Before Dollars Came


Lyman B. Jackes September 1 1912

Before Dollars Came


Lyman B. Jackes September 1 1912

Before Dollars Came


Lyman B. Jackes

An interesting chapter is contributed to the history of Canadian banking in this brief story of an attempt to wreck the Bank of Upper Canada at Toronto during the stormy days marking the rebellion of 1837. A daring stratagem was resorted to in meeting a run on the bank which was made by rebels, and the institution was saved. But the attempt was fraught with danger, and the situation was not without peril. The early struggle of the promoters for a charter, the manner in which they met this crisis, and the ultimate closing of the institution are covered in this sketch.

THE evening of June 18th, 1822 was exceedingly warm, so warm indeed that the group of men sitting around the goodly and generous table of D’Arcy Boulton at his hospitable Toronto home were fain to rest well back in the comfortable chairs and use their soft silk kerchiefs freely upon the face. By nine of the old clock in the corner, business was concluded and.all the gentlemen excepting Mr. William Allen and Thomas Ridout arose from their seats and sought relief from the oppressing humidity on the broad veranda of the Orange. Mr. William Allen had just been elected to the office of president of the newly formed Bank of Upper Canada and remained at the head of the table in order that he

might instruct Mr. Ridout, the cashier-elect, upon certain transactions

about to be entered and also to secure his opinion of the dimensions and safety devices of the strong room to be in the basement of the bank building, then almost completed and ready for occupancy.

Upon the veranda, Mr. Samuel Ridout was reviewing the history and struggle of the bank charter for the benefit of two directors, almost strangers to Canada.

“Mr. Cameron,” he remarked, “this is a great achievment for us. Here we are after many years and numerous attempts, with the Royal Charter of the Bank of Upper Canada in there on that table. It’s been a long time coming, sir, but here it is at last.”

To satisfy himself that he was not in a dream he withdrew his pipe from his mouth

and looked at the precious document through the open window. Sure enough there it was under the heavy paper weight, right before the president and the cashier. After once more satisfying himself that it wTas true he again turned to his companions and proceeded to recapitulate the bank history.

“Let me see,” he at length remarked, “This is the eighteenth of June, eighteen twenty-two: Well, this thing was started about fourteen years ago, away back in eighteen hundred and eight, just about four years previous to the war. It was then that the question of establishing a bank was first seriously considered.

“The governor at that time was Sir James Craig, and when the formal application was presented to the Legislature he persuaded them to vote against

the project, and the charter was refused on the grounds that the people were too ignorant to understand the different notes and guard against counterfeits.”

“And the speaker, when he had repeated the last remark, laughed so heartily that the attention of the other gentlemen was attracted to the three, and when Mr. Ridout was prepared to proceed he had an audience of fourteen persons who had been waiting some minutes for him to regain his composure and wipe the tears from his eyes.

“Yes sir,” he began again, “a people with sufficient intelligence and backbone to prevent the United States from merging us into their union by a force of arms, too ignorant to understand Ihe different denominations and guard against counterfeits.”

And when he had finished they all

saw the humor of the thing and joined the speaker in another hearty laugh.

“Well, then the war came,” continued the speaker, “and we had a Governor then.”

Many of the gentlemen saluted in honor of General Isaac Brock when Mr. Ridout made this reference to the i 11 us t ri ous com mander.

“And he understood the people and the people loved him. There was no arrogance about Sir Isaac Brock. I tell you gentlemen, never did a finer man come into this country. Well, when the war finally came the Governor issued the first lot of Army Bills and I wish old Sir James Craig could have witnessed the loyalty and understanding of Canadians when we exchanged our Mexican and United States currency for the Governor’s Army Bills. And I’ll tell you further, gentlemen, it was only through those same bills that Ilis Majesty, King George the Fourth, was made to see that the people of Canada, both Upper and Lower, were given possession of banks named after their respective provinces.”

Following this short discourse of Mr. Ridout’s an informal and general discussion was indulged in and the group gossiped about the glorious future that must surely attend the opening of the bank on Thursday morning of the next week.

In due time the bank was opened and the old premises stand in Toronto to this day with a big clumsy bronze sign on the door to prevent the fact becoming obliterate. The old vault is still in the basement with a rusty old door still displaying the two gigantic key holes that once were relied upon to defend the treasure from theft and despoliation. C u s t o m e r s came and customers went, and the stately building at the corner of King and Frederick Streets in the town of York was looked upon with importance almost equal to

that of the Government buildings.

In 1834 the town of York assumed the name of Toronto and the old bank was still doing business on the corner ; the next year brought great prosperity to the institution, and the year 1836 closed with a fine balance on hand.

But all was not destined to be continuous and uninterrupted progress for the new concern. While the year 1837 opened under favorable auspices, dark clouds gathered as it waned, and the latter part of it witnessed the most daring financial stratagem ever resorted to in the history of Canadian banking, if not in the history of banking anywhere.

The mail from Montreal, brought by the stage coach, of December 1st, 1837 was of momentous importance to the Bank of Upper Canada. There was very little of it, for banking and other business was partially crippled owing to the daring and open attitude of political agitators, but the first letter that Mr. Crompston, the bank manager, opened struck terror to his very being. The letter was written in a bold hand and read:—

Montreal, L.C., Nov. 24, 1837. Mr. J. L. Crompston,

Manager, Bank Upper Canada, Toronto, U.C.

