26th December, 1796, the same
Governor and Council imposed an interest charge of 7 1/2 per cent on
all arrears of quit rent previous to 1st January, 1796, along with
other debts to the Company, such arrears obviously being regarded as
debts. This, no doubt, complicated the issue. It need only be pointed
out here that were such interest even chargeable, the rate exceeded
that permitted under the Usury Laws in force in England at that time,
although the laws of the settlement could not be repugnant to the laws
of England.1 As if to add insult to injury, free schools
were abolished and henceforward school fees were to be paid.2
By the time the grant certificates were issued, the quit
rent issue had become the rallying ground of discontent and general
opposition to the government. The peace and tranquillity of the
settlement was disturbed and the opinions of the” Hundredors &
Tythingmen” on the subject of the quit rent were made the test by which
they were thought worthy of the confidence of the people. It became
their local election banner and all who had ventured to support it were
thrown out of office and men more congenial to the social temper
elected in their places. By the second half of 1797 the country was in
a state little short of anarchy although actual violence was avoided. A
compromise was reached and the quit rent was not then enforced. After
about a year of normalcy the truce was broken by the arrival of Mr.
Gray with instructions from the Court of Governors to enforce the quit rent.
Hasty measures of price-control and regulations against extortion were
undertake and an attempt was made to use the technique of remission of
school fees as an incentive to payment of the quit rent and so enforce
it by the back door.3 This proved a complete failure and the
people were alleged to have acted rather as if by sending their
children to school they were conferring a benefit on the government.
The opposition became formidable and since the peace of
the settlement seemed to lie in danger the collection of the quit rent
was suspended and the condition on which the children were admitted to
school was relinquished a few months later.4 These measures
were not in themselves sufficient to check the drift towards revolution
especially as the issue of the quit rent had come to be
espoused to that of the settlers’ claim to a right to regulate
immigration. A conflict, therefore, ensued but the Company government
was saved by the timely arrival of the Maroon Settlers, to whom they
had promised land, and some regular soldiers by whose aid the settIers
were overcome.
When in 1801 the newly appointed Governor reviewed the
issue of the quit rent, he found it (with astonishing objectivity for
his time) wholly defective; but his remedy was a mere patch work. The
remedy was two-fold:
(1) to reduce the quit rent to all widows and orphans on
lands already granted to ten cents and one cent per acre respectively
(2) for all others to establish rates as follows:
(i) to everyone cultivating one-quarter of his land, ten cents per acre
(ii) to everyone cultivating one-half of his land, one cent per acre.
.
The object, clearly, was to relieve the widows and orphans
and by relieving them restore confidence to the people in the security
of their tenure; and, by a differential scale of rent on cultivated and
uncultivated land to give an incentive to cultivation. The rationale is
simple but it is doubtful whether those objects were in any measure
achieved before the final abotition of the quit rent under the Company
government in 1803.
Before going into that as well as the economic
consequences of quit rent generally, it may be of advantage to consider
briefly but in rather more detail the general theory or principles of quit rent.
The quit rent
was
a yearly payment—- a relic of the feudal system— made by the
copyholders and freeholders of an English manor to its lord. It was
called quit rent because it
acquits the tenant of all dues and obligations to the land. They were
of two kinds. According to Blackstone ,“ rents of assize
are the certain established rents of the freeholders and ancient
copyholders of a manor, which cannot be departed from or varied. Those
of the freeholders are frequently called chief rents, reditus capitales; and both sorts
are indifferently denominated quit
rents, quieti reditus ; because thereby the tenant goes quit and
free of all other services.” 1 Blackstone further tells us
that it originates from a theory (which is indeed a fiction originating
1 Blackstone, Sir Wm., Commentaries, Book II, pp. 42 and 51.
with the Conquest Settlement)
that
the King is the universal lord and original proprietor of all lands in
his kingdom; and “that no man doth or can possess any part of it, but
which has...been derived as a gift from him, to be held upon feudal
services “. Its characteristics are:
(1) it is a return made by freeholders (and copyholders)
for services for which land might be granted
(2) it cannot be varied---increased or diminished--or
departed from and so it must be certain
or capable of being reduced to certainty by either party
(3) it issued out of the land so held
(4) it could be distrained by the lord in whosoever's
hands the land was
(5) it must not be a part of the hereditaments so held
and, therefore, there must exist a corporeal hereditament, e.g. land
but not intangible items of property so that the owner can distrain for
non-payment
(6) it must be a profit.
