
Contents
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I. The Rise of Paper Money I. The Rise of Paper Money
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1. The ‘Old’ Bank and the ‘New’ 1. The ‘Old’ Bank and the ‘New’
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2. Banknotes: Form and Appearance 2. Banknotes: Form and Appearance
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3. The Assessments of Hume and Smith 3. The Assessments of Hume and Smith
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4. The Position at Mid-Century 4. The Position at Mid-Century
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II. Paper Money and the Law: The Case of the Stolen £20 Note II. Paper Money and the Law: The Case of the Stolen £20 Note
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1. Mr Crawfurd’s Claim 1. Mr Crawfurd’s Claim
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2. The Banks’ Response 2. The Banks’ Response
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3. Procedure and Sources 3. Procedure and Sources
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4. Preliminary Matters 4. Preliminary Matters
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5. Vindication of Money 5. Vindication of Money
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6. The Result, and the Reasons 6. The Result, and the Reasons
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III. Doctrinal Development: Iavolenus, Voet, and Stair III. Doctrinal Development: Iavolenus, Voet, and Stair
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1. Iavolenus and Voet 1. Iavolenus and Voet
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2. Iavolenus and Stair 2. Iavolenus and Stair
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IV. Aftermath IV. Aftermath
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25 Banknotes and their Vindication in Eighteenth-Century Scotland
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Published:January 2016
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Abstract
The first banknotes in Scotland were issued in 1695 following the incorporation of the Bank of Scotland and were an almost immediate success. A century later no fewer than 21 banks, mainly private, issued notes, and Scotland was awash with paper money. This proliferation of paper would hardly have been possible without a stable legal framework. In 1749, the case of Crawfurd v The Royal Bank considered, and settled, one of the key legal issues: whether the holder of a banknote took free from infirmities of title which affected those from whom it had been acquired. In the battle of doctrine against policy, Roman law was used as a proxy, with both sides calling on Digest texts and on the account of vindication in Voet’s Commentarius ad Pandectas. Victory for the Royal Bank was obtained only by re-characterizing a rule of bona fide consumption, by spending, as one of bona fide acquisition; and so with this flimsiest of doctrinal veneers, the free circulation of banknotes was assured.
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