Dear Sir :—

Banks in Quebec and Montreal have suspended specie payment owing to a run on the institutions following the recent harrangues of the insurrectionists. T am advised that the Bank of Upper Canada is to be the object of their next attack.

I trust that this warning will prove of effect in staying off a similar calamity for your establishment.

I Jiave the honor to be, Your humble servant, Hansit Garabue. Mr. Crompston moved towards the door after he had grasped the meaning of the

contents and steadied his trembling frame. His object in seeking the outer office was to despatch the messenger for the directors and hold an emergency meeting to frame a program of defence for the funds of the Bank. As he reached the partition which separated the public office from his own he saw that Mr. Ridout was engaged in conversation with Mr. Aldster and Mr. Fleming, two of the directors.

Stepping quickly to the group he wished the directors a good morning and requested Mr. Ridout to prepare a rough rep o r t on the amount of specie then in the strong room in the basement. Noting by the expression of the manager’s face that something was amiss the two directors, at the bidding of Mr. Crompston, followed him into the private office and placed their wraps arid hats on the great walnut rack at the end of the room.

“Gentlemen,” said the manager slowly, “I am afraid the bank of Upper Canada is insolvent.”

The effect of this statement on the directors was indescribable and they gazed at the bank manager in an abstract manner until he placed the letter before them for their perusal. When they had looked the missive over to their complete satisfaction they requested an explanation from Mr. Crompston who was holding his aching head between his trembling hands, his whole body bent over his desk.

A knock at the door and Mr. Ridout entered the room. He formed a strange

contrast to the other three with his tall, powerful body and military bearing as he placed the statement on the table before the manager. When he had left the room Mr. Crompston glanced at the statement and saw that the ready funds of the bank were made up thus:—

£ s. d. Notes - 4,356 18 0 Silver - - 129 4 0 Copper - - 14 9 8$


Mr. Fleming stepped to the door and requested a junior clerk to summon the balance of the directors to appear in the manager’s office at once. When he had started upon his errand, Mr. Ridout was made aware of the facts of the predicament. Several schemes were suggested and banished as impractical and the four men walked the floor as if in search of an idea that would remove the peril from the bank. Hearing several footsteps in the larger office Mr. Ridout opened the door and admitted several other directors. While these gentlemen were listening to the letter the remainder of the board arrived and all took their accustomed places at the table. There was very little speech, and at length, as if to break the silence, the president made a motion that a movement be started beginning with Mr. Martts on the right.

Mr. Martts was in a deep state of despondency and could make no suggestion. The next gentlemen acted likewise and in due course it was Mr. Ridout’s turn to speak. He arose quickly and clenching his hand, struck the table a heavy blow, remarking, when

the look of astonishment had subsided from the faces of the others, “Gentlemen, if you will leave this matter to me I will see that the specie now in the vault downstairs is not exchanged for paper notes.”

The man formed a remarkable contrast with the other members of the bank. Here was the soldier who had piloted the funds of the Canadian Government to safety through the war of 1812; here, the man who had successfully performed the duties of the office of Deputy Assistant-CommissionaryGeneral during that stormy period; here, the man who had taken part in many engagements against the troops from - the United States and on more than one occasion had been in the foremost ranks when the enemy had failed to gain their point against the Canadians.

His commanding manner as he stood before the down-hearted members of the Bank Board was sufficient to cause his word to be accepted by a majority of the members, and after the lapse of a moment or two the president put a motion that Mr. Ridout be appointed convener of a committee consisting of the manager and Mr. Janson and himself. This was quickly carried and the meeting adjourned.

Mr. Ridout, after giving instructions to a junior clerk re the cash window, left the building to seek his old friend John Gallson. The noon hour being at hand, the two were soon engaged in conversation and after a slight repast sought a few of their intimate acquaintances and by half-past one had the details of their scheme perfected.

That evening the insurrectionary leaders gathered their adherents in the large outhouse of John Doel’s brewery, now at the corner of Bay and King Streets, Toronto, and made arrangements for a run on the Bank of Upper Canada.


Next morning, long before banking hours, a long line of men was to be

seen near the bank premises. They were, for the most part, followers of Mackenzie, but the friends of Mr. Ridout held the positions in the front portion of the line.

In due time the bank doors were opened and the first person to enter was old John Gallson. Stepping to Mr. Rid out’s cage he laid two one pound notes on the counter and demanded payment in farthings. It took so long to count the money that one hour in time was gained for the bank. Then stepped another of the bank supporters and demanded payment of four onepound notes in the smallest silver. This continued till nightfall and Mr. Ridout’s friends still kept up the ruse. When the line had departed for the night, all the monies paid out during the day were placed in the vault. After another day carried out in a similar manner the rebels saw the impossibility of draining the bank of its funds, and not noticing that the men carrying out the monies were royalists, they gave up in despair and a few days later took to open revolt with Mackenzie at their head.

The old bank continued to do a thriving business at the same corner for a few years following this defeat of the insurrectionists and then, the quarters becoming cramped, the bank transferred its offices to larger premises, where it enjoyed prosperity for many seasons.

On the 29th of July, 1861, however, Mr. Ridout’s desk was vacant and customers on making enquiries were told that he would no longer handle the funds of the institution. After the death of this fine old Canadian the bank’s business began to fall off and about the year 1866 the doors were shut for the last time. The new cashier could not tide the establishment over a second stormy period. The bank failed and there disappeared the occupants of the two old buildings which still stand —all that is left of one of the first banking ventures of magnitude in Canada.