It was treated as a thing--a tenement--just like the land.1
In the middle ages it was regarded as a thing, issuing from the land
and recoverable by real actions.2
And before 1833 it was invariably regarded as an incorporeal thing.3
When the Crown’s powers devolved on or came to he vested in the modern
State, the fiction on which payment of the quit rent
was based became no longer tenable. Continuation of payment meant
payment to a body other than the sovereign lord and, in fact, the
payment went to benefit individual landlords. We, therefore, find the
quit rent being progressively abolished. In England where the theory
persisted longer, the Law of Property Act, 1922, envisaged its
extinction and they have at last been extinguished as from 1st
November, 1950.4
1 Holdsworth, Sir Wm., An
Historical Introduction to the Land Law
(1927), p. 97. 2 Holdsworth, loc. cit., p. 98--Sir William
also tells us that "real action" meant (by the close of the Middle
Ages) an action in which the specific thing demanded could be
recovered. Op. cit., p. 11. 3The Act 3 and 4 William iv c. 27 Sec.
36(1833) abolished real
actions. Legally this tended to give reins to the idea that rent is not
so much an incorporeal thing as a payment done by virtue of a contract. 4Cf. Postponement of Enactments (Miscellaneous
Provisions) Act, 1939 (Manorial Incidents Extinguishment), Order, 1949,
issued as Statutory Instruments, 1949, No. 836, dated 29th April, 1949.
Clearly, the scheme
as operated
by
the Sierra Leone Company did not amount to a quit rent at all. Even if
we postulate physiocratism, it was clearly not a ‘ profit “ since it
was determined long before the land was put into productive use. Quite
apart from the grants being too small to warrant any expectation of
profitable production, the rates fixed were too high. Governor Ludlam
spoke of the rates as being five or six times that heard of elsewhere.
By contrast, in the New South Wales Settlement simultaneously founded
with Sierra Leone where the grants were considerably larger in size,
the rate of quit rent
determined by the Ministers of the Crown was 1s. for every fifty acres
and payment was not to commence until after five years and so ensuring
the certainty of the quit rent. Moreover, in New South Wales forfeiture
was to be the penalty for failure to cultivate and was to begin before
the operation of the quit rent, not after, whereas in Sierra Leone both
could operate together and, therefore, tended to get confused. The quit
rent in Sierra Leone was at least fifty times that of New South W ales
(Australia).
From the first also it violated the principle
of
invariability.
The quit rent, as a medieval incident, was in the nature
of a negatively progressive income tax which became less burdensome as
productivity improved. The quit rent, in the early history of Sierra
Leone, on the other hand, was in the nature of an uncertain property
tax which grows more and more burdensome on the settler the more
efforts are made to improve the land. Ludlam s reform (outside its
application to widows and orphans) was rather in the nature of a
regressive tax on gross income--part property and part income tax.
Also, the manner of its administration was unfortunate. As to the land
question itself. The imposition of the rent induced the settlers to
pose a claim to their abstract right to the land itself. Here the point
must not be overlooked that the transition from the proprietorship of
Sharp to Charter Company government must itself have appeared a
revolution to the people the full significance of which would be
incomprehensible to minds too little developed to enter into the
subtleties and intricacies of English land law. Under the
proprietorship of Sharp the land belonged to the settlers who granted
portions of it "by the free vote of their own common
126 C. M. H. Clark and L. J. Pryor : Select Documents in Australian History
(1788-1850) (London, 1950), p. 220.
Council" besides formulating
their own agrarian law.1
The Company instituted an all-white government and, in this matter,
departed from the established principle of previously consulting the
Hundredors and Tythingmen about legislation before passing it. Had the
settlers realized that its proceeds were to be used for municipal
purposes to their own benefit it is possible that less friction might
have been experienced although, as has been pointed out already, the
rates were too high.. For nearly five years before they had been a
self-governing community.
