment of the lower court. In the course of the opinion of the court,
Judge Wilkes, who delivered it, used the following language:
The general rule is that the servant assumes the risks when he enters
or continues in employment when he knows the tools or machinery are
dangerous, unfit, and unsuitable, but nevertheless works with them,
and is injured. In order to recover in such cases, he must show knowl­
edge or negligent ignorance on the part of the master, and a want of
knowledge or excusable ignorance on the part of the servant. And,
when each is equally competent to judge of the risks and hazards, there
is no ground of recovery.
This case must, however, turn largely upon the effect of the promise
to repair. The averment is that the promise was to repair immediately,
and that a new rope would be furnished the next morning. The aver­
ment is not that the plaintiff was led to continue in the employment by




358

BULLETIN OF THE DEPARTMENT OF LABOR.

the promise, but is only that he believed the repair would be made, and
relied on the master’s promise. u It must appear that the servant was
led to continue the employment by the master’s promise that the defect
complained of would be removed.” (Bailey, Mast. Liab., p. 208;
Brewer v. Bailway Co., 97 Tenn., 615, 619; 37 S. W., 549.) The assur­
ance of the master that the defect shall be remedied is an agreement by
him that he will assume the risk for a reasonable time. This promise
will be implied to continue only a reasonable time, and the injury must
have occurred within the time within which the defects were promised
to be removed. If the employee continues longer than this, he does
so without reliance on the promise, and is as hazardous and hopeless of
remedy as though the promise had not been made. It is a waiver of
the defects agreed to be remedied.
In this case the appliance was of the simplest nature. The danger
was obvious, and better known to plaintiff than perhaps anyone else.
He continued to use the broken rope without complaint. He made no
demand to have the defect remedied after the failure to furnish the new
rope next morning. He continued to operate the saw for ten days.
In the meantime the repairer, Lockwood, had left the employ of the
company; and plaintiff made no complaint to his successor,but must be
held to have taken the risk, and not to be relying on the defendant’s
promises.
We do not think it would have been proper in this case to have sub­
mitted to the jury the question as to what was reasonable time. The
promise fixed the time. Let the judgment be affirmed with costs.

E

m ployers’

L i a b i l i t y — In s p e c t io n

of

Car s— A

s s u m p t io n

of

Union Stock Yards Co. v. Goodwin, 77 North­
western Reporter, page 357.—In a suit brought by Edward Goodwin, as
plaintiff, against the above-named company to recover damages for
injuries received by him while in its employ, a judgment in his favor
was rendered by the district court of Douglas County, Nebr. The evi­
dence showed that Goodwin was a brakeman in the employ of the Stock
Yards Company; that on April 10,1895, he, with others, was ordered to
bring from the Burlington road or its terminus six cars of cattle, and
to set the cars out at the stock yards chute for the purpose of unload­
ing; that while in the discharge of his duties in switching out these
cars Goodwin climbed upon one of them and attempted to set the
brake; that the nut which should have held the wheel firmly to the
brake rod came off, the wheel following it, and Goodwin was thrown to
the ground and severely and permanently injured; that the car was
not the property of the Stock Yards Company, and that said company
had not caused it to be inspected before it took it into its possession
and ordered its employees to use it; that the nut did not part from the
brake rod because of its being worn out or because of any defect in
any part of the brake rod or in the nut itself, but because the nut was
too large for the brake rod and could be pushed down over the threads
on its end by the fingers; that Goodwin did not know pf this condition,
B

is k

by

E

m ployees—




DECISIONS OF COURTS AFFECTING LABOR.

359

and that lie could not have seen it by a mere look or casual glance at
the brake.
The defendant company carried the case on writ of error to the
supreme court of the State, which rendered its decision December 8,
1898, and affirmed the judgment of the lower court. The opinion of
the court was delivered by Justice Ragan, and from the syllabus of the
same, which was prepared by the court and which sufficiently shows
the important points decided, the following is quoted:
1. A person or corporation using the cars or appliances of another
person or corporation, as to its employees, uses such cars or appliances
charged with the same duty as to inspection as if they were his or its
own.
2. An employee who, under the instructions of his master, uses the
car or appliance in his master’s possession belonging to some other per­
son or corporation, thereby assumes only the same risk that he would
if the car or appliance belonged to his employer.
7. A brakeman who goes upon a car to set a brake thereof, knowing
that the car has not been inspected, does not for that reason assume
the risk of the brake being defective; he not knowing that the brake
is out of order, the defect not being obvious, and it not being his duty
to inspect cars or brakes, or to handle cars known or supposed to be
defective.
8. An employee assumes the risk arising from defective appliances
used or to be used by him, or from the manner in which a business in
which he is to take part is conducted, when such risks are known to
him, or are apparent and obvious to persons of his experience and
understanding.
9. No defect being obvious, an employee has the right to assume that
a tool or appliance furnished him by his employer is reasonably safe
and fit for the purpose for which he is required to use it.
10. To inspect a car brake may require more than a simple glance at
it. Such a test must be applied as would probably reveal a defect if
one existed; and the neglect of a car inspector to make such a test is
evidence of negligence.




RECENT GOVERNMENT CONTRACTS.
[The Secretaries of the Treasury, War, and Navy Departments have consented to
furnish statements of all contracts for constructions and repairs entered into by
them. These, as received, will appear from time to time in the Bulletin.]

The following contracts have been made by the office of the Super­
vising Architect of the Treasury:
K a n s a s C i t y , Mo.—March 9,1899.
Contract with Borger Bros. &
Co., Columbus, Ohio, for boiler plant, low pressure and exhaust steam
heating and mechanical ventilating apparatus, pumps and tanks for
water supply, etc., for post-office and court-house, $44,905.37. Work
to be completed within one hundred and forty working days.
E l l i s I s l a n d , N. Y.—March 14, 1899. Contract with R. H. Hood
Co., New York, N. Y., for construction of four towers above cornice
line of main building for immigrant station, $50,000. Work to be
completed by September 2, 1899.
360