Very little is known about the effects of the quit rent
experiment. We can only speculate about them. There were, no doubt,
immediate and short-term effects and there have certainly been
long-term effects. As indicated before the financial harvest was not
likely to have been a rich one. Of the immediate effects, the most
spectacular were the mass movement away from the land, the neglect of
cultivation, emigration and consequent depression in agricultural
production. Ludlam (1801) tells us that “ most of the farmers who
determined not to pay the quit rent took active part in the
insurrection and left the country”. Consequently, one of its primary
effects was to stimulate the emigration of the farmers--a loss to the
settlement of those with the only experience in cultivation and having
the agricultural technique, rudimentary and inefficient, perhaps, but
reasonably effective. The remainder of the farmers who oppose the quit
rent he similarly reports as having “quitted their lands and suffered
their farms to fall to ruins".2 This must have had a serious
effect on production in the settlement especially as “not 10% of the
population had not at one time or the other opposed the quit rent “.
The loss of output, in turn, must have aggravated scarcity of
provisions and the inflation which was already rampant in the
settlement. The psychological effects of this state of affairs, no
doubt, was conducive to that “good conduct of all description of
persons” during the Timanee wars which ensued and
1 Letter of Sharp dated 5th October, 1891 to a
“Dr. friend” reproduced in Memoirs, op. cit., p. 360. 2 Thus whereas Ludlam estimates that there were
between 600 and 700 acres under cultivation before the insurrection
(vide Madden Report, 1841, p. 261), Commissioner (later Governor) Dawes
estimated that there were only 448 acres under cultivation in 1810
"about one-half of which had been cleared within these last thirteen
months" reflecting the extent to which cultivation had declined in the
meantime, i.e. to about 224 acres.—C.O. 267/29.
which, among other things, induced Governor Day’s administration
to abolish the quit rent in 1803.1
Apropos the non-farming classes, Ludlam also tells us that
the greatest part of them
chose to surrender their farms rather than pay the quit rent or oppose
it. There was no incentive for them to retain the land. Either, in the
heat of the controversy, they might have considered that by keeping
possession their lives were endangered or, which is more likely,
because of the inflation and the consequent rising cost of farm labour
or the infertility of the upland farms, it was not profitable to retain
possession while the impost was in force.
"Where there is, then, no good
for which to strive,
No strife can grow up there from faction.”
(Milton.)
There was consequently a mass exodus from the land and
loss of the best
of the agricultural skills the settlement previously possessed. The
widows and orphans, it is believed, suffered more. Again, Ludlam
writes:--
"...the fears of the people that the quit rent may deprive their
children of their lands, are not wholly without foundation. The
administration of the late H. Lawrence’s affairs is in my hands; and
his eldest son and heir to his land, lives with me. I am fully of
opinion that it will be more eligible to surrender the land, if I
cannot find a purchaser for it, than to keep it by paying a shilling an
acre till the child is of age. I think there is sufficient probability
that the money it would by that time amount to will then purchase him
an equal quantity of land shall he be disposed to become a farmer, and
if he follows any other profession will certainly be of more use in his
own hands. In many similar cases it may neither be easy to find a
person to advance the money yearly during the non-age of the child, nor
for the child to pay it at once on his coming of age. It is right also
to observe that the quit rent may be sensibly felt by those who
cultivate to any extent whether Europeans or others. They can scarcely
avoid having a considerable quantity of land out of cultivation in many
cases much more than they can be expected to keep in a cultivated
state, and the quit rent on the whole of their lands will not be
inconceivable.” 2
From this he concluded that this tax might have operated
to dispossess this class of persons (widows and orphans) of their
lands. It is not unlikely too that with the inflation and consequent
1 C.0. 270/9—Council
Minutes of l8th April, 1803. 2 C.0. 270/6, fol. 297.
fall in the value of land there might have been much land
speculation and turnover of land ownership.
The long-run effects must be in the nature of a shock. The
security of ownership and possession which had been nursed and taken
for granted during the period of Frank-pledge government was completely
shattered and, during the Company period and after, the whole
atmosphere was overcast with clouds of uncertainty, leaving a sense of
insecurity with regard to tenure and doubt as to ownership of the land
itself. “The people looked upon the quit rent as in fact taking away
the value and security of
their lands” (italics mine).
The most significant long-term effect is the legacy of
suspicion, insecurity, and uncertainty handed down, as it were, through
the inheritance of tradition from generation to generation. It must
have had a profound influence on development, particularly agricultural
development, throughout the history of the colony. If, indeed, there is
anything like race memory, it
is not unlikely that it is the memory of this experience which--revived
by the land clauses to the Protectorate Ordinance, 1896--threw the
Protectorate Chiefs into the arms (and sympathy) of the Colony people
who were known to have been in complete sympathy and support of the
latter in their struggle against Governor Cardew. The suspicion that
the white man was going to dispossess the Africans of their lands runs
throughout the history of the colony. It is largely responsible for
race relations in it. There can be no doubt that the quit rent troubles
contributed in no small measure to it if it wasn’t even the foundation
for those fears. That experience at the very prime of the settlement
was fundamental not only to the course of its economic development but
also of race relations.
The tax was first abolished in 1803. The Crown Colony,
therefore, did not actively inherit it from the Company. But in 1812,
the new government revived the expedient after taking steps to
systematize and improve its administration. It was finally abolished in
1832.1 Even so, it does not appear to have been much better
in operation than its predecessor. From the first, it began to impose
similar hardships on the people. In 1813, the first year of its
operation, there were no less than fourteen defaulters with rents
approaching £5 outstanding whose lands were accordingly all confiscated
to the
1 C.0. 270/20--Minutes
of Council of 24th November, 1832,
government. Among them there was
one defaulter with an unusually large estate of 525 acres of country
lands.1
That he should have permitted so large an extent of landed property to
be confiscated in default of barely £3 5s. 7 1/2d. quit rent is a sad
commentary on the operation of the tax itself. It is clear proof that
the opportunity cost of that sum was greater than doing without the
land. It may be that it was through operations like these that land
speculators acquired large tracts like the Heddles’ estates.
There was also a town lot listed as belonging to the
“Estate of Anty Hill” 2
which indicates that the rent was still operating adversely against
inheritance as Governor Ludlam had apprehended. It is, therefore,
difficult to resist Lord Goderich’s conclusion that the scheme of
deriving a revenue from quit rents “is condemned both by reason and
experience ".3
The experiences with these two devices at direct taxation
in the early history of this country are sharply contrasted. The one,
as we have already seen, brought in considerable benefits to the
community whereas the other literally led to untold evils. There are,
no doubt, many lessons to be learnt from these experiences--lessons on
fiscal policy and lessons on administration in an underdeveloped
country. I leave it to the audience to draw out those lessons.4
I may, perhaps, be permitted to observe that these devices in the
context
1C.O. 270/14, fol. 70. 2 CO. 270/14, fol. 50. 3Dispatch of Lord Goderich to Governor Darling
dated 9th January, 1831; quoted C. M. H. Clark and L. J. Pryor, op.
cit., p. 223. 4In view of the trend of the discussions
following the paper, it has appeared wise to direct attention to some
of the more salient conclusions. In the first place, besides violating
the known Adam Smithian maxims, the tax was completely divorced from
any relation to taxable capacity. The first lesson, therefore, is that taxation to be satisfactory must be
related, in some way, to the taxable capacity of the community.
In the next place, the experience of the quit rent
showed (although it was operated in a non-democratic atmosphere) that
where practically the whole population was opposed to the device,
compulsion could lead to the unbalance of the economic and social
stability of the society. But for the almost accidental arrival of the
Maroons, a successful political revolution might have been effected.
From this it follows, thirdly, that apparently insignificant fiscal
devices can have ramifications far beyond the mere collection of
revenue. Consequently, governments in adopting fiscal measures must
take into consideration, as far as it is possible to do so, these wider
implications of a tax policy. Lastly, the administration and abuse of
these fiscal devices showed that a commercial company (as the
experiences with the East India Company so well confirms) cannot be
trusted to carry out its commercial functions simultaneously with the
functions of government without sacrificing the latter to the former
and so becoming the purveyor of inestimable misery and the disturbance
of the social equilibrium of the society.
of the early history of this colony explode the popular fallacy
that "a
good thing does not last". The quit rent was abolished in 1832 although
not before it had laid the basis for a less noxious land tax. The road
tax continued to 1872 and, but for the "hasty" action of Governor Pope
Hennessey could very well have evolved to an equitable direct tax long
before the income tax of 1943.